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  • Book
  • © 2011

Portfolio Decision Analysis

Improved Methods for Resource Allocation

  • Cutting-edge research on portfolio decision analysis

  • Stellar group of contributors known throughout the field

  • Presents novel and established methods and theories

  • Includes supplementary material: sn.pub/extras

Part of the book series: International Series in Operations Research & Management Science (ISOR, volume 162)

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eBook USD 189.00
Price excludes VAT (USA)
  • ISBN: 978-1-4419-9943-6
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  • Readable on all devices
  • Own it forever
  • Exclusive offer for individuals only
  • Tax calculation will be finalised during checkout
Softcover Book USD 249.99
Price excludes VAT (USA)
Hardcover Book USD 249.99
Price excludes VAT (USA)

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Table of contents (15 chapters)

  1. Front Matter

    Pages i-xv
  2. Preliminaries

    1. Front Matter

      Pages 1-1
  3. PRELIMINARIES

    1. An Invitation to Portfolio Decision Analysis

      • Ahti Salo, Jeffrey Keisler, Alec Morton
      Pages 3-27
    2. Portfolio Decision Quality

      • Jeffrey Keisler
      Pages 29-51
    3. The Royal Navy’s Type 45 Story: A Case Study

      • Lawrence D. Phillips
      Pages 53-75
  4. Methodology

    1. Front Matter

      Pages 77-77
  5. METHODOLOGY

    1. Valuation of Risky Projects and Illiquid Investments Using Portfolio Selection Models

      • Janne Gustafsson, Bert De Reyck, Zeger Degraeve, Ahti Salo
      Pages 79-105
    2. Interactive Multicriteria Methods in Portfolio Decision Analysis

      • Nikolaos Argyris, José Rui Figueira, Alec Morton
      Pages 107-130
    3. Behavioural Issues in Portfolio Decision Analysis

      • Barbara Fasolo, Alec Morton, Detlof von Winterfeldt
      Pages 149-165
    4. A Framework for Innovation Management

      • Gonzalo Arévalo, David Ríos Insua
      Pages 167-185
    5. An Experimental Comparison of Two Interactive Visualization Methods for Multicriteria Portfolio Selection

      • Elmar Kiesling, Johannes Gettinger, Christian Stummer, Rudolf Vetschera
      Pages 187-209
  6. Applications

    1. Front Matter

      Pages 211-211
  7. APPLICATIONS

    1. An Application of Constrained Multicriteria Sorting to Student Selection

      • Julie Stal-Le Cardinal, Vincent Mousseau, Jun Zheng
      Pages 213-240
    2. Resource Allocation in Local Government with Facilitated Portfolio Decision Analysis

      • Gilberto Montibeller, L. Alberto Franco
      Pages 259-281
    3. Portfolio Decision Analysis: Lessons from Military Applications

      • Roger Chapman Burk, Gregory S. Parnell
      Pages 333-357
    4. Portfolio Decision Analysis for Population Health

      • Mara Airoldi, Alec Morton
      Pages 359-381
  8. Back Matter

    Pages 383-409

About this book

Winner of the 2013 Decision Analysis Publication Award

Portfolio Decision Analysis: Improved Methods for Resource Allocation provides an extensive, up-to-date coverage of decision analytic methods which help firms and public organizations allocate resources to 'lumpy' investment opportunities while explicitly recognizing relevant financial and non-financial evaluation criteria and the presence of alternative investment opportunities. In particular, it discusses the evolution of these methods, presents new methodological advances and illustrates their use across several application domains.

The book offers a many-faceted treatment of portfolio decision analysis (PDA). Among other things, it (i) synthesizes the state-of-play in PDA, (ii) describes novel methodologies, (iii) fosters the deployment of these methodologies, and (iv) contributes to the strengthening of research on PDA. Portfolio problems are widely regarded as the single most important application context of decision analysis, and, with its extensive and unique coverage of these problems, this book is a much-needed addition to the literature. The book also presents innovative treatments of new methodological approaches and their uses in applications.

The intended audience consists of practitioners and researchers who wish to gain a good understanding of portfolio decision analysis and insights into how PDA methods can be leveraged in different application contexts. The book can also be employed in courses at the post-graduate level.

"Resource allocation problems are ubiquitous in business and government organizations. Stated quite simply, we typically have more good ideas for projects and programs than funds, capacity, or time to pursue them. These projects and programs require significant initial investments in the present, with the anticipation of future benefits.   This necessitates balancing the promised return on investment against the risk that the benefits do not materialize. An added complication is that organizations often have complex and poorly articulated objectives and lack a consistent methodology for determining how well alternative investments measure up against those objectives.

I am pleased to see that [the editors] have succeeded in attracting a diverse collection of contributions from a distinguished set of authors. The editors do an excellent job of providing an overview of these contributions in their introductory chapter. I simply conclude by encouraging you to take up where these authors leave off, either by furthering the development of new theory and methods, or by putting these theories and methods to the test in real organizations struggling to make the best use of scarce resources."

