Tag: assessment

Decision-makers from the household to state level frequently have to make decisions within a context of risks, uncertainties, multiple possible outcomes and stakeholder groups with varied interests. It is therefore reasonable for them to be concerned about the risk that an investment or intervention could fail to achieve its objectives. This happens because the uncertainties surrounding the impacts of a proposed development intervention during project assessment are usually not addressed. These uncertainties can be high where information on the parameters of interest and how they will evolve under future change is scarce. For instance, there is a severe lack of data on the ecological, socioeconomic, cultural and political parameters that would influence the complex dynamics of environmental systems.Decision analysis aims to assist decision-makers in making rational decisions in situations where they are faced with imperfect information. It is concerned with identifying the most promising course of action, while recognizing risks and uncertainties. Initially, analyses are based on the current state of knowledge about particular variables of interest, before any measurements are taken. This knowledge is used for probabilistic simulations of the full range of plausible system outcomes of particular interventions, which aid in prioritizing decision options based on their likely outcomes or impacts. This is achieved by including decision-makers, various stakeholders and end-users in conducting ex-ante impact assessments using quantitative impact pathways and probabilistic estimates of all relevant benefits, costs, risks and uncertain variables. Business decision analysis methods offer a promising way forward, because they have been designed for aiding businesses in making decisions on risky projects with limited research budgets. To achieve this, a key objective of decision analysis is capturing the current state of uncertainty.