DESTINE TREE

Destine Tree

Destine Tree

Decision Tree

The decision tree formulated from the analysis of the scenario is prescribed below. The decision tree is formulated on the bases of three decisions or alternative available to the CEO in order to cope with the concern currently acknowledged by the organization. The alternatives available to CEO refer to the working condition of Kiln on the basis of which appropriate decisions are to be taken in order to minimize the cost and maximize the profit. The decision tree is based on the information provided by Pyrotech. The information prescribed by Pyrotech refers to the data acquired from analysis of previous case scenarios involving working condition of Kiln.

The data prescribes the accuracy of a particular alternative available to the organization along with the room of error associated with the decision. It has been suggested that the data prescribed by Pyrotech must be considered as a forecast report that can assist the formulation of prototype decision tree in order to facilitate the process of decision making. There are three alternate decisions that are available to the organization. Nevertheless, there is certain amount of cost associated with each decision except in the scenario where Kiln performs normally. If the Kiln produces varied quality then the encountered cost is €1.2 million; moreover, the cost associated with poor condition of Kiln and shut down is €2.4 million.

Decision Tree Drawing

CEO Requirements

Kiln is in critical condition or will produce varied quality output

According to the report presented by Pyrotech, the current analysis can serve as a prototype that can be used in the decision making process. While analyzing the report presented by Pyrotech, it was observed that if the company suggests varied output from Kiln then the reliability on this information represents 60% of accuracy and 40% margin of error. Furthermore, if Pyrotech suggests that Kiln is giving poor performance then the reliability on this information is represented by 90% accuracy and 10% margin of error. In addition, compared to former decision the later incorporates less cost to be encountered.

Should Kiln be shut down if working properly?

No, Kiln must not be shut down if it is working properly as it would enhance the cost encountered by the organization. However, it can be stated that if Pyrotech's final report asserts that the Kiln is performing poorly then the organization must adapt that decision as this decision will cost less to the organization as compared to other alternative.

Can engineer's reports be ignored to make own decisions

The report presented by engineered can be considered as a model of the final report to be delivered by Pyrotech. It can be asserted that there are certain decision alternatives that accompany margin of error with the outcomes. The scenario in which the report suggested normal function of kiln, there was 90% accuracy of the decision. The scenario in which the report suggested varied output from kiln, there was 60% accuracy of the decision.

Furthermore, the scenario in which poor performance of kiln was suggested, the decision accompanied 90% ...