Decision modeling is an exceptionally useful service for any company that engages in planningthat is, any company large or small, regardless of industry. Essentially, decision modeling involves assimilating data and using statistical models and decision logic to estimate or predict future outcome. For example, decision modeling can be used to
- predict the number of scored points per game by an NBA player from the player's height, number of games played, number of minutes in game, and age.
- determine which specific managerial activities relate to organizational effectiveness.
- determine how income, age, and level of education affects the probability that a person will buy a computer within one year.
Decision modeling can be utilized in any of the following areas to answer specific questions such as the examples listed below.
Safety: How do specific factors such as level of training, equipment placement, and supervision affect workplace safety?
Productivity: What is the productivity level of my workforce? What effect will certain practices/policies have on productivity?
ROI: What will the return on investment be for this specific venture? What conditions affect the outcome?
Sales: How will regional economic conditions affect the sale of certain product lines?
Marketing: Which marketing tools are most effective with customers of a certain age and income level?
Benchmarking: How does our performance compare with that of our top competitors?
Profiling: Who are my customers?
Forecasting: What will my profit, sales, and growth be next year?
Process Improvement: How can I reduce the level of scrap material while improving on-time delivery?
Statistical Process Control: To what extent will effective use of SPC reduce my level of customer returns?
If you wonder whether decision modeling could be of use in making a specific decision or simply want more information on how decision modeling can benefit your company, email us at email@example.com.