The Essentials of the Analytic Network Process
with Seven Examples
Decision Making with Dependence and Feedback
The Super Decisions Software
Thomas L. Saaty
Every Project should have a summary with the following figures andtables included
1. Title with brief explanation of what the problem is and why a decision is needed.2. BOCR networks compactly shown3. Table of the BOCR control criteria, subcriteria and their priorities4. Table of the priorities of the alternatives from each BOCR network nicely arranged5. Table of the synthesized priorities of the alternatives for each of the 4 BOCR 6. Strategic criteria and subcriteria and their priorities7. The intensity scale for rating the BOCR and table for rating the top alternative for each of the 4 BOCR as representative of that BOCR merit. Most costly and most risky alternative must be derived and used. The four priorities of the BOCR must be shown before and after normalization8. Table of overall synthesis of the priorities of the alternatives with the marginal formulas BO/CR and the total formula bB+oO-cC-rR
AHP Causal, ANP Non-Causal and is a New Way of Thinking and Synthesis
• In the AHP we distribute priorities from the goal downwards towards the alternatives and can logically indicate the causes and intensities and their effects on the alternatives at the bottom. The process allows us through priorities to use a multi-valued logic because of the use of an absolute scale to represent relative intensities.
• The ANP is far more general and powerful than the AHP and its effects cannot be traced back through its loops and cycles in a simple way to original causes. Strictly speaking while the ANP deals with the outcome of influence, it does it through an infinite cyclic process which of course is nonlinear. Thus with good judgments and scenarios, the ANP can be used to work backwards from the future to the present to guide action towards a more desired future.
Market share is one kind of economic influence, but there are all kinds of influencesthat determine the outcome of a decision. First there are other kinds of economic influence like taxation, trade, employment, pricing and many others. There are also political, social,technological, environmental, educational, ideological and many other kinds of influence.
There are many influences that affect the outcome of a decision. We cannot treat them alltogether because we don’t know which one is operating the hardest and what its outcome is.We need to separate them and call each one a control criterion which may have subcriterialike educational influence through schools or through television.
Every decision has benefits (B), opportunities (O), costs (C) and risks (R). Each of these has its own kind of control criteria. We have to prioritize the control criteria according to their importance. Those under benefits get their own priorities, under opportunities their own and similarly for costs and risks.
The Story in a Nutshell
The Economist Newspaper April 23, 2005
Page 11: A more sensible green analysis of nuclear power would weigh its (very high) economic costs and (fairly low) safety risks against the important benefit of generating electricity with no greenhouse-gas emissions.
Page 77:Last month, for example, saw the publication of the Millennium Ecosystem Assessment, the first global survey of ecological services. Its authors warn that attention will have to be paid to these services if global development goals are to be met. But the only way this can happen is if ecological services have sound,real (and realistic) values attached to them. As "Valuing Ecosystem Services", a report written recently for America's National Research Council, points out, the difficult part is providing a precise description of the links between the structures and functions of various bits of the environment, so that proper values can be calculated. What this means is that the more there is known about the ecology of, say, a forest, the better the valuation of the services itprovides will be. Fortunately, according to two reports published by the World Bank at the end of 2004, significant progress has been made towards developing techniques for valuing environmental costs and benefits. There is, says one of these reports, no longer any excuse for considering them unquantifiable.
What we need to do for a decision is to build as in the market share example a network for each control criterion. There can be many control criteria each with its network.
When we have derived the priorities for a network we divide the priorities of the alternatives by the largest priority among them so the best alternative receives the value one. We do this for each control criterion. We then weight the priorities of the alternatives by the priorities of their control criteria and add for the benefits and then for the opportunities and then for the costs and the risks This yields four different sets of priorities for the alternatives.
To combine the four outcomes, we rate the top alternative for each with respect to strategic criteria and subcriteria using the rating mode of the AHP that involves intensities. This process yieldspriorities b, o, c and r for the best alternative under benefits to get b and opportunities to get o and the worst alternatives under costs and risks because they have the highest priority to get c and r. In the case of costs and risks we always ask which is more costly and which is more risky.
If we assume that the priorities of the alternatives under the BOCR are respectively (B1, B2 ,…, Bn),(O1, O2 ,…, On ),(C1, C2 ,…, Cn ) and (R1, R2 ,…, Rn ) then the final outcome would be, (b B1+o O1-c C1-r R1, b B2+o O2-c C2-r R2,…, b Bn+o On-c Cn-r Rn) which may be negative for some or all the alternatives, like trying choose the best from among a bad set of alternatives.
Why do we select the top rated alternative under each of the BOCR merits to rate the BOCR when it may be that the top alternative may not be the same for each of them? Because focusing on the top alternative gives us a better opportunity to select with greater clarity the appropriate ratings for it. Intermediate alternatives may be so close that it would be difficult to distinguish among their ratings.
Predictive decisions are objective as their outcome depends on what is likely to happen. Non-predictive decisions are subjective and depend on how much people value their benefits, opportunities, costs, and risks (BOCR).
PREDICTING AND DECIDING
Outline of the Steps of the ANP
• Describe the decision problem in detail including its objectives, criteria and subcriteria, actors and their objectives and the possible outcomes of that decision. Give details of influences that determine how that decision may come out.
• comparisons are made simply in terms of benefits, opportunities, costs, and risks in the aggregate without using control criteria and subcriteria. • 3. Determine the most general network of clusters (or components) and their elements that applies to all the control criteria. To better organize the development of the model
as well as you can, number and arrange the clusters and their elements in a convenient way (perhaps in a column). Use the identical label to represent the same cluster and the same elements for all the control criteria.
• 4. For each control criterion or subcriterion, determine the clusters of the general feedback system with their elements and connect them according to their outer and inner dependence influences. An arrow is drawn from a cluster to any cluster whose elements influence it.
• 5. Determine the approach you want to follow in the analysis of each cluster or element, influencing (the preferred approach) other clusters and elements with respect to a criterion, or being influenced by other clusters and elements. The sense (being influenced or influencing) must apply to all the criteria for the four control hierarchies for the entire decision.
• 6. For each control criterion, construct the supermatrix by laying out the clusters in the order they are numbered and all the elements in each cluster both vertically on the left and horizontally at the top. Enter in the appropriate position the priorities derived from the paired comparisons as subcolumns of the corresponding column of the supermatrix.
• 7. Perform paired comparisons on the elements within the clusters themselves according to their influence on each element in another cluster they are connected to (outer dependence) or on elements in their own cluster (inner dependence). In making comparisons, you must always have a criterion in mind. Comparisons of elements according to which element influences a given element more and how strongly more than another element it is compared with are made with a control criterion or subcriterion of the control hierarchy in mind.
• 8. Perform paired comparisons on the clusters as they influence each cluster to which they are connected with respect to the given control criterion. The derived weights are used to weight the elements of the corresponding column blocks of the supermatrix. Assign a zero when there is no influence. Thus obtain the weighted column stochastic supermatrix.
• 9. Compute the limit priorities of the stochastic supermatrix according to whether it is irreducible (primitive or imprimitive [cyclic]) or it is reducible with one being a simple or a multiple root and whether the system is cyclic or not. Two kinds of outcomes are possible. In the first all the columns of the matrix are identical and each gives the relative priorities of the elements from which the priorities of the elements in each cluster are normalized to one. In the second the limit cycles in blocks and the different limits are summed and averaged and again normalized to one for each cluster. Although the priority vectors are entered in the supermatrix in normalized form, the limit priorities are put in idealized form because the control criteria do not depend on the alternatives.
• 10. Synthesize the limiting priorities by weighting each idealized limit vector by the weight of its control criterion and adding the resulting vectors for each of the four merits: Benefits (B), Opportunities (O), Costs (C) and Risks (R). There are now four vectors, one for each of the four merits. An answer involving marginal values of the merits is obtained by forming the ratio BO/CR for each alternative from the four vectors. The alternative with the largest ratio is chosen for some decisions. Companies and individuals with limited resources often prefer this type of synthesis.
• 11. Governments prefer this type of outcome. Determine strategic criteria and their priorities to rate the four merits one at a time. Normalize the four ratings thus obtained and use them to calculate the overall synthesis of the four vectors. For each alternative, subtract the costs and risks from the sum of the benefits and opportunities. At other times one may add the weighted reciprocals of the costs and risks. Still at other times one may subtract the costs from one and risks from one and then weight and add them to the weighted benefits and opportunities. In all, we have four different formulas for synthesis.
• 12. Perform sensitivity analysis on the final outcome and interpret the results of sensitivity observing how large or small these ratios are. Can another outcome that is close also serve as a best outcome? Why? By noting how stable this outcome is. Compare it with the other outcomes by taking ratios. Can another outcome that is close also serve as a best outcome? Why?
•
THE STRUCTURE OF COMPLEX DECISIONS
PERSONAL OR GROUP STRATEGIC CRITERIA FOR RATING OF BOCR NODES (SUBJECTIVE VALUES)
Satisfaction Prosperity Security Growth Harmony, etc.
THE BOCR MERIT CONTROL NODES (LINK FROM SUBJECTIVE TO OBJECTIVES)
BENEFITS OPPORTUNITIES COSTS RISKS
Several control criteria for each of the four BOCR whose priorities are obtained from a hierarchy or a network.
FEEDBACK NETWORKS (OBJECTIVE VALUES)
Decision networks containing alternatives-one for each BOCR control criterion. 1. Economic benefits 2. Political benefits 3. Social benefits 4. Technological benefits
and so on for BOCR criteria 5,6,7...
