Decision analysis
Differential Analysis Decisions Differential analysis decisions, referred to as alternative choices decisions, cover situations with two or more alternative courses of action from which the manager (decision maker) must select the best alternative. A decision involving more than two alternative is called a multiple-alternative choice decision. Some examples of alternative choice decisions are: make or buy, own or lease, retain or replace, repair or renovate, now or later, change versus status quo, slower or faster, export versus local sales, shut down or continue, expand or contract, change the product-mix, take or refuse orders, place special orders, select sale territories, replace present equipment with new machinery, sell at split-up point or process further, etc. 1. Make or Buy/Insourcing Vs Outsourcing Decisions: Make or buy decisions, also referred to as in-sourcing vs outsourcing decisions, arise when a company with unused production capacity considers the follow...