August 1998 Decision Analysis Software Survey: Aiding Insight IV By Dennis Buede This is the fourth survey of decision analysis software published by OR/MS Today since April 1993. There are three more packages since August 1996 (the last survey); eight of the 32 packages in this survey are new. This is modest turnover, a little less than existed between the 1994 and 1996 surveys. Decision analysis is the discipline of evaluating complex alternatives in terms of values (what we care about) and uncertainty (what we know and do not know). Experienced decision analysts and educators stress that the benefits of decision analysis are insight into how the defined alternatives differ from one another and suggestions for generating new and improved alternatives. Too many critics stress the use of numbers to quantify subjective values and uncertainties without realizing the power of quantitative analysis for generating qualitative insight. In order to create a decision analysis model it is necessary to create the model structure and elicit the probabilities and values to populate the model for computation. Trained analysts are still providing most of the structuring support although we continue to see advances in the software market for model structuring. Elicitation support involves queries about the values for probabilities, value functions for evaluating alternatives, value weights for measuring the tradeoffs among objectives, and risk preference. Once the structure and numbers are in place, the analysis can begin. Much more is involved than computing the expected, weighted utility of each alternative. If we stopped there, decision-makers would not receive much in the way of insight. We have to examine the sensitivity of the expected, weighted utility to key probabilities, weights and risk preference parameters. As part of the sensitivity analysis we can calculate the value of perfect information for uncertainties that have been explicitly modeled. Additional quantitative comparisons include the direct comparison of weighted utility for two alternatives on all of the objectives and the comparison of all of the alternatives on any two selected objectives showing the Pareto optimality for these two objectives. In my experience, these last two comparisons have enabled substantial closure by the decision-makers on the preferred alternative. Survey Questions The questions that we sent to the software vendors are essentially the same as those from 1996. These questions are easy to answer and were mailed and faxed to known decision analysis software vendors and many other software vendors who might have introduced decision analysis packages. The staff at OR/MS Today collected the information for this survey from the vendors and formatted displays as shown. I want to stress that the information presented here represents the responses of the vendors and is the best and most comprehensive that we could assemble in a short period of time. However, the information is not sufficiently complete to suggest that you, the reader, could make an informed choice of which package to select. This is just not possible from the easy-to-answer (yes/no or multiple choice) questions that we used for this survey. We provided a space for the vendor to describe concisely the most important aspects of the software. Survey Results As noted, there are 32 entries in this survey; 24 repeats and eight new packages. The PC with Windows-based operating system is still the dominant platform for software in this limited market. The primary focus of the software vendors continues to be on analysis features rather than support for non-analysts in structuring the problem and a more complete set of elicitation support. These analysis features are useful to all users and critical for the insight that decision-makers need. However, the result is that there are relatively few of us that are qualified and comfortable in using these packages. These packages will never become as widespread as spreadsheet and database packages as long the user has to be a highly educated analyst. The sentiment expressed by an educator in 1996, concerning the lack of a software package that was sophisticated enough for a graduate-level course on decision analysis but easy enough to learn and use that it could fit into a semester-level course, is still valid. The fastest growing segment of this software market in 1996 was group decision support. This segment has stayed stable or shrunk, with a new emphasis on Web-based decision support. Web-HIPRE and Mesa/Vista are examples of software available for use on the Web. Software that was oriented toward probabilistic inference in 1996 has been expanded to include decision analysis support as well; Hugin and NETICA are examples of this market segment. There continues to be an emphasis on providing decision analysis as part of spreadsheet software. This segment demands the presence of a trained analyst, commands a substantially larger upfront and recurring monetary investment, and a substantial investment of the time of high level members of the organization. The "glitz" of this market segment is high right now; time will tell about the return on investment as perceived by decision-makers. There continues to be substantial room for improvement in these packages in terms of providing support during the problem definition and model structuring phases of analysis. Yet the current set of packages afford the analyst with plenty of choices for selecting a very powerful decision analysis tool. Go to the accompanying survey Dennis Buede is an associate professor of Systems Engineering and Operations Research at the School of Information Technology and Engineering, George Mason University. He can be reached via e-mail at: buede@gmu.edu Table of Contents OR/MS Today Home Page OR/MS Today copyright © 1998 by the Institute for Operations Research and the Management Sciences. All rights reserved. Lionheart Publishing, Inc. 506 Roswell Street, Suite 220, Marietta, GA 30060, USA Phone: 770-431-0867 | Fax: 770-432-6969 E-mail: lpi@lionhrtpub.com URL: http://www.lionhrtpub.com Web Site © Copyright 1998 by Lionheart Publishing, Inc. All rights reserved.