Modeling and Decision Making -Under Certainty, Uncertainty, and Risk (2 of 2) The zones of decision making Increasing knowledge Complete Total Knowledge Risk lgnorance Certainty Uncertainty Decreasing knowledge Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Modeling and Decision Making - Under Certainty, Uncertainty, and Risk (2 of 2) • The zones of decision making
Application Case 6.3 American Airlines Uses should-Cost Modeling to assess the Uncertainty of Bids for Shipment Routes Questions for Discussion 1. Besides reducing the risk of overpaying or underpaying suppliers, what are some other benefits AA would derive from its“ shoulo-be”mode? 2. Can you think of other domains besides air transportation Where such a model could be used? 3. Discuss other possible methods with which Aa could have solved its bid overpayment and underpayment problem Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Application Case 6.3 American Airlines Uses Should-Cost Modeling to Assess the Uncertainty of Bids for Shipment Routes Questions for Discussion 1. Besides reducing the risk of overpaying or underpaying suppliers, what are some other benefits AA would derive from its “should-be” model? 2. Can you think of other domains besides air transportation where such a model could be used? 3. Discuss other possible methods with which AA could have solved its bid overpayment and underpayment problem
Decision Modeling with Spreadsheets Spreadsheet Most popular end-user modeling tool Flexible and easy to use Powerful functions(add-in functions) Programmability(via macros) What-if analysis and goal seeking Simple database management Seamless integration of model and data Incorporates both static and dynamic models Examples Microsoft Excel, Lotus 1-2-3 Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Decision Modeling with Spreadsheets • Spreadsheet – Most popular end-user modeling tool – Flexible and easy to use – Powerful functions (add-in functions) – Programmability (via macros) – What-if analysis and goal seeking – Simple database management – Seamless integration of model and data – Incorporates both static and dynamic models – Examples: Microsoft Excel, Lotus 1-2-3
Application Case 6.4 Pennsylvania Adoption Exchange Uses Spreadsheet Model to Better Match children with Families Questions for Discussion 1. What were the challenges faced by Pae while making adoption matching decisions? 2. What features of the new spreadsheet tool helped PAE solve their issues of matching a family with a child? Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Application Case 6.4 Pennsylvania Adoption Exchange Uses Spreadsheet Model to Better Match Children with Families Questions for Discussion 1. What were the challenges faced by PAE while making adoption matching decisions? 2. What features of the new spreadsheet tool helped PAE solve their issues of matching a family with a child?
Application Case 6.5 Metro Meals on Wheels Treasure valley Uses Excel to Find optimal Delivery Routes Questions for Discussion 1. What were the challenges faced by Metro meals on Wheels Treasure valley related to meal delivery before adoption of the spreadsheet-based tool? 2. Explain the design of the spreadsheet-based model 3. What are the intangible benefits of using the Excel- based model to metro meals on wheels? Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Application Case 6.5 Metro Meals on Wheels Treasure Valley Uses Excel to Find Optimal Delivery Routes Questions for Discussion 1. What were the challenges faced by Metro Meals on Wheels Treasure Valley related to meal delivery before adoption of the spreadsheet-based tool? 2. Explain the design of the spreadsheet-based model. 3. What are the intangible benefits of using the Excelbased model to Metro Meals on Wheels?