Decision Analysis (IE 405)

2021 Fall
Faculty of Engineering and Natural Sciences
Industrial Engineering(IE)
3
6
Hans Frenk frenk@sabanciuniv.edu,
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English
Undergraduate
MATH306
Formal lecture,Recitation
Communicative
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Programs\Type Required Core Elective Area Elective
Business Analytics Minor *
Computer Science and Engineering *
Computer Science and Engineering *
Data Science and Analytics *
Decision and Behavior Minor *
Energy Minor *
Industrial Engineering *
Industrial Engineering (Previous Name: Manufacturing Systems Engineering) *
Management *
Management *
Materials Science and Nano Engineering *
Materials Science and Nano Engineering (Previous Name: Materials Science and Engineering) *
Mechatronics Engineering *
Mechatronics Engineering *
Microelectronics *
Telecommunications *

CONTENT

Introduction to the theory and practice of decision processes under uncertainty; use of decision trees and influence diagrams in solving decision-making problems; assessing probabilities in modeling uncertainty; Bayesian statistical analysis; value of information; attitudes towards risk; and utility theory.

OBJECTIVE

The course provides a broad practical overview of topics and techniques in the field of decision analysis. As an engineering course for undergraduate students, the course will address advanced technical subjects that can be found in management science and operations research domains. At the end of the term, the students will be able to formulate decision making problems that have multiple decisions in time, uncertain events, and conflicting objectives. We will also discuss certain behavioral issues related to decision making.

LEARNING OUTCOMES

  • Describe the objectives, alternatives and uncertainties in a decision problem
  • Model and solve decision problems using decision trees.
  • Conduct sensitivity analysis to understand the important variables in the decision problem.
  • Explain the concepts of strategy, risk profiles and dominance.
  • Apply Bayes' formula, and calculate the values of perfect and imperfect information.
  • Assess discrete and continuous probability distributions using subjective methods, approximate methods, as well as theoretical models.
  • Apply single and multi-attribute utility models.
  • Implement the Analytical Hierarchy Process (AHP).
  • Describe the fundamental decision heuristics and related biases.
  • Discuss the fundamental concepts and trade-offs in decision analysis.

PROGRAMME OUTCOMES

1. Understand the world, their country, their society, as well as themselves and have awareness of ethical problems, social rights, values and responsibility to the self and to others. 4

2. Understand different disciplines from natural and social sciences to mathematics and art, and develop interdisciplinary approaches in thinking and practice. 4

3. Think critically, follow innovations and developments in science and technology, demonstrate personal and organizational entrepreneurship and engage in life-long learning in various subjects; have the ability to continue to educate him/herself. 3

4. Communicate effectively in Turkish and English by oral, written, graphical and technological means. 3

5. Take individual and team responsibility, function effectively and respectively as an individual and a member or a leader of a team; and have the skills to work effectively in multi-disciplinary teams. 3

1. Possess sufficient knowledge of mathematics, science, fundamental engineering, computational methods and program-specific engineering topics; use theoretical and applied knowledge of these areas in complex engineering problems. 3

2. Identify, define, formulate and solve complex engineering problems while considering the UN Sustainable Development Goals; choose and apply suitable analysis, design, estimation/prediction and modeling methods for this purpose. 4

3. Develop, choose and use modern techniques and tools that are needed for analysis and solution of complex problems faced in engineering applications; use information technologies effectively. 4

4. Have the ability to design a complex system, process, instrument or a product under realistic constraints and conditions, with the goal of fulfilling creative current and future requirements. 3

5. Use research methods, including conducting literature reviews, designing experiments, performing experiments, collecting data, analyzing results, and interpreting results, to investigate complex engineering problems or discipline-specific research topics. 3

6. Possess knowledge of business practices such as project management, risk management, change management, and economic feasibility analysis; awareness on entrepreneurship and innovation. 4

7. Possess knowledge of impact of engineering solutions on society, health and safety, the economy, sustainability, and the environment within the framework of the UN Sustainable Development Goals; awareness on legal outcomes of engineering solutions; awareness of acting impartially and inclusively without any form of discrimination; act in accordance with ethical principles, possessing knowledge of professional and ethical responsibilities. 4

8. Communicate effectively, both orally and in writing, on technical subjects, considering the diverse characteristics of the target audience (such as education, language, and profession). 3

1. Develop knowledge of theories, concepts, and research methods in humanities and social sciences. 3

2. Assess how global, national and regional developments affect society. 1

3. Know how to access and evaluate data from various sources of information. 3

1. Have an understanding of economics and main functional areas of management

2. Have a basic all-around knowledge in humanities, science, mathematics, and literature

3. Have a basic knowledge of law and ethics, awareness of social and ethical responsibilities

4. Work effectively in teams and environments characterized by people of diverse educational, social and cultural backgrounds

5. Demonstrate proficiency in oral and written communications in English

6. Pursue open minded inquiry and appreciate the importance of research as an input into management practice; thus, a.know how to access, interpret and analyze data and information by using current technologies b.use the results from analyses to make informed decisions

7. Use office softwares for written communication, presentation, and data analysis

8. Demonstrate awareness that business settings present different opportunities and challenges for managers due to environmental/contextual differences that arise in economic, political, cultural, legal-regulatory domains

ASSESSMENT METHODS and CRITERIA

  Percentage (%)
Final 50
Midterm 50

RECOMENDED or REQUIRED READINGS

Textbook

Making Hard Decisions with Decision Tools, 2nd Edition by Robert T. Clemen, Duxbury, 2003