Skip to main content
SpringerLink
Log in
Book cover

Handbook of Multicriteria Analysis pp 25–48Cite as

Multi-Criteria Decision Analysis for Strategic Decision Making

  • Chapter
  • First Online:

Part of the book series: Applied Optimization ((APOP,volume 103))

Abstract

In this chapter we discuss the use of MCDA for supporting strategic decision making, particularly within strategy workshops. The chapter begins by exploring the nature of strategic decisions and the characteristics of the strategic decision making process. Specifically, we examine the technical issues associated with the content of strategic decisions, and the social aspects that characterise the processes within which they are created. These features lead us to propose a number of adaptations to the standard MCDA approach if it were to be used at a more strategic level. We make suggestions on how to implement these proposals, and illustrate them with examples drawn from real-world interventions in which we have participate das strategic decision support analysts.

This is a preview of subscription content, log in via an institution.

Chapter
USD   29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD   149.00
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD   199.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD   199.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Learn about institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. F. Ackermann. The role of computers in group decision support. In C. Eden and J. Radford, editors, Tackling Strategic Problems: The Role of Group Decision Support, pages 132–141. Sage, London, 1990.

    Google Scholar 

  2. F. Ackermann. Participant’s perceptions on the role of facilitators using group decision support systems. Group Decision and Negotiation, 5:93–112, 1996.

    Google Scholar 

  3. F. Ackermann and C. Eden. Issues in computer and non-computer supported GDSSs. Decision Support Systems, 12(4-5):381–390, 1994.

    Article  Google Scholar 

  4. H. Aissi and B. Roy. Robustesse en aide multicrit`ere `a la decision. Cahier du Lamsade, No. 276, 2008.

    Google Scholar 

  5. C.A. Bana e Costa, L. Ensslin, E.C. Corrˆea, and J.C. Vansnick. DSS in action: Integrated application in a multi-criteria decision aid process. European Journal of Operational Research, 113:315–335, 1999.

    Google Scholar 

  6. A. Barcus and G. Montibeller. Supporting the allocation of software development work in distributed teams with multi-criteria decision analysis. Omega, 36:464–475, 2008.

    Article  Google Scholar 

  7. V. Belton, F. Ackermann, and I. Shepherd. Integrated support from problem structuring through to alternative evaluation using COPE and VISA. Journal of Multi-Criteria Decision Analysis, 6:115–130, 1997.

    Article  Google Scholar 

  8. S. Benartzi and R.H. Thaler. Risk aversion or myopia? Choices in repeated gambles and retirement investments. Management Science, 45(3):364–381, 1999.

    Google Scholar 

  9. P.L. Berger and T. Luckmann. The Social Construction of Reality: A Treause in the Sociology of Knowledge. Penguin, Harmondsworth, 1967.

    Google Scholar 

  10. S.D. Bond, K.A. Carlson, and R.L. Keeney. Generating objectives: Can decision makers articulate what they want? Management Science, 54(1):56–70, 2008.

    Article  Google Scholar 

  11. R.T. Clemen and T. Reilly. Making Hard Decisions. Pacific Grove, Duxbury, 2001.

    Google Scholar 

  12. J. Conklin. Dialogue Mapping: Building Shared Understanding of Wicked Problems. Wiley, Chichester, 2006.

    Google Scholar 

  13. A.P. de Geus. Planning as learning. Harvard Business Review, 6(2):70–74, 1988.

    Google Scholar 

  14. I. Durbach and T.J. Stewart. Integrating scenario planning and goal programming. Journal of Multi-Criteria Decision Analysis, 12(4-5):261–271, 2003.

    Google Scholar 

  15. C. Eden. The unfolding nature of group decision support: Two dimensions of skill. In C. Eden and J. Radford, editors, Tackling Strategic Problems: The Role of Group Decision Support, pages 48–52. Sage, London, 1990.

