The analytical family would be chosen after the decision is formulated

In the Analytical Transition examples, optimization appears in 5 of the 6 functions. That assignment is our own proposal.

To choose among alternatives, the decision-maker would first have to write down what is maximized or minimized and which constraints apply. The analytical family would be deduced from that problem.

In Capital Allocation, finite capital would be distributed among alternatives. In Capital Projects, the configuration of a physical system would be decided. Optimization could be used in both, with different objectives and constraints.

When a Capital Allocation Decision System is formulated, the methods suited to solving that decision would be chosen. Technology would come after the conversation about the problem.

What objective and what constraints would you write down before approving the analytical tool for your next investment?

Sources

The full Perspective, with its sources, is available on request.