TWO WAYS FOR COMBINING THE PRIORITIES OF THE ALTERNATIVES ARE:
•Marginal Benefit/Cost Analysis (not always useful)•BO/CR
•Subtracting Costs and Risks (always useful)bB + oO - cC - rR
W orld Peace : 0 .648A dversary C ountries : 0 .237Security D ilemma: 0 .449T errorism: 0 .314
Human W ell-be ing: 0 .122T echnologica l A dvancement: 0 .667M arke t C rea tion: 0 .333
Inte rna tiona l Politics : 0 .230M ilita ry Rela tions : 0 .600D iplomatic Re la tions : 0 .400
Stra tegic C rite ria for Eva lua ting M erits
National Missile Defense (NMD)
Prioritization of national US criteria
Criteria and Their Priorities Merits Criteria Sub-criteria Global Priorities
(Normalized)
Benefits Economic(0.157)
Local Economy (0.141) 0.022
Defense Industry (0.859) 0.014
Political (0.074)
Bargaining Power (0.859) 0.064
U.S. Military Leadership (0.141) 0.010
Security (0.481) Deterrence (0.267) 0.128
Military Capability (0.590) 0.284
Anti-terrorism (0.143) 0.069
Technology (0.288) Tech. Advancement (0.834) 0.240
Tech. Leadership (0.166) 0.048
Opportunities Arms Sales (0.520) 0.520
Spin- off (0.326) 0.326
Space Development (0.051) 0.051
Protection of Allies (0.103) 0.103
Costs
Security Threat: Vulnerability to the security threat (0.687) 0.687
Economic (0.228)
Sunk Cost (0.539) 0.123
Further Investment (0.461) 0.103
Political (0.085) ABM Treaty (0.589) 0.050
Foreign Relations (0.411) 0.035
Risks Technical Failure (0.430) 0.430
Arms Race (0.268) 0.268
Increased Terrorism (0.052) 0.052
Environmental Damage (0.080) 0.080
U.S. Reputation (0.170) 0.170
President/Military
Congress
Tech. Experts
Defense Industry
Foreign Countries
Allies
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Congress
Tech. Experts
Industry
Military
Decision Network under Military CapabilityControl Subcriterion of Benefits
President/Military
Congress
Tech. Experts
Defense Industry
Foreign Countries
Allies
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Congress
Tech. Experts
Industry
Military
Decision Network under The Technological AdvancementControlSubcriterionof Benefits
President/Military
Congress
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Congress
Military
Foreign Countries
Other Superpowers
Adversary Countries
TerroristsAllies
Tech. Experts
Defense Industry
Tech. Experts
Industry
Decision Network under The Arms Sales Control Criterion of Opportunities
President/Military
Congress
Tech. Experts
Defense Industry
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Congress
Tech. Experts
Industry
Military
Decision Network under The Spin-OffControl Criterion of Opportunities
President/MilitaryCongress
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Congress Military
Decision Network under The Sunk CostControlSubcriterionof Costs
President/Military
Congress
Tech. Experts
Defense Industry
Congress
Tech. Experts
Industry
Military
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Decision Network under The Further InvestmentControl Subriterionof Costs
President/Military
Congress
Congress
Military
Foreign Countries
Other Superpowers
Adversary Countries
TerroristsAllies
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Decision Network under The Security Threat ControlSubcriterionof Costs
President/Military
Congress
Tech. Experts
Defense Industry
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Congress
Tech. Experts
Industry
Military
Network under The Technical Feasibility Control Criterion of Risks
President/Military
Congress
Alternatives
Deploy NMD
Termination
Global Defense
R&D
Congress
Military
Foreign Countries
Other Superpowers
Adversary Countries
TerroristsAllies
Decision Network under The Arms RaceControl Criterion of Risks
The Unweighted Supermatrix
An entry in each subcolumn of the supermatrix indicates the relative priority within the block to which that subcolumn belongs that an element on the left is influence by the element on top of the column with respect to Military Capability. Each subcolumn is an eigenvector imported from a corresponding pairwise comparisons matrix not shown here because its elements can be approximately formed from the ratios of the corresponding priority vector. A subcolumn of zeros indicates no influence and therefore no comparisons matrix is needed.
MilCap Cong~ Def. Ind~ For~ Pre/Mil~ Tech~Unweighted Deploy Glob~ R & D Term~ Cong~ Industry Allies Military Tech~Altern~ Deploy 0.0000 0.5760 1.0000 0.0000 0.5060 0.5587 0.0000 0.5158 0.2878
Glob~ 0.0000 0.0000 0.0000 0.0000 0.2890 0.2574 1.0000 0.2929 0.2623R & D 0.0000 0.4240 0.0000 0.0000 0.1307 0.1382 0.0000 0.1367 0.2369Term~ 0.0000 0.0000 0.0000 0.0000 0.0744 0.0457 0.0000 0.0546 0.2130
Cong~ Cong~ 1.0000 1.0000 1.0000 0.0000 0.0000 1.0000 1.0000 1.0000 1.0000Defense Ind~ Industry 1.0000 1.0000 1.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000For~ Allies 1.0000 1.0000 1.0000 0.0000 0.0000 0.0000 0.0000 1.0000 0.0000Pre/Mil~ Military 1.0000 1.0000 1.0000 0.0000 1.0000 1.0000 1.0000 0.0000 1.0000Tech~ Tech~ 1.0000 1.0000 1.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000
Altern~
Pairwise Comparisons Matrices and Priorities of Components
Pairwise comparing components with respect to the Alternatives component
Q: Which of a pair of components is influenced more by the Alternatives component with respect to Military Capability?
Altern~ 1.00 1/6 1/4 1.33 1/7 1/1.8 0.0485Cong~ 6.00 1.00 2.20 6.20 1/1.35 3.20 0.2889
Def. Ind~ 4.00 1/2.2 1.00 4.00 1/2.43 2.26 0.1653For~ 1/1.33 1/6.2 1/4 1.00 1/8 1/1.9 0.0425Pres~ 7.00 1.35 2.43 8.00 1.00 5.10 0.3742Tech~ 1.80 1/3.2 1/2.26 1.90 1/5.1 1.00 0.0805
Pairwise Comparison Matrix for Components wrt Alternatives
Pairwise comparing components with respect to the Congress Pairwise comparing components with respect to the Defense Industrycomponent componentQ: Which of a pair of components is influenced more by the Q: Which of a pair of components is influenced more by the Defense Congress component with respect to Military Capability? Industry component with respect to Military Capability?
Altern~ Pres~ Prior.Altern~ 1.0000 0.5638 0.3605Pres~ 1.7736 1.0000 0.6395
Altern~ Cong~ Pres~ Prior.Altern~ 1.0000 0.6769 0.5388 0.2292Congr~ 1.4773 1.0000 0.6600 0.3181Pres~ 1.8561 1.5152 1.0000 0.4528
Pairwise comparing components with respect to the Foreign Pairwise comparing components with respect to the Presidnet/MilitaryCountries component componentQ: Which of a pair of components is influenced more by the Q: Which of a pair of components is influenced more by the President/ Foreign Countries component with respect to Military Capability? Military component with respect to Military Capability?
Altern~ Cong~ Pres~ Prior.Altern~ 1.0000 0.5556 0.3259 0.1671Congr~ 1.8000 1.0000 0.4632 0.2781Pres~ 3.0682 2.1591 1.0000 0.5548
Altern~ Cong~ For~ Prior.Altern~ 1.0000 2.1887 3.6604 0.5735Congr~ 0.4569 1.0000 2.0377 0.2799For~ 0.2732 0.4907 1.0000 0.1467
Pairwise comparing components with respect to the Technical Experts componentQ: Which of a pair of components is influenced more by the Technical Experts component with respect to Military Capability?
