Sustainability Project: Risk Analysis Based on Decision Trees Under Conditions of Total and Partial Ignorance
Volume 5, Issue 3 (2016), pp. 391–402
Pub. online: 31 March 2016 Type: Article Open Access
31 March 2016
31 March 2016
Sustainability project is an important part of project management and depends on many factors, such as financial resources, human resources, scheduling operations and especially potential risks. This paper presents a way to work with uncertain information processing project risk analysis with regard to its sustainability. Risk management is an important part of various disciplines, e.g. Project management, Crisis management, Change management, Information Security Management System, etc. Risk analysis is mostly based on expert estimates. However, this may be a problem with brand new tasks as identification of different threats and their numerical evaluations can be interpreted as a decision-making task which can be formalised as a decision tree. A decision-making task solution requires knowledge of all relevant input information items (III), such as probabilities, penalties and profits. If all those numerical values are known then the well-known methods of decision trees evaluations can be used. However, if complex project management problems are solved then a substantial set of relevant data items is missing or its accuracies are prohibitively low. The aim of this paper is to present easy approach how missing elements of the III set can be obtained and integrated into incomplete data sets. The paper contributes a common sense heuristics to obtain missing elements of the III set which can generate all numerical values, i.e. a problem under complete ignorance is solve, and a reconciliation mechanism based on linear programming which allows results of common sense heuristics simply integrate into incomplete data set, i.e. a problem under partial ignorance is solved. The results are therefore divided into two parts. In the first part solves a problem under total ignorance. The second part of the case study evaluates some unknown probabilities, therefore solves a problem under partial ignorance. Both tasks, i.e. partial and total ignorance are demonstrated using a quasi-realistic decision tree. The decision tree has one root node, 6 lotteries and 15 terminals; the total number of unknown probabilities is 21 under total ignorance and 18 probabilities are evaluated under partial ignorance.