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Notes on software and processes for collecting, analyzing and acting on data |
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Probabilty of Future Events: This site is about tools that are useful under conditions of uncertainty. Uncertainty is a state of not knowing well (more . . .) Decision Trees: The mechanics of creating a decision tree are pretty straightforward. You start with a decision at the tree's root. If (more . . .) Related:
Essays: This is my how-to site. The essays are notes about the experience of becoming familiar with the tools of my (more . . .)
Complex Systems and Emergent Behavior: Most simply, a system is a collection of parts or pieces that interact, affecting each other over time. Each piece (more . . .) About this siteSyndication available
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To start, I recommend two books which were my start, Making Hard Decisions by Clemens and Thinking and Deciding by Baron. Both are very readable college/graduate level textbooks that will take you through the field. After that, the kind of problems you face will dictate what kind of tools you need. I think every should know how to draw decision tree and calculate the value of it's branches. In a decision tree, you lay out the alternative choices, put in the events that are out of your control, with the probabilities of various outcomes and then calculate the average value of each choice. Here's a link to a Decision Modeling add in for Excel that is inexpensive and does an OK job. The next level is modeling and simulation. In the pharmaceutical industry we have models of drug action called PK / PD models (Pharmacokinetic / Pharmacodynamic models) which are created by a team with specialized tools. The simulation is then a Clinical Trial Simulation. But anyone who's work and life can be captured in a spreadsheet is already creating models. The "what if" capability of a spreadsheet captures the essence of a predictive model. Spreadsheet models can be turned into simulations with an Excel add-in called Crystal Ball developed by Decisioneering. |
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Copyright 2003 by James J. Vornov |