    Google Scholar 

  16. C. Eden. Strategy development as a social process. Journal of Management Studies, 29(6):799–811, 1992.

    Article  Google Scholar 

  17. C. Eden and F. Ackermann. Strategy Making: The Journey of Strategic Planning. Sage, London, 1998.

    Google Scholar 

  18. K.M. Eisenhardt and M.J. Zbaracki. Strategic decision making. Strategic Management Journal, 13:17–37, 1992.

    Google Scholar 

  19. L. Ensslin, G. Montibeller, and M.V.A. Lima. Constructing and implementing a DSS to help evaluate perceived risk of accounts receivable. In Y.Y. Haimes and R.E. Steuer, editors, Research and Practice in Multiple Criteria Decision Making, pages 248–259. Springer, Berlin, 2000.

    Google Scholar 

  20. M. Fine. New voices in the workplace: Research directions in multicultural communication. Journal of Business Communication, 28:259–275, 1991.

    Article  Google Scholar 

  21. A. Franco and G. Montibeller. Facilitated modelling in operational research. European Journal of Operational Research, 2009. Forthcoming.

    Google Scholar 

  22. L.A. Franco. Forms of conversation and problem structuring methods: A conceptual development. Journal of the Operational Research Society, 57(7):813–821, 2006.

    Article  Google Scholar 

  23. S. French, T. Bedford, and E. Atherton. Supporting ALAEP decision maing lby cost benefit analysis and multi-attribute utility theory. Journal of Risk Research, 8(3):207–223, 2005.

    Article  Google Scholar 

  24. J. Friend and A. Hickling. Planning under Pressure: The Strategic Choice Approach. Elsevier, Oxford, 3rd edition, 2005.

    Google Scholar 

  25. P. Goodwin and G. Wright. Enhancing strategy evaluation in scenario planning: A role for decision analysis. Journal of Management Studies, 38:1–16, 2001.

    Article  Google Scholar 

  26. R. Gregory and R.L. Keeney. Creating policy alternatives using stakeholder values. Management Science, 40(8):1035–1048, 1994.

    Article  Google Scholar 

  27. J. Hendry. Strategic decision making discourse, and strategy as social practice. Journal of Management Studies, 37(7):955–978, 2000.

    Google Scholar 

  28. R. Hites, Y. De Smet, Y.N. Risse, M. Salazar-Neumann, and P. Vincke. About the applicability of MCDA to some robustness problems. European Journal of Operational Research, 174(1):322–332, 2006.

    Article  Google Scholar 

  29. G.P. Hodgkinson, R. Whittington, G. Johnson, and M. Schwarz. The role of strategy workshops in strategy development processes: Formality, communication, co-ordination and inclusion. Long Range Planning, 39(5):479–496, 2006.

    Article  Google Scholar 

  30. F.O. Hoffman and Hammonds J.S. Propagation of uncertainty in risk assessments: The need Risk Analysis, 14(5):707–712, 1994.

    Google Scholar 

  31. R.A. Howard. Decision analysis: Practice and promise. Management Science, 34(6):679–95, 1988.

    Google Scholar 

  32. M. Huspek and K. Kendall. On withholding political voice: An analysis of the political vocabulary of a “non-political” speech community. Quarterly Journal of Speech, 77:1–19, 1991.

    Article  Google Scholar 

  33. W. Isaacs. Dialogue and the Art of Thinking Together. Currency, New York, 1999.

    Google Scholar 

  34. I.L. Janis. Groupthink: Psychological Studies of Policy Decisions and Fiascos. Houghton Mifflin Company, Boston, MA, 2nd edition, 1982.

    Google Scholar 

  35. P. Jarzabkowski, J. Balogun, and D. Seidl. Strategizing: The challenges of a practice perspective. Human Relations, 60:5–27, 2007.

    Article  Google Scholar 

  36. G. Johnson, K. Scholes, and R. Whittington. Exploring Corporate Strategy: Text and Cases. Prentice Hall, London, 7th edition, 2005.

