Multiple-Objective Decision Analysis Involving Multiple Stakeholders

Abstract

Many operations researchers know about the use of decision analysis to help decide among alternative investments (such as pharmacological research and development investments) using decision trees with chance nodes to compute expected monetary value or return on investment of different alternatives.Suc h an analysis often aims to maximize a single evaluation measure for a single decision maker.W e demonstrate less widely known decision analysis techniques using spreadsheet models that will help analysts understand and model the multiple objective perspectives of the stakeholders to a decision.Using this approach can aid in identifying mutually agreeable alternative actions, designing new and better alternatives, and foreseeing opposition to decisions. It can also help analysts understand the evolution of past decisions from multiple perspectives. In some cases, one objectives hierarchy can be suitable for a set of stakeholders, and differences in opinions across stakeholders can be characterized by differences in weights on the multiple objectives.Examples include the analysis for the merger of the Operations Research Society of America and The Institute of Management Sciences to become INFORMS, Arizona water resources planning, and planning for protection against radioactive iodine releases in nuclear incidents.In other cases, an objectives hierarchy will be constructed for each stakeholder because their objectives are so different that construction of separate hierarchies better represents their divergent perspectives.Examples include a tuna fish supplier source selection decision (from the perspectives of StarKist, environmentalists, and the San Diego tuna fishing fleet), the potential siting of a new Home Depot in San Juan Capistrano (from the perspectives of Home Depot, the city, residents, and competing or complementary small businesses), and a prostate cancer treatment decision (from the perspectives of former Intel CEO Andy Grove, his family, his company, and his doctors).