the theoretical approach to the practical implementation of the cost-benefit analysis is suitable as non-monetary assessment procedures from the scope of decision theory for decisions with relevant approach. With her various sub-objectives are made similar to be able to choose between several alternatives. But successfully for decision making to be able to use the cost-benefit analysis, it must deal first with the flow chart. The flow chart is typically as follows: to make comparable divided into sub-criteria to various alternatives, to achieve a top objective, this overall objective must be first divided into different objectives. When it comes to buying a car, for example, such for example the consumption objectives, space, environmental or similar might be. Weighting of the subcriteria because usually this under criteria in the order are recorded, the one they invade, they must be first time weighted or prioritized.
If an example mentioned above, first the Environmental impact occurs, then this is the most important criterion of under Yes to not automatically. Normally, space is rather critical. It is usually this prioritization with a point rating of 1 (not important) to 10 (very important). Multiplication of the sub-objectives and totals when all sub-goals prioritized, then one can assess the achievement of objectives. Also here a point rating of 1 (for not achieved) to 10 (for fully achieved) is advisable. Furthermore, multiplying now the objectives with the previously assigned priority code.
This is done for all objectives and for all different alternatives in this example just for all cars. Source: clayton echard. Adding up the results of the multiplication of the individual sub-objectives now each for the various alternatives, to get the total or the Grand total of each alternative. Thus, the alternative with the highest number is winner”and this alternative is also that which is the best to achieve the overall objective. To check the strength of his results, so you can test the cost-benefit analysis, sometimes with slightly different priorities sensitivity. This is especially then, when several people in the decision-making process involved. Since then various priorities there is various opinions and requests. Also a sensitivity test is then, if one has identified many different objectives. No matter for what reason you carry out this test, it is very good, to verify your result and resilient to make. The above described very theoretical sequence is especially suitable to make different (actually not comparable) alternatives comparable. Through documentation of the objectives and the priorities, it is ensured that the decision path can be traced at any time. This traceability means that you can review later also the quality of its decision and in some circumstances when a similar or similar Its own decision quality improve decision.