Altern~ Cong~ Pres~ Prior.Altern~ 1.0000 2.5379 2.5379 0.5593Congr~ 0.3940 1.0000 1.0000 0.2204Pres~ 0.3940 1.0000 1.0000 0.2204
Priorities Matrix of Eigenvectors How much components are influenced by each component; imported from the matrices of the table above
Clusters Altern~ Cong~ Def. Ind~ For~ Pres~ Tech~Altern~ 0.0486 0.3605 0.2292 0.1671 0.5735 0.5593Cong~ 0.2889 0.0000 0.3181 0.2780 0.2799 0.2204Def. Ind~ 0.1653 0.0000 0.0000 0.0000 0.0000 0.0000For~ 0.0425 0.0000 0.0000 0.0000 0.1467 0.0000Pres~ 0.3742 0.6395 0.4528 0.5548 0.0000 0.2204Tech~ 0.0805 0.0000 0.0000 0.0000 0.0000 0.0000
The Weighted SupermatrixPriorities from the above table are used to weight the corresponding blocks of the unweighted supermatrix
MilCap Cong~ Def. Ind~ For~ Pre/Mil~ Tech~Weighted NMD Glob~ R & D Term~ Cong~ Industry Allies Military Tech~Altern~ NMD 0.0000 0.0280 0.0000 0.0000 0.1824 0.1280 0.0000 0.2958 0.1610
Glob~ 0.0000 0.0000 0.0000 0.0000 0.1042 0.0590 0.1671 0.1680 0.1467R & D 0.0000 0.0206 0.0000 0.0000 0.0471 0.0317 0.0000 0.0784 0.1325Term~ 0.0000 0.0000 0.0000 0.0000 0.0268 0.0105 0.0000 0.0313 0.1191
Cong~ Cong~ 0.3037 0.2889 0.3037 0.0000 0.0000 0.3181 0.2780 0.2799 0.2204Defense Ind~ Industry 0.1737 0.1653 0.1737 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000For~ Allies 0.0446 0.0425 0.0446 0.0000 0.0000 0.0000 0.0000 0.1467 0.0000Pre/Mil~ Military 0.3933 0.3742 0.3933 0.0000 0.6395 0.4528 0.5548 0.0000 0.2204Tech~ Tech~ 0.0846 0.0805 0.0846 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000
Altern~
The Limit SupermatrixThe weighted supermatrix raised to sufficiently large powers to stabilize within rounded off four place decimals
MilCap Cong~ Def. Ind~ For~ Pre/Mil~ Tech~Limited NMD Glob~ R & D Term~ Cong~ Industry Allies Military Tech~Altern~ NMD 0.1532 0.1532 0.1532 0.0000 0.1532 0.1532 0.1532 0.1532 0.1532
Glob~ 0.0968 0.0968 0.0968 0.0000 0.0968 0.0968 0.0968 0.0968 0.0968R & D 0.0438 0.0438 0.0438 0.0000 0.0438 0.0438 0.0438 0.0438 0.0438Term~ 0.0201 0.0201 0.0201 0.0000 0.0201 0.0201 0.0201 0.0201 0.0201
Cong~ Cong~ 0.2224 0.2224 0.2224 0.0000 0.2224 0.2224 0.2224 0.2224 0.2224Defense Ind~ Industry 0.0513 0.0513 0.0513 0.0000 0.0513 0.0513 0.0513 0.0513 0.0513For~ Allies 0.0619 0.0619 0.0619 0.0000 0.0619 0.0619 0.0619 0.0619 0.0619Pre/Mil~ Military 0.3255 0.3255 0.3255 0.0000 0.3255 0.3255 0.3255 0.3255 0.3255Tech~ Tech~ 0.0250 0.0250 0.0250 0.0000 0.0250 0.0250 0.0250 0.0250 0.0250
Altern~
IDEALIZED DECISION NETWORK VECTORS times NORMALIZED CONTROL CRITERIA
Benefits Military Capability Technical Advancement SUM ofControl Criterion wt. (CC) 0.075 0.063 wtd Alts
Normalized CC 0.542 Col. 1 0.458 Col. 2 Col 1 + Col 2Alternatives Idealized (CC x Ideal.) Idealized (CC x Ideal.) SUM
Deploy 1.000 0.542 0.928 0.425 0.967Global 0.623 0.338 1.000 0.458 0.796
R&D 0.282 0.153 0.448 0.205 0.358Terminate 0.129 0.070 0.085 0.039 0.109
Opportunities Arms Sales Spinoff SUM ofControl Criteria (CC) 0.096 0.06 wtd Alts
Normalized CC 0.614 Col. 1 0.386 Col. 2 Col 1 + Col 2Alternatives Idealized (CC x Ideal.) Idealized (CC x Ideal.) SUM
Deploy 1.000 0.614 1.000 0.386 1.000Global 0.674 0.414 0.521 0.201 0.614
R&D 0.341 0.209 0.288 0.111 0.321Terminate 0.190 0.117 0.166 0.064 0.181
Costs Sec. Threat Sunk Cost Further Inv. CostsControl Criteria (CC) 0.687 0.123 0.105 Sum of
Normalized CC 0.751 Col. 1 0.134 Col. 2 0.115 Col. 3 Col's 1+2+3Alternatives Idealized (CC x Ideal.) Idealized (CC x Ideal.) Idealized (CC x Ideal.) SUM
Deploy 0.183 0.137 1.000 0.134 1.000 0.115 0.386Global 0.344 0.259 0.574 0.077 0.496 0.057 0.393
R&D 0.579 0.435 0.332 0.044 0.279 0.032 0.512Terminate 1.000 0.751 0.193 0.026 0.147 0.017 0.794
Risks Tech Failure Arms Race RisksControl Criteria (CC) 0.43 0.268 Sum of
Normalized CC 0.616 Col. 1 0.384 Col. 2 Col's 1 + 2Alternatives Idealized (CC x Ideal.) Idealized (CC x Ideal.) SUM
Deploy 1.000 0.616 1.000 0.384 1.000Global 0.621 0.382 0.693 0.266 0.648
R&D 0.375 0.231 0.441 0.169 0.401Terminate 0.262 0.161 0.302 0.116 0.277
High HighVery LowMedium Terrorism
.203
Very LowVery High Very Low Very Low Security Dilemma
.290
Very Low High Medium Very HighAdversary Countries .154
World Peace
.650
RisksCosts Opportunities Benefits
0.611
0.363
Low
Medium
Very Low
Low Very LowHigh High Technological Advancement.081
Human Well-Being
.120
0.318
0.188
0.380
0.184
0.446
0.264
Very High Low LowDiplomatic Relations .092
Very LowHigh High Military Relations
.138
International Politics
.230
Ratings Total
Normalized
Very LowHigh Medium Market Creation
.041
Priority Ratings for the Merits: Benefits, Opportunities, Costs and Risks
Very High (0.419), High (0.263), Medium (0.160), Low (0.097), Very Low (0.061)* Idealized: Very High (1.000), High (0.619), Medium (0.381), Low (0.238), Very Low (0.143)
Synthesis of the Alternatives in Two Ways
Sum of the BOCR merit priorities times the “Totals“ for their control criteria
Benefits Opportunities Costs Risks0.264 0.184 0.363 0.188
Alts Sum(from above) (Sum x .264) Sum(from above) (Sum x .184) Sum(from above) (Sum x .363) Sum(from above) (Sum x .188)
Deploy 0.967 0.255 1.000 0.184 0.386 0.140 1.000 0.188Global 0.796 0.210 0.614 0.113 0.393 0.142 0.648 0.122R&D 0.358 0.094 0.321 0.059 0.512 0.186 0.401 0.075Terminate 0.109 0.029 0.181 0.033 0.794 0.288 0.277 0.052
*If a sum column is not ideal, that is, the largest value not 1.0, idealize by dividing by largest value in the column
BO/CR bB+oO-cC-rR(from unw td columns (from w eighted col's (Unitized by dividing by number
Alternatives in table above) Normalized in table above) w ith smallest absolute value)
Deploy 2.504 0.493 0.111 1.891Global 1.921 0.379 0.059 1.000R&D 0.560 0.110 -0.108 -1.831Terminate 0.090 0.018 -0.278 -4.736
Next-Generation DVD Format WarsDecember 10th , 2007
Hui-Ching ChenWen-Yi HuangHitoshi MinasawaXiang Yu
26
Problem Statement• As the market penetration of HDTV is becoming
more pervasive, consumers might consider purchasing a high definition DVD player to maximize the quality of content for display on the HDTV.
[ GOAL ]
Which format of the next generation DVD Which format of the next generation DVD will be more popular in the market in 5 will be more popular in the market in 5
years? years?
Alternatives: Blu-ray vs. HD DVD
Blu-ray HD DVD
Content Network
20th Century Fox, Apple,
Dell, Disney, LG, Lion’s
Gate, Paramount, Philips,
Sony (Columbia and MGM),
Warner
Paramount, Universal,
Warner
Player NetworkLG, Phillips,
Samsung, Sony
LG, RCA, Toshiba
Gaming Network
Sony PS3 (integrated),
Electronic Arts (EA)
Microsoft Xbox 360(external)
Storage (dual layer)
50GB (9 hrs of HD video)
30GB (5 hrs of HD video)
Cost/Disc* ~$1.59 ~$1.45
Disc Player Price
$500 (PS3) - $1000 $500 - $800
Model Overview• Strategic Criteria
– Personal Preference– Popularity– Application – Performance – Availability
BOCR I
Model Criteria Sub-criteriaBenefit Economic Convenience
Technology Disc /Supporting NetworksSocial PersonalRegulatory Regulation
Opportunity Economic Market penetration/ PriceTechnology Availability/ Performance/OperationSocial International markets/ Supporting networksRegulatory Regulation
Cost Economic Price/ Market penetrationTechnology R&DSocial International markets/ Supporting networksRegulatory Regulation
Risk Economic Product/ Threat of substituteTechnology Threats
BOCR II
• BOCR rating
Technology Opportunity subnet
• Inner-Subnet under criterion
Sensitivity Analysis (Cost)When the priority of Cost is less than about 0.3, Blu-ray is the format that will be more popular in the market.
However, as the priority of Cost becomes greater, none of the two DVD format will dominate the market.
Model Synthesis• Priority of alternatives
Hierarchy for Rating Opportunities, Costs and
Risks
Stem Cell Decision (ANP)
H u m a n W e ll-b e in g 0 .5 4 0Q uality of Life :0 .875Entrepreneurship :0 .125
S o c ia l F a c to r : 0 .2 9 7D ivers ity : 1 .000
P o lit ic a l F a c to rs : 0 .1 6 3Public O pinion: 0 .667Politica l Integrity :0 .333
Values in Evalua ting M erits
Priorities of Criteria and Subcriteria Criteria Subcriteria Global
priorities
Opportunities Medical advancement (0.631)
Medical treatment (0.750)
0.473
Economic profits (0.250)
0.158
Social (0.369) Oversight (1.000) 0.369
Costs Funding (0.602) 0.602
Commercialization (0.398) 0.398
Risks Medical development (0.393)
Losing competition(1.000)
0.393
Social risks (0.607) Moral issue (0.690) 0.419
Religious issue (0.310)
0.188
STEM CELL Decision Network for Four Criteria: Medical Treatment, Oversight, Funding, Moral Issue and Religious Issue
Stem Cell Research Decision ( AHP)Hierarchy for Rating Opportunities, Costs and Risks
Priority Ratings for the Merits: Opportunities, Costs and RisksVery High (0.419), High (0.263), Medium (0.160), Low (0.097), Very Low
(0.061)
H u m a n W e ll-b e in g 0 .5 4 0Q uality of Life :0 .875Entrepreneurship :0 .125
S o c ia l F a c to r : 0 .2 9 7D ivers ity : 1 .000
P o lit ic a l F a c to rs : 0 .1 6 3Public O pinion: 0 .667Politica l Integrity :0 .333
Values in Evalua ting M erits
Criteria Opportunities Costs Risks
Human well-being (0.468)
Quality of life (0.875) Very high Medium High
Entrepreneurship (0.125)
High Low Very high
Social Factor (0.297)
Diversity (1.000) Low High High
Political factors (0.163)
Public opinion (0.667) Medium High Very high
Political integrity (0.333)
Very low Medium High
Priorities 0.352 0.262 0.386
Priorities of Criteria and Subcriteria
Alternatives
•Fund ASCR (Adult Stem Cell Research)
•Fund ESCR (Embryonic Stem Cell Research)
•No Funding
Alternatives
•Fund ASCR (Adult Stem Cell Research)
•Fund ESCR (Embryonic Stem Cell Research)
•No Funding
Medical Treatment
(0.750)
Economic Profits
(0.250)
Medical Advancement
(0.631)
Social(0.369)
(Oversight: 1.00)
Opportunities(0.352)
Funding(0.602)
Commercialization
(0.398)
Costs(0.262)
Medical Development
(0.393)
(Losing Competition
: 1.000) Moral Issues
(0.690)
Religious Issues
(0.310)
Social Risks(0.607)
Risks(0.386)
Stem Cell Research
Opportunities Costs RisksPriority of BOCR Merit 0.33 0.28 0.39
Ideal Normalized Ideal Normalized Ideal NormalizedConditional funding (ASCR) 0.702 0.350 0.576 0.304 0.699 0.350Continue funding (ESCR) 1.000 0.499 0.677 0.358 0.717 0.359Terminate funding 0.303 0.151 0.639 0.338 0.580 0.291
Stem Cell Opportunities, Costs and Risks Data and Synthesis
O/(CR) oO-cC-rRPriority of BOCR Merit (Using Ideals) (x OCR wts)
(Using Ideals)Conditional funding (ASCR) 1.744 -0.041Continue funding (ESCR) 2.059 0.050
Terminate funding 0.818 -0.126
Sensitivity Analysis Original priorities
(local)Priorities that begin to change the ranks
OCR Opportunities 0.352 0.126 and less
Costs 0.262 0.626 and more
Risks 0.386 0.711 and more
Criteria/subcriteria Medical advancement
0.631 0.932 and more
Funding 0.602 0.942 and more
Commercialization 0.398 0.058 and less
Medical development-Losing competition
0.393 0.105 and less
Moral issue 0.690 0.908 and more
Religious issue 0.310 0.671 and more
ANWR
Arctic National Wildlife Refuge
ANWR Situation
• ANWR- Arctic National Wildlife Refuge
• Size- 19 Million Acres; Area 1002-1.5 Million Acres of Coastal Plain
• Protected in 1960-Eisenhower
• Land Compromise Carter Admin.