Don N. Kleinmuntz, Strata Decision Technology, LLC

Keywords

  • Decision Analysis
  • Operations Research
  • Portfolio Decision Analysis
  • Resource Allocation

Reviews

From the reviews:

 

“This edited volume on portfolio decision analysis is a successful effort to capture many perspectives on an important problem in the industry … . The chapters form a diversified set of perspectives that can aid both academics and practitioners. … offers a variety of practitioner-based instances that make it useful reading for portfolio analysts. It also has some valuable information and future directions for academics who are interested in exploring the challenges of portfolio decisions.” (Stelios Kavadias, Interfaces, Vol. 44 (1), January-February, 2014)

Editors and Affiliations

  • , Systems Analysis Laboratory, Aalto University School of Science and T, Aalto, Finland

    Ahti Salo

  • Dept. Management Science &, Information Systems, University of Massachusetts, Boston, Boston, USA

    Jeffrey Keisler

  • , Department of Management, London School of Economics, London, Montserrat

    Alec Morton

About the editors

Ahti Salo is Professor of systems analysis at the Systems Analysis Laboratory of the Aalto University School of Science. He obtained his M.Sc. and Dr.Tech. degrees at the Helsinki University of Technology in 1987 and 1992, respectively. He has worked as a senior researcher at the Technical Research Centre of Finland (VTT) and Nokia Research Center, and as a visiting professor at the London Business School, Université Paris-Dauphine and the University of Vienna. His research interests include portfolio decision analysis, risk management, efficiency analysis, and technology foresight. He has written well over 100 publications, including papers in leading journals such as Management Science, Operations Research and European Journal of Operational Research, and is currently an Associate Editor of Decision Analysis. He has directed numerous high-impact decision support processes such as the national foresight project FinnSight 2015. In 2010, he became the President of the Finnish Operations Research Society, served on the jury of the EURO Doctoral Dissertation Award, and began his work as the European and Middle East Representative on the INFORMS International Activities Committee.

Jeffrey Keisler is Associate Professor of Management Science and Information Systems at the University of Massachusetts Boston.  He earned a Ph.D. in Decision Sciences and an S.M. in Engineering Sciences at Harvard as well as an MBA at the University of Chicago and a B.S. from the University of Wisconsin. He has over fifty assorted publications including articles in journals such as Decision Analysis, Interfaces, and Risk analysis. His research interests include decision analysis applications, portfolio decision analysis, decision processes, value of information, and other decision analytic methods.  He was previously a decision analyst at General Motors, Argonne National Laboratory and Strategic Decisions Group. He is Editor of Decision Analysis Today and an Associate Editor for Interfaces. He is President of the Specialty Group on Decision Analysis and Risk within the Society for Risk Analysis. Most recently, he became Vice-President/President-Elect of the INFORMS Decision Analysis Society.

Dr Alec Morton is Lecturer in Operational Research in the Department of Management at the London School of Economics and Political Science.  He teaches courses in decision analysis, simulation, and statistics, and his research interests are in the application of decision analysis to planning problems, especially in healthcare; in Multicriteria Decision Analysis and Multiobjective Optimization; in the normative foundations of health economics, and in games of attack and defence.  He is a graduate of the Universities of Manchester and Strathclyde, and before joining the LSE, worked at Singapore Airlines and the National University of Singapore.

Contributing Authors

Mara Airoldi, London School of Economics and Political Science
Gonzalo Arévalo, Carlos III National Health Institute
Nikolaos Argyris, London School of Economics and Political Science
Roger Chapman Burk, US Military Academy, West Point
Zeger Degraeve, London Business School
Bert De Reyck, University College London and London Business School,
Barbara Fasolo, London School of Economics and Political Science
José Rui Figueira, Universidade Técnica de Lisboa and Ecole des Mines de Nancy
L. Alberto Franco, Warwick Business School
Johannes Gettinger, Vienna University of Technology
Janne Gustafsson, Ilmarinen Mutual Pension Insurance Company
Elmar Kiesling, University of Vienna,
Jack Kloeber, Kromite, LLC
Juuso Liesiö, Aalto University School of Science
Gilberto Montibeller, London School of Economics and Political Science
Vincent Mousseau, Ecole Centrale Paris
Gregory S. Parnell, US Military Academy,West Point
Lawrence D. Phillips, London School of Economics and Political Science
David Ríos Insua, Royal Academy of Sciences
Julie Stal-Le Cardinal, Ecole Centrale Paris
Jeffrey S. Stonebraker, North Carolina State University
Christian Stummer, Universität Bielefeld
Antti Toppila, Aalto University School of Science
Rudolf Vetschera, University of Vienna
Detlof vonWinterfeldt, International Institute for Applied Systems Analysis
Jun Zheng, Ecole Centrale Paris

Bibliographic Information

Buying options

eBook USD 189.00
Price excludes VAT (USA)
  • ISBN: 978-1-4419-9943-6
  • Instant PDF download
  • Readable on all devices
  • Own it forever
  • Exclusive offer for individuals only
  • Tax calculation will be finalised during checkout
Softcover Book USD 249.99
Price excludes VAT (USA)
Hardcover Book USD 249.99
Price excludes VAT (USA)