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Operations Management: Sustainability and Supply Chain Management, Twelfth Edition
book

Operations Management: Sustainability and Supply Chain Management, Twelfth Edition

by Jay Heizer, Barry Render, Chuck Munson
February 2016
Intermediate to advanced content levelIntermediate to advanced
480 pages
219h 58m
English
Pearson
Content preview from Operations Management: Sustainability and Supply Chain Management, Twelfth Edition

Types of Decision-Making Environments

The types of decisions people make depend on how much knowledge or information they have about the situation. There are three decision-making environments:

  1. LO A.3 Explain when to use each of the three types of decision-making environments

  • Decision making under uncertainty

  • Decision making under risk

  • Decision making under certainty

Decision Making Under Uncertainty

When there is complete uncertainty as to which state of nature in a decision environment may occur (i.e., when we cannot even assess probabilities for each possible outcome), we rely on three decision methods:

  1. Maximax: This method finds an alternative that maximizes the maximum outcome for every alternative. First, we find the maximum outcome ...

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Publisher Resources

ISBN: 9780134422404