• Efforts to Re-open for Exploration- Bush
• Counter efforts to stop Exploration
Introduction to the ANWR situationANWR-Arctic National Wildlife Refuge covers 19 million acres on the Northern coast of Alaska. The entire refuge lies north of the Arctic Circle and 1,300 miles south of the North Pole. The Coastal Plain area comprising 1.5 million acres on the northern edge of ANWR, is bordered on the north by the Beaufort Sea, on the east by the U.S. Canadian border and on the west by the Canning River. The consensus of the geologic community is that the Coastal Plain of ANWR represents the highest petroleum potential onshore area yet to be explored in North America. If explored, it is estimated that it will take 15 years or more before oil and gas will reach the market. This coastal plain area, also known as area 1002, was originally protected in 1960 by President Eisenhower. Twenty years later President Carter signed the Alaska National Interest Conservation Act. This legislation was important as it created a majority of the National Parks in Alaska and expanded ANWR to its current size. A compromise was reached to pass the legislation, in return for designating a majority of the area-protected land; area 1002 was left unprotected and thus open for exploration. Each administration since has had its own opinion regarding the land and what should be done with it.The Reagan Administration was ready to drill but was derailed by the Exxon Valdez catastrophe. Similarly the first Bush Administration was unsuccessful. The Clinton Administration designated the area for protection and it has been since. The second Bush Administration, in response to ongoing Middle East violence and 9/11 terrorist attacks, sees drilling in ANWR as vital not only for economic but also for national security reasons. Several environmental groups consider ANWR a great American natural treasure and one of the last places on earth where an intact expanse of arctic and sub-arctic lands remain protected. They feel that the habitat, the wildlife, and the culture need to be protected from the exploration of gas and oil.The following Super Decisions model was formed as a way to arrive at a decision regarding the use of this land. This model incorporates pair-wise comparisons of benefits, opportunities costs and risks associated with drilling or not drilling. By making these comparisons and choosing the answers that best represent the use of the land we are able to come to a plausible conclusion as to whether or not this area should be further explored.
Overview of Model
Cluster Matrix Overview
Benefits Costs Opportunities Risks
Economic Local labor increase Labor Local business Reliance on Foreign Oil
Less reliance on foreign oil. Raw Materials ROI Investments
Local resources Infrastructure Exports Other energy sources
Property values Property Value Tax Jobs
Taxes Taxes
Political Taxes Taxes Lobbying Local image
Less reliance on foreign oil. Assessment Time Clout National image
Elections Political Fallout National support Elections
Clout World wide instability Community support
Social Revitalization Environmental Development Health
Development Crime Jobs Environmental
Public Programs Inconvenience Jobs
Oil companies contributions Noise CulturalTaxes to fund Ecological Programs Cultural
Benefits -Economic Decision Subnet
Do Not Drill for Oil .235
Drill for Oil .765
.225
.098
.178
.435
.063
Benefits -Political Decision Subnet
Do Not Drill for Oil .312
Drill for Oil .688
.105
.326
.453
.116
Benefits -Social Decision Subnet
Do Not Drill for Oil .225
Drill for Oil .775
.301
.065
.106
.340
.188
Overall Priorities
Benefits Do Not Drill for Oil .252
Drill for Oil .748
Opportunities Do Not Drill for Oil .165
Drill for Oil .835
Costs
(most costly)
Do Not Drill for Oil .238
Drill for Oil .762
Risks
(most risky)
Do Not Drill for Oil .644
Drill for Oil .356
Ratings for BOCR
Benefits .425
Opportunities .380
Costs .047
Risks .148
Results
Should 77.7%
Should not 22.3%
Should 78%
Should Not 22%
Splitting 6% Unsure Vote
Three Auto Industry Models
1. Best strategy for Ford with respect to the Ford Explorer/Firestone tire controversy
2. Should Porsche, a luxury car maker, introduce a Sports Utility Vehicle (SUV)?
3. Validation Exercise: Estimating the market share of Toyoto
Ford Explorer/Firestone Tire
What is the best strategy for the Ford Company to follow for its Ford Explorer SUV? It has been a very popular brand in recent years, but a series of accidents involving Explorers with Firestone tires has tarnished its image. There are four possible strategies that Ford can follow:
1. Discontinue Explorer2. Redesign the model3. Maintain the current model4. Maintain the current model and change the tire
supplier
Top Level View of Model : Benefits, Costs and Risks
Benefits Costs RisksEconomicSocial
EconomicPoliticalSocial
EconomicSocial
The Six Decision Networks under Benefits, Costs and Risks
Macro View of the Decision Network under Benefits, Economic
Expanded View of the Decision Network under Benefits: Economic
Expanded View of the other Decision Network under Benefits: Social
Expanded View of the Economic Decision Network under Costs
The Strategic Criteria used to Rate and Normalized Benefits, Costs and Risks
Alternatives B/(CR) bB-cC-rR Unitized
(Using Ideals) Normalized (Using Ideals) (Divide by 0.173)
Discontinue Explorer 0.171 0.113 0.334 1.931Redesign Model 1 0.659 0.376 2.173Maintain Current Model 0.024 0.016 -1.000 -5.780Maintain Model, Change Tire Supplier 0.322 0.212 -0.173 -1.000
Results of Ford Strategy ModelShown using Three Methods of
Synthesizing the Benefits, Costs and Risks
The Best Strategy for Ford under any Method of Synthesis is to Redesign the Explorer Model
Should Porsche enter the SUV Market?
Should Porsche, a manufacturer of luxury sports cars and the world’s most profitable automaker, have introduced a Sports Utility Vehicle (SUV)? Is the decision justified financially, socially and politically with respect to Benefits, Opportunities, Costs, Risks?
The Alternatives are:•Introduce SUV•Do not introduce SUV
Top Level View of Model : the Benefits, Costs and Risks
The Twelve Decision Networks under Benefits, Costs, Risks and Opportunities
Benefits Opportunities Costs RisksFinancialSocialPolitical
FinancialSocialPolitical
FinancialSocialPolitical
FinancialSocialPolitical
Two Representative Decision Networks(decision networks are bottom level subnetworks)
Benefits, Financial
Results in this subnetwork: Do not introduce SUV .42Introduce SUV .58
Benefits, Political
Results in this subnetwork:Do not introduce SUV .30Introduce SUV .70
Risks, Political
Results in this subnetwork (in terms of MOST risky):Do not introduce SUV .68Introduce SUV .32
Results of Porsche SUV ModelShown using Three Methods of
Synthesizing the Benefits, Costs and Risks
The results seem overwhelming that Porsche should introduce an SUV and in fact they plan to introduce the first non-sports car in their 53-year history next year,the Cayenne: a four-door, four-seat vehicle with a tailgate and four-wheel drive.
Alternatives O/(CR) oO-cC-rR Unitized
(Using Ideals) Normalized (Using Ideals) (Divide by 0.68)
Do not introduce SUV 0.09 0.08 -1 -1.471Introduce SUV 1 0.92 0.68 1
Road More Traveled: Long Used to Going It Alone, Porsche Joins the SUV Crowd --- No. 1 in Profit, Tiny Car Maker Bets Big on New Cayenne; Independence Is at Stake --- A 4x4 That Does 160 MPH By Scott Miller. Wall Street Journal. (Eastern Edition). New York, N.Y.: Aug 21, 2002. p. A.1
Copyright Dow Jones & Company Inc Aug 21, 2002 ZUFFENHAUSEN, Germany -- The world's most profitable car company doesn't report quarterly results to investors. Its profit outlooks are defiantly vague. It typically starts every fiscal year with the promise: "We expect profits and sales to at least match the previous year."
Now Porsche is about to put its results at risk, uncharacteristically succumbing to the lure of the most conventional of all auto-industry trends: the SUV. This week the maker of the legendary 911 and the sleek Boxster convertible will roll out the Cayenne, the first non-sports car in Porsche's 54-year history.
ANP Applications (cont.)
• Forecasting the Date of a Turnaround in the U.S. Economy
• Estimating the Market Shares of Fast Food Restaurants (McDonalds, Wendy`s, Burger King)
• Decision by the U.S. Congress on China`s Trade Status• Where to Dispose of Nuclear Waste• Whether or not to Commit U.S. to the Deployment of a
Nationale Missile Defense System
Special Projects
The Most Hopeful Outcome in the Middle
East Conflict
Our analysis is carried out in three steps:
1. Developing control criteria, and subcriteria for each of the BOCR, performing pairwise comparisons, and then prioritizing them.
