Knowledge Management

Decision Analysis Theories

This apparent inattention to an important discipline disguises a bewildering clutch of widely unused and mainly academically devised approaches to decision making that are available and categorized under the broad-based classification of Decision Analysis. They include techniques such as Analytic Hierarchy Process (AHP), Bayesian Updating, Outranking, Subjective Judgment Theory, Utility Assessment, Matrix, Cost–Benefit Analysis, and the Decision Tree—the last three being the most commonly known.

Matrix, for example, utilizes a subjective weight assignment for alternative criteria, its main drawback being that it cannot account for interdependence between so-called best alternatives. Cost–Benefit Analysis, which provides ...