Decision Making Analysis

Making Decisions in Risky and Uncertain Circumstances

Making decisions in risky and uncertain circumstances is the subject of the topic “decision analysis.” Decision tables and utility theories serve as the foundation for analysis and discussion during research. Students were expected to apply decision theory to make logical conclusions by the end of the topic and to use the phases of decision making to create answers to challenging decision-making challenges (Goodwin & Wright, 2014).

Thorough Knowledge for Effective Application

Furthermore, a thorough knowledge of the ideas would enable effective application of utility theory to problems impacting decision-making. Assessment of risky human and ecological factors requires risk-management decisions that are characterized by partial knowledge of the systems, and full understanding of decision analysis. An error arising from measurements and considerable data variability may be a hindrance to risk identification and implementation of the appropriate risk management strategies. The quantitative aspect of decision analysis may help in dealing with the challenges because it covers the management strategies for the uncertainties explicitly and quantitatively (Keeney, 2013). The knowledge gathered in decision analysis will help in identifying policies that can assist in managing the risk. Moreover, the resulting optimal decision does not affect that taken when the puzzles do not get a quantitative approach.

Application in the Shipping Industry

For example, as a manager in the shipping industry, I would advise the company to adopt the Palisade’s risk to financial models. The model would then help in capturing and simultaneously assessing risks in the dynamic shipping market (Goodwin & Wright, 2014). The impact is likely to be an increased level of transparency to the investors, which then leads to an improved revenue for the company.

References

Goodwin, P., & Wright, G. (2014). Decision Analysis for Management Judgment 5th Ed. Hoboken: John Wiley and sons.

Keeney, R. L. (2013). Foundations for group decision analysis. Decision Analysis, 10 (2), 103-120.