Decision Support Methods

Some knowledge of Mathematical Programming.

Teaching method is initially expository on the theoretical parts, and then proceeds with problem solving by students.

To present the potential of decision support methods for linear, nonlinear and stochastic cases in the context of monitoring, operational research and management, with particular emphasis on formulation and troubleshooting decisions within Engineering and Industrial Management, and also to introduce and work with the existent useful tools to obtain good solutions.

I-Deterministic models 1. Formulation and model development. Models based on linear programming. Sensitivity analysis. Analysis of large variations. Integer programming based models. 2. Optimization in networks: some models and algorithms. 3. Non-linear models. Formulation of problems. Optimization without restrictions on one or more variables. KKT conditions to nonlinear optimization with constraints. Programming: separable convex quadratic, non-convex.

II-Nondeterministic models 1. Decision theory. Probabilistic and non-probabilistic methods. Decision criteria in uncertainty. Value of information. Utility, indifference and risk. Risk premium. Decision criteria with risk. 2. Queuing models.

III-Decision trees Decision nodes, states and alternatives. Selection, qualification and assessment of alternatives. Bayes analysis in estimating probabilities. Information value. Sensitivity analysis. Contingency plans. Utility theory.

Evaluation can be periodic or by final exam.

Periodic evaluation (to be carried out during classes):

• Test 1 (theoretical-practical, about deterministic models): quoted for 7.0 points;
• Test 2 (theoretical-practical, about nondeterministic models and decision trees): quoted for 7.0 points;
• Work (with written report and oral presentation): quoted for 6.0 points.

  Requires that the sum of the two tests be greater than or equal to 7.0 points out of 14.

 The student is approved if the sum of the work and both tests is greater than or equal to 9.5 points and meets the required minimum.

Evaluation by final exam:

Exam, theoretical-practical, quoted for 20 points, to perform during exam periods. The student is approved if he/she obtains a grade greater than or equal to 9.5 points.

NAO