    Google Scholar 

  37. D. Kahneman, P. Slovic, and A. Tversky. Judgment under Uncertainty: Heuristics and Biases. Cambridge University Press, Cambridge, 1982.

    Google Scholar 

  38. S. Kaner. Facilitator’s Guide to Participatory Decision Making. Jossey Bass, San Francisco, CA, 2007.

    Google Scholar 

  39. R.L. Keeney. Value-Focused Thinking: A Path to Creative Decision-making. Harvard University Press, Cambridge, 1992.

    Google Scholar 

  40. R.L. Keeney and H. Raiffa. Decisions with Multiple Objectives: Preferences and Value Tradeoffs. Cambridge University Press, Cambridge, 2nd edition, 1993.

    Google Scholar 

  41. H. Laroche. From decision to action in organizations: A social representation perspective. Organization Science, 6:62–75, 1995.

    Google Scholar 

  42. R.J. Lempert and M.T. Collins. Managing the risk of uncertain threshold responses: Comparison of robust, optimum, and precautionary approaches. Risk Analysis, 27(4):1009–1026, 2007.

    Article  Google Scholar 

  43. R.J. Lempert, D.G. Groves, S.W. Popper, and S.C. Bankes. A general, analytic method for generating robust strategies and narrative scenarios. Management Science, 52:514–528, 2006.

    Article  Google Scholar 

  44. R.J. Lempert, S.W. Popper, and S.C. Bankes. Shaping the Next One Hundred Years: New Methods for Quantitative, Long-Term Policy Analysis. RAND, Santa Monica, 2003.

    Google Scholar 

  45. L.L. Lopes. When time is of the essence: Averaging, aspiration, and the short run. Organizational Behavior and Human Decision Processes, 65(3):179–189, 1996.

    Article  Google Scholar 

  46. R.D. Luce. Commentary on aspects of Lola Lopes’ paper. Organizational Behavior and Human Decision Processes, 65(3):190–193, 1996.

    Article  Google Scholar 

  47. H. Mintzberg. 5 Ps for strategy. California Management Review, 30(1):11–24, 1987.

    Google Scholar 

  48. H. Mintzberg, D. Raisinghani, and A. Th´eorˆet. The structure of “unstructured” decision processes. Administrative Science Quarterly, 21(2):246–275, 1976.

    Google Scholar 

  49. H. Mintzberg and J.A. Waters. Does decision get in the way? Organization Studies, 111:1–6, 1990.

    Google Scholar 

  50. G. Montibeller and V. Belton. Causal maps and the evaluation of decision options - A review. Journal of the Operational Research Society, 57(7):779–771, 2006.

    Article  Google Scholar 

  51. G. Montibeller, L.A. Franco, E. Lord, and A. Iglesias. Structuring resource allocation decisions: A framework for building multi-criteria portfolio models with area-grouped options. European Journal of Operational Research, 199(3):846–856, 2009.

    Article  Google Scholar 

  52. G. Montibeller, H. Gummer, and D. Tumidei. Combining scenario planning and multi-criteria decision analysis in practice. Journal of Multi-Criteria Decision Analysis, 14:5–20, 2006.

    Article  Google Scholar 

  53. L.P. Neves, L.C. Dias, C.H. Antunes, and A.G. Martins. Structuring an MCDA model using SSM: A case study in energy efficiency. European Journal of Operational Research, 199(3):834–845, 2009.

    Article  Google Scholar 

  54. G.S. Parnell, H.W. Conley, J.A. Jackson, L.J. Lehmkuhl, and J.M. Andrew. Foundations 2025: A value model for evaluating future air and space forces. Management Science, 44(10):1336–1350, 1998.