2. Developing decision networks and synthesizing the priorities for each of the control criteria and then also for each of the BOCR and then all four BOCR merits to obtain the final outcome.
The Conflict in the Middle East
3. Rating the benefits, opportunities, costs, and risks (BOCR) merits of resolving the conflict to Middle East Peace, International Politics, and Human Well-being.
1. Interminable Confrontation: This is the ongoing confrontation and conflict as we know it today through military and other actions of bloodshed.
2. Enforcement & Supervision of Settlement: This is to supervise negotiation between Israel and the Palestinians by international organizations, and enforce implementation of the agreements.
ALTERNATIVES
3. Strict & Legal Settlement without Enforcement: This is to force both Israel and the Palestinians to observe their mutual agreement by legal means, by the UN, and by world public opinion.
4. Good Faith Settlement as in the Rabin era: This is to maintain or establish a peace treaty designed to avoid military confrontations through carrying it out in a friendly way only between Israel and the Palestinians.
5. Economic Assistance to the Palestinians: This is to help the Palestinians with economic development, education, and more generally planning a promising future.
Strategic Criteria
Three strategic criteria along with subcriteria are developed to evaluate the priorities of the BOCR merits. They are:
• Middle East Peace, • International Politics, • Human Well-Being.
Strategic criteria:
Middle East Peace. The Israeli-Palestinian conflict has largely affected the interests of several other countries including Arab, the U.S., and other countries. Resolution of the conflict is expected to eventually lead to peace in the Middle East. Acknowledgement of a Palestinian State can help permanent peace with social integration and graduate consensus on the issue. Also, security concern means that increasing one country’s security can inevitably decrease the security of the other.
International Politics. The Israeli-Palestinian conflict has been related to the international political sphere by affecting the foreign policy andmilitary outlook of other countries not directly involved in the conflict, such as Russia and Saudi Arabia for diplomatic outlook, and Iraq, Iran, and North Korea for military outlook.
Human Well-being. This is one of the aspirations to which resolving the conflict would contribute in no small measure. The conflict could lead to use of nuclear weapons by terrorists thus inviting retaliation against nations not directly responsible and eventually leading to a global conflagration. Human well-being is divided into capital investment, economic development, and religious concerns. Capital investment is driven by the economic effort to resolve the conflict and the hope that it would ultimately benefit all the people. Economic development also leads to rebuilding economies that have been stagnant due to the long lasting conflict. Religious concerns refer to tensions between East and West, and more significantly between Islam and Christianity that have taken place since the event of September 11, 2001.
Evaluating the BOCR Merits
Middle East Peace 0.569• Acknowledgement of Palestinian State: 0.518• Security Concerns: 0.165• Social Integration: 0.318
International Politics 0.129• Diplomatic Relations: 0.677• Military Relations: 0.323
Capital Investment: 0.540
Economic Development: 0.301
Religious Concerns: 0.159
• Capital Investment: 0.540• Eco. Dev. 0.301• Relig. Conc: 0.159
Human Well-Being0.301
Benefits Opportunities Costs Risks
Middle East Peace Acknowledgement of Palestinian StateVery High High Very High High
Security Concerns Low Low High HighSocial Integration High Medium High Medium
Int. Politics Diplomatic RelationsHigh Low Very High High
Military Relations Medium Very Low Medium MediumCapital Investment High Medium Very High High
Human Well-Being Economic DevelopmentHigh Medium High MediumReligious Concerns Medium Low Medium Medium
Priorities 0.278 0.169 0.328 0.226
Priority Ratings form the Merits: Benefits, Opportunities, Costs and Risks
Very High (0.42), High (0.26), Medium (0.16), Low (0.1), Very Low (0.06)
The parties are :
• the U.S. and Israel, • Palestinian and Arab countries (both friendly and hostile), • U.S. allies (European and other) including the U.N.
To save time and effort, we did not consider China, Russia, or India as sufficiently influential to include in our prioritization process.
Benefits
Opportunities
Costs
Risks
Sample Decision Network for Leadership Benefits
ISRAEL/US
ALTERNATIVES PALESTINE/ARAB
OTHERS
LEADERSHIP NETWORK
Each control criteria has a network of actors and their influences.
ISRAEL/US
ALTERNATIVES PALESTINE/ARAB
PUBLIC SUPPORT COST NETWORK
These decision networks show the relationship of each of the actors with respect to alternatives.
Pairwise ComparisonThe judgments are entered using the fundamental scale of the ANP: a criterion compared with itself is always assigned the value 1 so the main diagonal entries of the pairwise comparison matrix are all 1. The numbers 3, 5, 7, and 9 correspond to the verbal judgments “moderately more important”, “strongly more important”, “very strongly more important”, and “extremely more important” (with 2, 4, 6, and 8 for compromise between the previous values). Reciprocal values are automatically entered in the transpose position.
Acknowledgement of Palestinian Rights
Foreign Relations
Peace Treaty
Normalized Priority
Acknowledgement of Palestinian Rights
1 2 4 0.557
Foreign Relations 1/2 1 2 0.294Peace Treaty 1/4 1/2 1 0.149
Political Costs Criteria’s Pairwise Comparison Matrix
Local Global Normalized Priorities Priorities Priorities
Benefits Economic Arms Control 0.651 0.080 0.4180.278 0.444 Economic Support from Int’l Org. 0.137 0.017 -
Revitalization of Trade 0.212 0.026 -Political Leadership 0.716 0.043 0.222
0.215 Support from Other Countries 0.284 0.017 -Social Improve Understanding between Islam and Christianity0.273 0.026 -
0.342 Social Integration 0.727 0.069 0.360Opportunities Economic Economic Development of Middle East0.649 0.022 -
0.169 0.197 Revitalization of Oil Industry 0.351 0.012 -Political Agreement on Establishing Palestinian State0.368 0.031 0.288
0.500 Protection of Allies 0.098 0.008 -Security of Israel 0.534 0.045 0.417
Social Peace Settlement 0.625 0.032 0.2950.302 Possibility of Jewish Capital Investment0.375 0.019 -
Costs Economic Decrease in Defense Industry 0.618 0.034 0.1220.328 0.170 Resettlement Costs 0.382 0.021 -
Political Acknowledgement of Palestinian Rights0.557 0.094 0.3320.512 Foreign Relations 0.294 0.049 0.175
Peace Treaty 0.149 0.025 -Social Availability of Jewish Capital 0.319 0.033 0.118
0.318 Public Support Costs 0.681 0.071 0.252Risks Economic Environmental Concerns 0.314 0.012 -
0.226 0.168 Opposition to flow of Jewish Capital 0.686 0.026 -Political Split of Allies 0.371 0.042 0.256
0.506 Terrorism 0.629 0.072 0.435Social Religious Conflict 0.306 0.023 -
0.326 Split of Public Opinion 0.694 0.051 0.309
Merits Criteria Subcriteria
CRITERIA AND THEIR PRIORITIES
• Among these 27 criteria, the criteria with the highlighted priorities are used to do the analysis.
• The sum of the priorities of these 14 criteria accounts for 74.6% of the total. These criteria’s priorities are above 0.030.
• We then renormalize 14 control criteria’s priorities within their respective merits.
AlternativesArms Control
(0.418)Leadership
(0.222)
Social Integration
(0.360)
Final Outcome
Interminable Confrontation
0.235 0.251 0.212 0.083
Economic Assistance to Palestinian
1.000 1.000 1.000 0.362
Enforcement & Supervision of
Settlement0.717 0.752 0.707 0.258
Good Faith Settlement 0.365 0.396 0.315 0.124
Strict & Legal Settlement 0.498 0.527 0.455 0.173
.Benefits’ Overall Results
Costs (0.328)
Economic Assistance to the PalestiniansEnforcement & 0.258 0.230 0.125 0.161Supervision of
Opport. (0.169)Risks(0.226) Final Outcome
Interminable Confrontation0.083 0.082 0.347 0.275 -0.139
Alternatives Benefits (0.278)
0.1090.362 0.402 0.088
0.124 0.135 0.254
0.135
0.033
0.192 -0.031Strict & Legal Settlement
0.173 0.151 0.186
0.237 -0.080Good Faith Settlement
Overall Results bB+oO-cC-rR
• The final outcome suggests that the best policy to mitigate the Middle East Conflict is to provide the Palestinians with economic assistance. As of now, this policy has never been considered to be essential in resolving the conflict by any of the actors.
CONCLUSION
•Traditional negotiations have not moved to the conflict closer to resolution because of lack of a strong recognition of the need to give the Palestinians compensation for at least lots of their properties and perhaps make sure that matters have been evenly balanced as far as they feel their rights are concerned.
Furthermore, this kind of resolution does not focus as much on land, territory, and military action as much as it does on humane values and long term future relations.
SENSITIVITY ANALYSISA) BENEFITS AND OPPORTUNITIES
Benefits 0.278 0.5 the economic assistance policy is still preserved as the best policy as among the five alternatives. Enforcement & supervision of settlement outcome keeps becoming the second best policy as the benefits priority increases.
Opportunities 0.169 0.5
the economic assistance policy is preserved as the best policy as well. Also, enforcement & supervision of settlement still turns out to be the second best policy and interminable confrontation is expected to be the least recommendable policy.
No matter how much we increase or decrease the priorities of benefits and opportunities, the overall rank of the final outcome is preserved although these experiments change the magnitudes of the superiority of the best alternative.
SENSITIVITY ANALYSISB) COSTS AND RISKS
Costs 0.328 0.5 the economic assistance policy still turns out to be the best policy to deal with.
Risks 0.226 0.5 the economic assistance policy is still preserved as the best policy
Opportunities 0.169 0.5
the economic assistance policy is preserved as the best policy as well. Also, enforcement & supervision of settlement still turns out to be the second best policy and interminable confrontation is expected to be the least recommendable policy.
No matter how much we increase or decrease the priorities of benefits and opportunities, the overall rank of the final outcome is preserved although these experiments change the magnitudes of the superiority of the best alternative.
Question/Goal:
What should the U.S. foreign policy be with
regard to Iraq?
