Application of Decision Trees to Product Design

Slides:

Advertisements

Similar presentations

Step 1 The six-column work sheet prepares you for the eight-column work sheet in Chapter 9 Step 1: Write in the heading Indicate the fiscal period.

Advertisements

Defines a structured approach for making a good decision under uncertainty Does not guarantee a good outcome Allows you to measure and control the inherent.

5 - 1© 2011 Pearson Education, Inc. publishing as Prentice Hall 5 5 Design of Goods and Services PowerPoint presentation to accompany Heizer and Render.

Operations Management

BOPR 5301 – Operations Management Safitri Siswono Design of Goods & Services (chapter 5) March 26, 2010.

12-1 Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Decision Analysis Chapter 12.

1 1 Slide © 2004 Thomson/South-Western Payoff Tables n The consequence resulting from a specific combination of a decision alternative and a state of nature.

Chapter 17 Decision Making 17.1 Payoff Table and Decision Tree 17.2 Criteria for Decision Making.

Decision Making Under Uncertainty and Under Risk

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8-1 Recording Adjusting Entries Accounting Period Cycle: When a company prepares a.

IES 303 Supplement A: Decision making Week 3 Nov 24, 2005 Objective:

Chapter 4 The effect of profit or loss on capital and the double entry system for expenses and revenues.

Introduction Decision trees Decision trees enable one to look at decisions: alternativesstates of nature with many alternatives and states of nature which.

POM - J. Galván 1 PRODUCTION AND OPERATIONS MANAGEMENT Ch. 6: Design of Goods and Services.

© 2008 Prentice Hall, Inc.5 – 1 Operations Management Chapter 5 – Design of Goods and Services PowerPoint presentation to accompany Heizer/Render Principles.

© 2008 Prentice Hall, Inc.5 – 1 Operations Management Chapter 5 – Design of Goods and Services Delivered by: Eng.Mosab I. Tabash Eng.Mosab I. Tabash.

Operations Management Design of Goods and Services Chapter 5

BU1004 Week 3 expected values and decision trees.

Decision Analysis. How to make a difficult decision?  Uncertainty regarding the future  Conflicting values or objectives  Goal of Decision Analysis:

P247. Figure 9-1 p248 Figure 9-2 p251 p251 Figure 9-3 p253.

Chapter 7 Income statements: an introduction

1 Section 9.2 Tree Applications. 2 Binary Search Trees Goal is implementation of an efficient searching algorithm Binary Search Tree: –binary tree in.

Decision Analysis A. A. Elimam College of Business San Francisco State University.

DECISION MAKING. What Decision Making Is?  Decision making is the process of identifying problems and opportunities, developing alternative solutions,

5 - 1© 2011 Pearson Education, Inc. publishing as Prentice Hall 5 5 Design of Goods and Services PowerPoint presentation to accompany Heizer and Render.

8-1 CHAPTER 8 Decision Analysis. 8-2 LEARNING OBJECTIVES 1.List the steps of the decision-making process and describe the different types of decision-making.

© PHI Learning, All rights reserved.1 Financial Accounting: A Managerial Perspective Third Edition Prepared by R. Narayanaswamy Indian Institute.

Press Esc to exit programme at any time Profit & Loss Accounts The calculation of profit and loss is one of the most important objectives of accounting.

AAT Level 3 Recap on Debits and Credits and Introduction to Income Statement and Statement of Financial Position.

“ The one word that makes a good manager – decisiveness.”

5 - 1© 2011 Pearson Education, Inc. publishing as Prentice Hall 5 5 Design of Goods and Services PowerPoint presentation to accompany Heizer and Render.

5 - 1© 2011 Pearson Education, Inc. publishing as Prentice Hall 5 5 Design of Goods and Services PowerPoint presentation to accompany Heizer and Render.

5 Product Design PowerPoint presentation to accompany

5 - 1© 2014 Pearson Education Product Design PowerPoint presentation to accompany Heizer and Render Operations Management, Global Edition, Eleventh Edition.

GOING SOLO UNIT 2C THE FINAL ACCOUNTS OF A SOLE TRADER.

The closing of the General Ledger

A – 1 Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall. Decision Making A For Operations Management, 9e by Krajewski/Ritzman/Malhotra.

Chapter 10 Uncertainty in Future Events

Decision Trees Dr. Ron Lembke Operations Management.

5 Design of Goods and Services Heizer and Render

Decision Analysis Defines a structured approach for making a good decision under uncertainty Does not guarantee a good outcome Allows you to measure and.

© 2011 Pearson Education 5 5 Product Design PowerPoint presentation to accompany Heizer and Render Operations Management, 10e, Global Edition Principles.

Closing Entries (Part 2). Closing Entry #2 - Expenses We want to clear the balance of each expense account. Expenses have debit balances, so we need CREDIT.

© 2008 Prentice Hall, Inc.A – 1 Decision-Making Environments  Decision making under uncertainty  Complete uncertainty as to which state of nature may.

