Strategic decision-making processes: Network-based representation and stochastic simulation

Abstract

Representation of decision-making in organizations is an intricate process. Qualitative Probabilistic Network (QPN)-based approach offers a scheme which is useful for representing processes involved in decision-making. This paper demonstrates the usefulness of QPN-based scheme with an illustrative case study. The focus of the case study is on understanding the strategic behavior of a key player in the Indian Automobile Industry. This is done by transforming Cognitive Maps developed into QPN-based formalisms and analyzing them. In addition to this, stochastic simulation experiment is performed on the QPN-based networks to generate hypothetical scenarios. © 1997 Elsevier Science B.V.