Background of the Problem
• What has brought us to this question? - For 10 years, Iraq has been under UN sanctions
for refusal to comply with UN resolutions mandating WMD inspections
- The Bush Administration’s rhetoric has emphasized the idea of U.S. hegemony, providing a foundation for unilateral, pre-emptive action
- Citing a sincere concern for Iraq’s possession/use of WMD, the U.S., backed by its “War on Terrorism”, intends to pursue an agenda of aggression against Iraq
The Four Alternatives
(1) The U.S. should make a unilateral, pre-emptive attack against Iraq
(2) The U.S. should attack Iraq only with Allied support and/or help
(3) The U.S. should exhaust diplomatic options by working with UN weapons inspectors to ensure inspections
(4) Sanctions against Iraq should be removed
Possible OutcomesOption 1 : Pre-emptive, Unilateral Action• Pro: A unilateral, pre-emptive attack may do the most
to “disarm” Iraq of potential WMD, by seeking and destroying any weapons-making programs or facilities by air or ground force. Additionally, it would serve well the U.S. goal of regime change.
• Con: A unilateral, pre-emptive attack might alienate the United States from her allies (and future allied support), might threaten the legitimacy and/or future viability of the U.N., may provoke Iraq into using any current WMD as retaliation and, further, might cause a potential increase both in terrorism and/or negative Arab sentiment towards the United States. Additionally, a unilateral strike would place all cost concerns and future Iraqi nation-building upon the U.S.
Possible OutcomesOption 2 : Attacking only with Allied Support• Pro: : Attacking only with Allied help and/or
support would be a slightly more cautious approach that would still target potential Iraqi WMD threats without alienating American allies or threatening the viability of International Governmental Organizations (IGOs, such as the U.N.) Moreover, it would share the burdens of monetary cost and future peacekeeping/nation-building.
• Con: Attacking Iraq, even with allied help, would still result in Iraqi retaliation that might result in use of biological or chemical WMD. Additionally, this action might serve to further polarize the Arab and Western worlds.
Possible OutcomesOption 3:Working with the U.N. to exhaust Diplomatic
Options• Pro: : Exhausting diplomatic options by working with
U.N. weapons inspectors would not only uphold the future viability of the UN (and respect for the UN Security Council), but might also serve the intended purpose of determining if/where Iraq has WMD or means to proliferate WMD. This option serves to respect sovereignty, limit cost, and champion diplomacy.
• Con: Having a decade-long history of non-cooperation with U.N. weapons inspectors, allowing Iraq to continue to draw out the situation may simply give them more time to create WMD, while also mocking the usefulness and viability of the United Nations.
Possible OutcomesOption 4: Remove Sanctions• Pro: Removing sanctions might result in an improved
quality of life for the Iraqi people, since many believe that the U.N. sanctions have little to no effect on Saddam Hussein and, instead, merely serve to hurt the Iraqi people and give credence to Hussein’s villianization of the United States.
• Con: Removing sanctions might serve to remove a great deal of credibility from the U.N. as an organization, to threaten future sanction enforcement attempts, and to reduce the viability of future UN operations. Further, removing sanctions might relinquish any leverage that the UN has on Hussein’s power and capacity to proliferate and use WMD, giving him a dictatorial carte blanche.
Consideration of Strategic Criteria• Economic : 1. Monetary Cost of War
2. Change in Oil Prices3. Focus Shift Away from
U.S.Economy
• Social : 1. Public Opinion
2. Iraqi Civilian Life
• Political : 1. Regime Change2. Allies Reaction3. Arab World Reaction
• Military : 1. WMD2. U.S. Military Casualties3. Removal of Dictator
Benefits, Opportunities, Costs & Risks: The BOCR model
• In the BOCR model, the Benefits model indicates which
alternative would be most beneficial while the Opportunities
model shows which alternative would provide the greatest
opportunities.
• Similarly, the Risk model designates which alternative has
the highest associated risk, and the Costs model shows
which alternative would be most costly.
• It is important to recognize, however, that the model is
being created & evaluated in regards to a U.S. policy option.
Therefore, Benefits does not necessarily indicate which
Alternative would be most beneficial to other countries,
including Iraq.
BOCR Ratings
Benefits Subnet
Opportunities Subnet
Costs Subnet
Risks Subnet
Synthesized ResultsThese are the results obtained using the Additive Formula with Reciprocals
Comments or Questions??
Decision Making in a Complex Environment
April 6, 2004
Megan Farkasovsky
Ania Greda
How should companies staff their application development function?
Background
• Outsourcing– Strategy is decades old
– 1950s: Manufacturers moved jobs offshore
• IT Outsourcing– ~1990: Legacy system maintenance sent to places like Ireland and
Canada (low-cost regions)
– 1995-2000: Y2K changes outsourced for hard-to-find skills (i.e., COBOL)
– 2001-today: Trend continuing with outsourcing more applications development tasks
Background (cont.)
• Continuing budget pressures on firms
• View of IT as a “no win” function
• Specialized service providers exist
• Telecommunications improved
• Collaboration tools available
• Low-cost labor
• Soft costs and risks
The Model: Goal
The Model: Alternatives
Needs &Requirements
Definition
Analysis &Design
Program/Code TestMove to
Production
Alternative #1 - Outsource all applicationdevelopment work
Alternative #2 - Outsource design andprogramming phases
Alternative #3 - Do not outsource any application development work
The Model: Strategic Criteria
• Picture 2
STRATEGIC CRITERIA
FINANCIAL 0.4476 TECHNOLOGY 0.1605Availability of experts 0.6667Flexibility 0.3333
TIME-TO-MARKET 0.2562 SOCIAL 0.1357Media perception 0.2500Shareholder & employee perception 0.7500
The Model: Ratings ScaleTable 1. Strategic criteria scale for ratings
Availability of experts (0.0826)
Shareholder &
employee perception (0.0785)
Media perception (0.0262)
Financial (0.3453)
Flexibility (0.0413)
Time–to-market (0.1977)
Immediately (0.6267)
Very supportive (0.4626)
Very supportive (0.4626)
High possibility to reduce costs (0.5909)
Hi (0.6267)
Fast (0.4626)
Moderately (0.2797)
Moderately supportive (0.3073)
Moderately supportive (0.3073)
Moderate possibility to reduce costs (0.2754)
Medium (0.2797)
Moderately fast (0.3073)
Delayed (0.0936)
Neutral (0.1416)
Neutral (0.1416)
Somewhat unlikely to reduce costs (0.0905)
Low (0.0936)
Average (0.1416)
Moderately unsupportive (0.0584)
Moderately unsupportive (0.0584)
Unlikely to reduce costs (0.0432)
Moderately slow (0.0584)
Very unsupportive (0.0299)
Very unsupportive (0.0299)
Slow (0.0299)
The Model: Alternatives’ Ratings
Table 2. Rating Importance of Benefits, Opportunities, Costs and Risks
Availability of experts
Shareholder &
employee perception
Media
perception
Financial
Flexibil
ity
Time–
to-market
Priorities
Benefits
Immediately Moderately
unsupportive Moderately
unsupportive High possibility to reduce costs
Hi
Fast
0.2983
Opportunities
Immediately Moderately supportive Moderately supportive
High possibility to reduce costs
Hi
Fast
0.1051
Costs
Moderately Moderately
unsupportive Moderately
unsupportive Somewhat unlikely to
reduce costs
Med
Average
0.2983
Risks
Immediately Moderately unsupportive
Moderately unsupportive
High possibility to reduce costs
Hi
Fast
0.2983
Table 3. Clusters in the Decision Networks and Elements in the Clusters: Benefits & Opportunities
BOCR Control Criteria
Clusters Elements in Clusters
Financial 1 IT assets, 2 Personnel, 3 Legal Economic Operational 1 Time to finish project / job, 2 Use of project management, 3
Knowledge transfer during requirements def, 4 Control / influence over human resources, 5 Fast time-to-market
Technology 1 Leverage solutions from prev. business problems, 2 Newest technology available
Benefits
Technological
Resources 1 Knowledge of latest technologies, 2 Immediately available
Customer base 1 Grow into other countries, 2 Customer retention Customer - related Marketing 1 Agile, quick response to customer requests, 2 New features /
functionality
Business development
1 Expansion into foreign countries, 2 Expand product line
Financial 1 Make investments, 2 Reduce debt
Opportunities
Economic
Employees 1 Focus - quality assurance of software, 2 Focus - firm's core capabilities, 3 Focus - software alignment with business, 4 Productivity
Picture 3. Benefits model
Picture 4. Clusters with elements under Economic Benefits
Picture 5. Clusters with elements under Technological Benefits
Picture 5. Opportunities model
Picture 6. Clusters with elements under Economic Opportunities
Picture 7. Clusters with elements under Customer-related Opportunities
Table 3. Clusters in the Decision Networks and Elements in the Clusters: Costs & Risks (cont.)
Financial 1 IT assets, 2 Personnel, 3 Legal
Operational 1 Time to finish project / job, 2 Use of project management, 4 Knowledge transfer during requirements def, 4 Control / influence over human resources, 5 Time-to-market
Economic
Resources 1 Knowledge of latest technologies, 2 Immediately available
Stakeholders 1 Company shareholders perception, 2 Media criticism, 3 Company executives / managers perception, 4 Company employees perception
Costs
Social
Labor 1 US unemployment, 2 Employee morale, 3 Control / influence over human resources, 4 Productivity
Financial 1 Legal costs
Business processes
1 Business process knowledge, 2 Business continuity, 3 Quality assurance
Security 1 Physical, 2 Intellectual property, 3 Geopolitical environment - stability
Economic
Communication 1 Geographic distance, 2 Communication tool availability - email voice mail, 3 H-1B and L-1 visa availability, 4 Language differences
Labor 1 Employee morale, 2 Productivity, 3 US unemployment
Risks
Social Stakeholders 1 Company shareholders perception, 2 Media criticism, 3 Company executives /
managers perception, 4 Company employees perception
Picture 8. Costs model
Picture 9. Clusters with elements under Economic Costs
Picture 10. Clusters with elements under Social
Costs
Picture 11. Risks model
Picture 12. Clusters with elements under Economic Risks
Picture 13. Clusters with elements under Social Risks
Example: Social Risk Pairwise Comparison Pair-wise comparisons for “Labor” wrt to “2 Outsource the design.”