    Article  Google Scholar 

  55. L. Phillips. A theory of requisite decision models. Acta Psychologica, 56(1-3):29–48, 1984.

    Article  Google Scholar 

  56. L. Phillips. People-centred group decision support. In G. Doukidis, F. Land, and G. Miller, editors, Knowledge-based Management Support Systems, pages 208–224. Ellis-Horwood, Chichester, 1989.

    Google Scholar 

  57. L.D. Phillips,, and M. Phillips. Facilitated work groups: Theory and practice. Journal of Operational Research Society, 44(6):533–549, 1993.

    Google Scholar 

  58. L.D. Phillips. Decision analysis and its application in the industry. In G. Mitra, editor, Computer Assisted Decision Making, pages 189–197. Elsevier, North-Holland, 1986.

    Google Scholar 

  59. L.D. Phillips. Decision conferencing. In W. Edwards, R.F. Miles Jr., and D. von Winterfeldt, editors, Advances in Decision Analysis: From Foundations to Applications, pages 375–399. Cambridge University Press, New York, 2007.

    Google Scholar 

  60. L.D. Phillips and C.A. Bana e Costa. Transparent prioritisation, budgeting, and resource allocation with multi-criteria decision analysis and decision conferencing. Annals of Operations Research, 154:51–68, 2007.

    Google Scholar 

  61. C. Ram, G. Montibeller, and A. Morton. Extending the use of scenario planning and MCDA: An application to food security in Trinidad & Tobago. Working Paper LSEOR 09.105, London School of Economics (http://www.lse.ac.uk/collections/operationalResearch/pdf/WP105 - Camelia Ram.pdf), 2009.

    Google Scholar 

  62. N.C. Roberts. Transformative Power of Dialogue. Elsevier, London, 2002.

    Google Scholar 

  63. J. Rosenhead. Robustness analysis: Keeping your options open. In J. Rosenhead and J. Mingers, editors, Rational Analysis for a Problematic World Revisited: Problem Structuring Methods for Complexity, Uncertainty and Conflict, pages 181–209. Wiley, Chichester, 2001.

    Google Scholar 

  64. J. Rosenhead, M. Elton, and S.K. Gupta. Robustness and optimality as criteria for strategic decisions. Operational Research Quarterly, 23(4):413–431, 1972.

    Article  Google Scholar 

  65. J. Rosenhead and J. Mingers. Rational Analysis for a Problematic World Revisited: Problem Structuring Methods for Complexity, Uncertainty and Conflict. Wiley, Chichester, 2001.

    Google Scholar 

  66. B. Roy. Multicriteria Methodology for Decision Aiding. Kluwer, Dordrecht, 1996.

    Google Scholar 

  67. B. Roy. A missing link in or-da: Robustness analysis. Foundations of Computing and Decision Sciences, 23(3):141–160, 1998.

    Google Scholar 

  68. S. Santos, V. Belton, and S. Howick. Adding value to performance measurement by using system dynamics and multicriteria analysis. International Journal of Operations and Production Management, 22(11):1246–1272, 2002.

    Article  Google Scholar 

  69. M.S. Schilling, N. Oeser, and C. Schaub. How effective are decision analyses? Assessing decision process and group alignment effects. Decision Analysis, 4(4):227–242, 2007.

    Google Scholar 

  70. P.J.H. Schoemaker. When and how to use scenario planning: A heuristic approach with illustration. Journal of Forecasting, 10(6):549–564, 1991.

    Article  Google Scholar 

  71. P.J.H. Schoemaker. Multiple scenario development: Its conceptual and behavioral foundation. Strategic Management Journal, 14(3):193–213, 1993.

    Article  Google Scholar 

  72. P.J.H. Schoemaker. Scenario planning: A tool for strategic thinking. Sloan Management Review, 36(2):25–40, 1995.

    Google Scholar 

  73. S. Schuman. The IAF Handbook of Group Facilitation: Best Practices from the Leading Organization in Facilitation. Jossey Bass, San Francisco, CA, 2005.