Product Development. Product Selection and Development Stages Figure 5.4, pg. 138.

Decision Trees. Introduction Decision trees enable one to look at decisions: with many alternatives and states of nature which must be made in sequence.

Amity School Of Business Operations Research OPERATIONS RESEARCH.

Accounting Theory.  Matching expenses with revenue ◦ Recording revenue from business activities and expenses associated with earning that revenue in.

Accounting Concepts - Thomas Sanders. Accounting Period Cycle - Chapter 6 ● Changes in financial info are reported for a specific period of time in the.

BUAD306 Chapter 5S – Decision Theory. Why DM is Important The act of selecting a preferred course of action among alternatives A KEY responsibility of.

5 - 1© 2011 Pearson Education, Inc. publishing as Prentice Hall 5 5 Design of Goods and Services PowerPoint presentation to accompany Heizer and Render.

Decision Analysis.

VI-D-15(PP) Disassembly of the Small Engine Figure 1.

1© 2014 Pearson Education, Inc. Design of Goods and Services Reading Assignment Heizer and Render Operations Management, Eleventh Edition, Pearson, Chapter.

Situation David Chang is the owner of a small electronics company. In six months, a proposal is due for an electronic timing system for the 2016 Olympic.

A – 1 Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall. Decision Making A For Operations Management, 9e by Krajewski/Ritzman/Malhotra.

5 - 1© 2014 Pearson Education Product Design PowerPoint presentation to accompany Heizer and Render Operations Management, Global Edition, Eleventh Edition.

Financial Statements and Closing Procedures Section 2: Completing the Accounting Cycle Chapter 13 Section Objectives 4.Journalize and post the.

Decision-Trees 3.3 Decision-making techniques. What you need to know a) Construct and interpret simple decision tree diagrams b) Calculations and interpretations.

Design of Goods and Services

Design of Goods and Services

LSM733-PRODUCTION OPERATIONS MANAGEMENT

OPERATIONS RESEARCH.

Chapter 5S – Decision Theory

AMIS 310 Foundations of Accounting

Steps to Good Decisions

Decision Analysis Chapter 12.

Income Statement Farwell Company has the following information available from its most recent fiscal year. Use the relevant information to determine the.

Design of Goods and Services

Decision Analysis.

Presentation transcript:

Application of Decision Trees to Product Design Particularly useful when there are a series of decisions and outcomes which lead to other decisions and outcomes

Application of Decision Trees to Product Design Procedures Include all possible alternatives and states of nature - including “doing nothing” Enter payoffs at end of branch Determine the expected value of each branch and “prune” the tree to find the alternative with the best expected value

Hire and train engineers Decision Tree Example (.4) High sales Purchase CAD (.6) Low sales Hire and train engineers (.4) High sales (.6) Low sales Do nothing Figure 5.14

Hire and train engineers Decision Tree Example (.4) High sales $2,500,000 Revenue - 1,000,000 Mfg cost ($40 x 25,000) - 500,000 CAD cost $1,000,000 Net Purchase CAD (.6) Low sales $800,000 Revenue - 320,000 Mfg cost ($40 x 8,000) - 500,000 CAD cost - $20,000 Net loss (.6) Low sales (.4) High sales Hire and train engineers Do nothing EMV (purchase CAD system) = (.4)($1,000,000) + (.6)(- $20,000) Figure 5.14

Hire and train engineers Decision Tree Example (.4) High sales $2,500,000 Revenue - 1,000,000 Mfg cost ($40 x 25,000) - 500,000 CAD cost $1,000,000 Net Purchase CAD $388,000 (.6) Low sales $800,000 Revenue - 320,000 Mfg cost ($40 x 8,000) - 500,000 CAD cost - $20,000 Net loss (.6) Low sales (.4) High sales Hire and train engineers Do nothing EMV (purchase CAD system) = (.4)($1,000,000) + (.6)(- $20,000) = $388,000 Figure 5.14

Hire and train engineers Decision Tree Example (.4) High sales $2,500,000 Revenue - 1,000,000 Mfg cost ($40 x 25,000) - 500,000 CAD cost $1,000,000 Net Purchase CAD $388,000 (.6) Low sales $800,000 Revenue - 320,000 Mfg cost ($40 x 8,000) - 500,000 CAD cost - $20,000 Net loss Hire and train engineers $365,000 (.4) High sales $2,500,000 Revenue - 1,250,000 Mfg cost ($50 x 25,000) - 375,000 CAD cost $875,000 Net (.6) Low sales $800,000 Revenue - 400,000 Mfg cost ($50 x 8,000) - 375,000 CAD cost $25,000 Net Do nothing $0 $0 Net Figure 5.14

Transition to Production Know when to move to production Product development can be viewed as evolutionary and never complete Product must move from design to production in a timely manner Most products have a trial production period to insure producibility Responsibility must also transition as the product moves through its life cycle