Question: With respect to “2 Outsource the design.” where the firm realizes more Labor Risks? 1 Em 2 Pr 3 US Vec. Wts.
1 Employee morale 1 4 3 0.6250 2 Productivity 1 1/2 0.1365 3 US unemployment 1 0.2385
Pair-wise comparisons for “1 Alternatives” wrt to “3 US unemployment ” Question: With respect to “3 US unemployment” which Alternative is more risky?
1 Out 2 Out 3 Do not Vec. Wts. 1 Outsource all... 1 1 3 0.4286 2 Outsource the d. 1 3 0.4286 3 Do not outsource 1 0.1429
Pair-wise comparisons for “Stakeholders” wrt to “1 Outsource all appl.” Question: With respect to “1 Outsource all appl.” where the firm realizes more Stakeholders Risks?
1 Co 2 Me 3 Co 4 Co Vec. Wts.
1 Company shareholders per. 1 1/4 1/2 1/3 0.1009 2 Media criticism 1 1/2 1/2 0.2293 3 Company executives/managers perc. 1 1/2 0.2674 4 Company employees perception 1 0.4024
Example: Economic Risk Pairwise Comparison
Pair-wise comparisons for “Communication” wrt to “1 Outsource all appl.” Question: With respect to “1 Outsource all appl.” where the firm realizes more Communication Risks?
1 Ge 2 Co 3 H-1B 4 La Vec. Wts.
1 Geographic distance 1 1/5 1/4 1/4 0.2947 2 Communication tool avail. 1 2 2 0.1917 3 H-1B and L-1 visa avail. 1 1 0.2508 4 Language differences 1 0.2629
Pair-wise comparisons for “Security” wrt to “3 Do not outsource…” Question: With respect to “3 Do not outsource…” where the firm realizes more Security Risks?
1 Phy 2 Inn 3 Geo Vec. Wts. 1 Physical 1 1/2 1 0.2500 2 Intellectual property 1 2 0.5000 3 Geopolitical environment 1 0.2500
Pair-wise comparisons for “1 Alternatives” wrt to “1 Business process kn.” Question: With respect to “1 Business process kn.” which alternative is more risky?
1 Out 2 Out 3 Do not Vec. Wts. 1 Outsource all... 1 1 5 0.4545 2 Outsource the d. 1 5 0.4545 3 Do not outsource 1 0.0909
Final tables for “Outsourcing a Firm’s Application Development Group”Benefits Economic Technological Sum of wtd Alts
Normalized Control Criterion (CC) 0.8333 Col. 1 0.1667 Col. 2 Col. 1 + Col 2
Alternatives Idealized (CC Ideal) Idealized (CC Ideal) SUM
1 Outsource all application development 1.000 0.8333 1.000 0.1667 1.000
2 Outsource the design and programming 0.2766 0.2305 1.000 0.1667 0.3972
3 Do not outsource any application development work 0.1597 0.1331 0.2669 0.0445 0.1776
Costs Economic Social Sum of wtd Alts
Normalized Control Criterion (CC) 0.8333 Col. 1 0.1667 Col. 2 Col. 1 + Col 2
Alternatives Idealized (CC Ideal) Idealized (CC Ideal) SUM
1 Outsource all application development 0.7975 0.6646 1.000 0.1667 0.8313
2 Outsource the design and programming 0.7122 0.5935 0.9195 0.1533 0.7468
3 Do not outsource any application development work 1.000 0.8333 0.8552 0.1426 0.9759
Risks Economic Social Sum of wtd Alts
Normalized Control Criterion (CC) 0.7500 Col. 1 0.2500 Col. 2 Col. 1 + Col 2
Alternatives Idealized (CC Ideal) Idealized (CC Ideal) SUM
1 Outsource all application development 1.0000 0.7500 1.0000 0.2500 1.0000
2 Outsource the design and programming 1.0000 0.7500 1.0000 0.2500 1.0000
3 Do not outsource any application development work 0.2944 0.2208 0.5446 0.1362 0.3570
Opportunities Customer - related Economic Sum of wtd Alts
Normalized Control Criterion (CC) 0.2500 Col. 1 0.7500 Col. 2 Col. 1 + Col 2
Alternatives Idealized (CC Ideal) Idealized (CC Ideal) SUM
1 Outsource all application development 1.000 0.2500 1.000 0.7500 1.000
2 Outsource the design and programming 0.8655 0.2164 0.8151 0.6113 0.8277
3 Do not outsource any application development work 0.3477 0.0869 0.5385 0.4039 0.4908
Priority Ratings for the merits: Benefits, Opportunities, Costs and Risks
Strategic criteria Strategic sub-criteria Benefits Opportunities Costs Risks
Financial (0.3453) High possibility to reduce costs
High possibility to reduce costs
Somewhat unlikely to reduce
costs
High possibility to reduce costs
Technology (0.1605) Availability of experts (0.0826)
Immediately Immediately Moderately Immediately
Flexibility (0.0413) Hi Hi Medium Hi
Time-to-market (0.1977)
Fast Fast Average Fast
Social (0.1357) Media perception (0.0262) Moderately unsupportive
Moderately supportive
Moderately unsupportive
Moderately unsupportive
Shareholder & employee perception (0.0785)
Moderately unsupportive
Moderately supportive
Moderately unsupportive
Moderately unsupportive
Ratings Total 0,7386 0,7950 0,1998 0,7386
Normalized 0.2983 0.1051 0.2983 0.2983
Immediately (0.6267), Moderately (0.2797), Delayed (0.0936); [*Idealized: Immediately (1.0000), Moderately (0.4463), Delayed (0.1494)]
Very supportive (0.4626), Moderately supportive (0.3073), Neutral (0.1416), Moderately unsupportive (0.0584), Very unsupportive (0.0299)
[*Idealized: Very supportive (1.0000), Moderately supportive (0.6643), Neutral (0.3061), Moderately unsupportive (0.1262), Very unsupportive (0.0646)]
High possibility to reduce costs (0.5909), Moderate possibility to reduce costs (0.2754), Somewhat unlikely to reduce costs (0.0905), Unlikely to reduce costs (0.0432); [*Idealized: High possibility to reduce costs (1.0000), Moderate possibility to reduce costs (0.4661),
Somewhat unlikely to reduce costs (0.1532), Unlikely to reduce costs (0.0731)Hi (0.6267), Medium (0.2797), Low (0.0936); [*Idealized: Hi (1.0000), Medium (0.4463), Low (0.1494)]
Fast (0.4626), Moderately fast (0.3073), Average (0.1416), Moderately slow (0.0584), Slow (0.0299); [*Idealized: Fast (1.0000), Moderately fast (0.6643), Average (0.3061), Moderately slow (0.1262), Slow (0.0646)]
Sum of the BOCR merit priorities the “Totals” for their control criteria
Benefits (0.2983)
Opportunities(0.1051)
Costs(0.2983)
Risks(0.2983)
Alternatives Sum (from above)
(Sum0.2983) Sum (from above)
(Sum0.1051)
Sum (from above)
(Sum0.2983) Sum (from above)
(Sum0.2983)
1 Outsource all application development
1.0000 0.2983 1.0000 0.1051 0.8313 0.2480 1.0000 0.2983
2 Outsource the design and programming
0.3972 0.1185 0.8277 0.0870 0.7468 0.2228 1.0000 0.2983
3 Do not outsource any application development work
0.1776 0.0530 0.4908 0.0516 0.9759 0.2911 0.3570 0.1065
*If a sum column is not ideal, that is, the largest value is not 1.0, idealize by dividing by largest value in the column
Synthesis of the Alternatives in Two ways
BO/CR bB+oO-cC-rR
Alternatives (from unweighted columns in the table above)
Normalized (from weighted columns in the table
above)
1 Outsource all application development
1.2029 0.6353 -0.1429
2 Outsource the design and programming
0.4402 0.2325 -0.3156
3 Do not outsource any application development work
0.2502 0.1321 -0.2930
Example: Risk Sensitivity Graph
Disney in Greater ChinaDecision Making Final Project
Ling-Hui Lin Szu-Lun Peng
Agenda
• Problem Statement• Alternatives• Model Overview• Subnet• Inner Subnet• Model Synthesis• Sensitivity Analysis
• Main Goal of Walt Disney
– Making a minimal equity investment in any operating entity and generate most of its returns through royalty, licensing, and fee income streams
• Which Option is the Best to Disney in
Greater China.
Problem StatementProblem Statement
AlternativesAlternatives
• Hong Kong• Shanghai• Taiwan• Do not Invest in Greater China
ModelModel OverviewOverview
• Strategic Criteria– Competition
– International Characters
– Infrastructure
– Income Level
– Political Support
• BOCR model utilizing Internal Rating System
SubnetSubnet
• Control Criteria– Economic
– Social
Inner Subnet (Example)Inner Subnet (Example)Cost-EconomicCost-Economic
Model SynthesisModel Synthesis
Rating ModelRating Model
Sensitivity Analysis Sensitivity Analysis (Disney Decision)(Disney Decision)
ConclusionConclusion
• Hong Kong• Shanghai• Taiwan
• Do not Invest in Greater China
Iraqi War
When should the majority of US troops withdraw from Iraq?
Timeline
• Aug. 2, 1990 – Iraq invades Kuwait• Feb. 24, 1991 – Operation Desert Storm begins• Feb. 28, 1991 – Iraq agrees to a ceasefire• Sept. 11, 2001 – Twin Towers terrorist attack• Oct. 7, 2001 – Operation Enduring Freedom
begins against Afghanistan• March 20, 2003 – Operation Iraq Freedom begins• April 9, 2003 – Baghdad falls• May 1, 2003 – President Bush declares end of
major combat operations in Iraq
Background Model Setup Data Collection Final Results Problems
Timeline (continued)
• May 2, 2003 – Rumsfeld announces end of Afghanistan combat
• Dec. 13, 2003 – Saddam Hussein was captured• June 28, 2004 – U.S. transfers sovereignty to Iraq• Oct. 15, 2005 – Iraqis votes to ratify constitution• Dec. 15, 2005 – Iraqis vote to elect members of
Iraqi assembly• Mar. 21, 2006 – Bush announces U.S. troops will
remain in Iraq until at least 2009.