    Google Scholar 

  74. R. Schwarz. The Skilled Facilitator: A Comprehensive Resource for Consultants, Facilitators, Managers, Trainers, and Coaches. Jossey Bass, San Francisco, CA, 2002.

    Google Scholar 

  75. C.R. Schwenk. Strategic decision making. Journal of Management Studies, 21(3):471–493, 1995.

    Google Scholar 

  76. W.H. Starbuck. Organizations as action generators. American Sociological Review, 48:91–102, 1983.

    Article  Google Scholar 

  77. W.H. Starbuck. Acting first and thinking later: Theory versus reality in strategic change. In J.M. Pennings, editor, Organizational Strategy and Change, pages 132–141. Jossey Bass, San Francisco, 1985.

    Google Scholar 

  78. T.J. Stewart. Scenario analysis and multicriteria decision making. In J. Climaco, editor, Multicriteria Analysis, pages 519–528. Springer, Berlin, 1997.

    Google Scholar 

  79. T.J. Stewart. Dealing with uncertainties inMCDA. In J. Figueira, S. Greco, and M. Ehrgott, editors, Multiple Criteria Decision Analysis - State of the Art Surveys, pages 445–470. Springer, New York, 2005.

    Google Scholar 

  80. T.J. Stewart and A.R. Joubert. Multicriteria support for decision-making in the ecosystems approach to fisheries management. BCLME Programme (http://www.bclme.org/projects/docs/EAF/Appendix8a Stewart and Joubert isa.pdf), 2006.

    Google Scholar 

  81. Belton V. and Stewart T. Multiple Criteria Decision Analysis: An Integrated Approach. Kluwer, Dordrecht, 2002.

    Google Scholar 

  82. K. van der Heijden. Scenarios: The Art of Strategic Conversation. Wiley, Chichester, 2nd edition, 2004.

    Google Scholar 

  83. D. Vaughan. The Challenger Launch Decision: Risk Technology, Culture and Deviance at NASA. University of Chicago Press, Chicago, IL, 1996.

    Google Scholar 

  84. P. Vincke. Robust solutions and methods in decision-aid. Journal of Multi-Criteria Decision Analysis, 8:181–187, 1999.

    Article  Google Scholar 

  85. J. Wallenius, J.S. Dyer, P.C. Fishburn, R.E. Steuer, S. Zionts, and K. Deb. Multiple criteria decision making, multiattribute utility theory: Recent accomplishments and what lies ahead. Management Science, 54(7):1336–1349, 2008.

    Article  Google Scholar 

  86. S.R. Watson and D.M. Buede. Decision Synthesis. Cambridge University Press, Cambridge, 1987.

    Google Scholar 

  87. K.E. Weick. Sense Making in Organizations. Sage, Thousand Oaks, CA, 1995.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Management, London School of Economics, Houghton Street, London, WC2A 2AE, UK

    Gilberto Montibeller

  2. Warwick Business School, University of Warwick, Coventry, CV4 7AL, UK

    Alberto Franco

Authors
  1. Gilberto Montibeller
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Alberto Franco
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Gilberto Montibeller .

Editor information

Editors and Affiliations

  1. Dept. Production Engineering, and Management, Technical University of Crete, University Campus, Chania, 731 00, Greece

    Constantin Zopounidis

  2. Dept. Industrial & Systems, Engineering, University of Florida, Weil Hall 303, Gainesville, 32611-6595, USA

    Panos M. Pardalos

Rights and permissions

Reprints and permissions

Copyright information

© 2010 Springer-Verlag Berlin Heidelberg

About this chapter

Cite this chapter

Montibeller, G., Franco, A. (2010). Multi-Criteria Decision Analysis for Strategic Decision Making. In: Zopounidis, C., Pardalos, P. (eds) Handbook of Multicriteria Analysis. Applied Optimization, vol 103. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-92828-7_2

Download citation

Publish with us

Policies and ethics

Search

Navigation