Decision Tree

Decision Tree

1. Advantages

   • They set out problems clearly and encourage a logcal approcah to decision making
   • They encourage careful consideration of all alternatives
   • The encourage a quanitative approach that may improve the results and also means that the process can be computerized
   • They are useful when making tactical or routine decisions rather than strategic decisions

2. Disadvantages

   • They ignore the constantly chaning nature of the business enviroment.
   • It is difficult to get accurate and realistic data in order to estimate probabilities
   • They are less useful in relation to completely new decisions or problems and one-off strategic decisions or problems
   • They may lead to managers taking less account of important qualitative issues.