Background Model Setup Data Collection Final Results Problems
Background Highlights
• United States military troops have been in Iraq for 3 years
• The main policy questions center around how long the US should remain in Iraq
• Key question – “When should a majority of the United States military forces withdraw from Iraq?”
• Determining the alternatives
Background Model Setup Data Collection Final Results Problems
When should the majority of US troops withdraw from Iraq?
Alternative 1: Upon the request of the Iraqi
government
Alternative 2: After 5 years
Alternative 3: Within 2-5 years
Alternative 4: Within 1 year
Alternative 5:Withdraw within 3 months and redeploy troops
Background Model Setup Data Collection Final Results Problems
Strategic Criteria
Democracy in Iraq .337 Economic Development .092
Stable Government .717 US Energy Security .455
Iraqi National Defense .195 Market Creation .091
Minority Representation .088 Rebuilding Infrastructure .455
World Peace .185 US Domestic Politics .386
Terrorism Abroad .073 US National Security .750
Terrorism at Home .671 US Public Support .125
Future US Foreign Policy .256 US Military Relations .125
Strategic Evaluation of Withdrawing US Troops From Iraq
BOCR Model
Background Model Setup Data Collection Final Results Problems
Merits Criteria Sub-criteria Merits Criteria Sub-criteria
Benefits Economic Iraq Economy Costs Economic US Budget Deficit
US Economy International Coalition Costs
World Economy Political Creating New Enemies
Political Creating New Allies Potential Government Corruption
US Bargaining Power Iraq Initiative
US Presence in the Region Security Civil War in Iraq
Iraq Initiative Destabilization of the Region
Security Deterrence Social Human Life (Allies)
Anti-Terrorism Human Life (US)
Insurgency Warfare Training Human Life (Iraq)
Opportunities Economic US Economy Political US Reputation
Iraq Economy Risks Iraq Initiative
Political Protection of US Allies Security Increased Terrorism
Spread of Democracy
Democracy in Iraq
Iraq Initiative
Data CollectionSurvey
Data Collection
• Professors and PHD faculty– GSPIA– Katz
• Periodicals– Ex: Time, The Economist
• Government Studies– Ex: National Security Council : Iraq War Strategy
• Websites• Informal conversations
Background Model Setup Data Collection Final Results Problems
Spheres of InfluenceAl-Qaeda Iraqi Citizens Pentagon China
World Bank Shi'ites President France
World Humanitarian Organization Iraqi Women US Citizens
Great Britain
Religious Militant Groups Kurds US Corporations Iran
Enemies Iraq GovernmentUS Defense Industry Italy
Allies Iraq Insurgency US Congress Poland
World community Sunnis Press Russia
Foreign Corporations Iraq Congress Syria
Background Model Setup Data Collection Final Results Problems
Spheres of Influences
Model Representation
Benefits Control Criteria Breakdown of highlighted subnets to follow
US Economy Subnet
US Presence in Region Subnet
Opportunities Control CriteriaBreakdown of highlighted subnets to follow
US Economy Subnet
Iraq Economy Subnet
Costs Control CriteriaBreakdown of highlighted subnets to follow
US Budget Deficit Subnet
Civil War in Iraq Subnet
Risks Control CriteriaBreakdown of highlighted subnets to follow
US Reputation Subnet
Increased Terrorism Subnet
Criteria and Their PrioritiesMerits Criteria Sub-criteria
Global Priorities (Normalized)
Benefits Economic (.6144) Iraq Economy (.2184) 0.134
US Economy (.6301) 0.387
World Economy (.1514) 0.093
Political (.2684) Creating New Allies (.1992) 0.053
US Bargaining Power (.3115) 0.084
US Presence in the Region (.3363) 0.090
Iraq Initiative (.1529) 0.041
Security (.1172) Deterrence (.3535) 0.041
Anti-Terrorism (.3737) 0.044
Insurgency Warfare Training (.2727) 0.032
Opportunities Economic (.8333) US Economy (.7500) 0.625
Iraq Economy (.2500) 0.208
Political (.1667) Protection of US Allies (.2118) 0.035
Spread of Democracy (.5551) 0.093
Democracy in Iraq (.0808) 0.013
Iraq Initiative (.1524) 0.025
Background Model Setup Data Collection Final Results Problems
Criteria and Their Priorities
Merits Criteria Sub-criteriaGlobal Priorities
(Normalized)
Costs Economic (.0792) US Budget Deficit (.7031) 0.056
International Coalition Costs (.2969) 0.024
Political (.0462) Creating New Enemies (.6782) 0.031
Potential Government Corruption (.1424) 0.007
Iraq Initiative (.1794) 0.008
Security (.1731) Civil War in Iraq (.5099) 0.088
Destabilization of the Region (.4901) 0.085
Social (.7015) Human Life (Allies) (.2626) 0.184
Human Life (US) (.4040) 0.283
Human Life (Iraq) (.3333) 0.234
Political (.1250) US Reputation (.8002) 0.100
Risks Iraq Initiative (.1998) 0.025
Security (.8750) Increased Terrorism (1.0) 0.875
Background Model Setup Data Collection Final Results Problems
Weight Benefits and Opportunities
Background Model Setup Data Collection Final Results Problems
Benefits US Economy US Presence in the Region Sum of wtd Alt.
Normalized CC 0.811 0.189
Alternatives Idealized (CC x Ideal) Idealized (CC x Ideal)
1 year 0.470 0.381 1.000 0.189 0.570
2-5 years 0.291 0.236 0.305 0.058 0.294
> 5 years 1.000 0.811 0.049 0.009 0.820
Redeploy Troops 0.678 0.549 0.891 0.168 0.718
Iraq Request 0.375 0.304 0.353 0.067 0.371
Opportunities US Economy Iraq Economy Sum of wtd Alt.
Normalized CC 0.750 0.250
Alternatives Idealized (CC x Ideal) Idealized (CC x Ideal)
1 year 0.000 0.000 0.000 0.000 0.000
2-5 years 0.335 0.251 1.000 0.250 0.501
> 5 years 0.941 0.706 0.347 0.087 0.792
Redeploy Troops 1.000 0.750 0.877 0.219 0.969
Iraq Request 0.035 0.026 0.962 0.240 0.267
Weighted Costs and Risks
Background Model Setup Data Collection Final Results Problems
Costs Civil War in Iraq US Budget Deficit Sum of wtd Alt.
Normalized CC 0.613 0.387
Alternatives Idealized (CC x Ideal) Idealized (CC x Ideal)
1 year 0.519 0.318 0.104 0.040 0.359
2-5 years 0.308 0.189 0.481 0.186 0.375
> 5 years 1.000 0.613 1.000 0.387 1.000
Redeploy Troops 0.321 0.197 0.136 0.052 0.249
Iraq Request 0.366 0.224 0.269 0.104 0.328
Risks US Reputation Increased Terrorism Sum of wtd Alt.
Normalized CC 0.103 0.897
Alternatives Idealized (CC x Ideal) Idealized (CC x Ideal)
1 year 0.547 0.056 1.000 0.897 0.954
2-5 years 0.258 0.026 0.045 0.040 0.066
> 5 years 1.000 0.103 0.000 0.000 0.103
Redeploy Troops 0.390 0.040 0.289 0.259 0.299
Iraq Request 0.263 0.027 0.522 0.468 0.495
Final Results
Background Model Setup Data Collection Final Results Problems
Sum of the BOCR merit Priorities times the "Totals" for their control criteria
Benefits 0.2862 Opportunities 0.2397 Costs 0.2991 Risks 0.175
AlternativesSum (from previous)
(Sum x .2782)
Sum (from previous)
(Sum x .2275)
Sum (from previous)
(Sum x .3094)
Sum (from previous)
(Sum x .1848)
1 year 0.570 0.163 0.000 0.000 0.359 0.107 0.954 0.167
2-5 years 0.294 0.084 0.501 0.120 0.375 0.112 0.066 0.012
> 5 years 0.820 0.235 0.792 0.190 1.000 0.299 0.103 0.018
Redeploy Troops 0.718 0.205 0.969 0.232 0.249 0.074 0.299 0.052
Iraq Request 0.371 0.106 0.267 0.064 0.328 0.098 0.495 0.087
Short-term/Long-term Results
Background Model Setup Data Collection Final Results Problems
BO/CR bB+oO-cC-rR
Alternatives Unwtd Normalized Wtd Unitized
1 year 0.063 0.003 -0.111 -7.525
2-5 years 6.920 0.378 0.081 5.467
> 5 years 5.975 0.326 0.108 7.304
Redeploy Troops 4.875 0.266 0.311 21.105
Iraq Request 0.469 0.026 -0.015 -1.000
Results - Multiplicative
Background Model Setup Data Collection Final Results Problems
Results – Additive (Negative)
Background Model Setup Data Collection Final Results Problems
Sensitivity Analysis - Benefits
Sensitivity Analysis - Opportunities
Sensitivity Analysis - Costs
Sensitivity Analysis - Risks
Every Project should have a summary with the following figures andtables included
1. Title with brief explanation of what the problem is and why a decision is needed.2. BOCR networks compactly shown3. Table of the BOCR control criteria, subcriteria and their priorities4. Table of the priorities of the alternatives from each BOCR network nicely arranged5. Table of the synthesized priorities of the alternatives for each of the 4 BOCR 6. Strategic criteria and subcriteria and their priorities7. The intensity scale for rating the BOCR and table for rating the top alternative for each of the 4 BOCR as representative of that BOCR merit. Most costly and most risky alternative must be derived and used. The four priorities of the BOCR must be shown before and after normalization8. Table of overall synthesis of the priorities of the alternatives with the marginal formulas BO/CR and the total formula bB+oO-cC-rR
Top Related