The fifth edition has been fully revised and updated and includes a number of changes to reflect the latest developments and research in the field.
- Includes a new chapter (Chapter 17) on combining scenario planning with decision analysis.
- Discusses the distinction between good and bad decisions and good and bad outcomes.
- Extends the discussion of second–order stochastic dominance by introducing a new, simple procedure to help decision makers determine whether stochastic dominance is present.
- Coverage of the Delphi method in Chapter 13 has been significantly extended and now includes research–based, step–by–step guides on how to apply the method for maximum effectiveness.
- Discussion on decision framing in Chapter 15 now includes an introduction to prospect theory, which is probably the most well–known theory of how people make decisions when they face risks.
- Scenario planning has been extended to include a case study detailing how the method was applied in the English National Health Service. The authors also contrast scenario planning with Nassim Taleb s recently published ideas about antifragility in decision making.
The book is intended for MBA students and business and management undergraduates who are not specialist mathematicians but it will also appeal to practising managers. The companion website can be found at: <a href="[external URL]
Foreword Lawrence D. Phillips vii
Chapter 1 Introduction 1
Chapter 2 How people make decisions involving multiple objectives 15
Chapter 3 Decisions involving multiple objectives: SMART 33
Chapter 4 Decisions involving multiple objectives: alternatives to SMART 65
Chapter 5 Introduction to probability 95
Chapter 6 Decision making under uncertainty 117
Chapter 7 Decision trees and influence diagrams 161
Chapter 8 Applying simulation to decision problems 187
Chapter 9 Revising judgments in the light of new information 221
Chapter 10 Heuristics and biases in probability assessment 245
Chapter 11 Methods for eliciting probabilities 275
Chapter 12 Risk and uncertainty management 297
Chapter 13 Decisions involving groups of individuals 309
Chapter 14 Resource allocation and negotiation problems 337
Chapter 15 Decision framing and cognitive inertia 361
Chapter 16 Scenario planning: an alternative way of dealing with uncertainty 387
Chapter 17 Combining scenario planning with decision analysis 423
Chapter 18 Alternative decision–support systems and conclusions 437
Suggested answers to selected questions 469