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What is a decision tree?

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What is a decision tree in project management? Is it a kind of analysis to make decisions in a project (or whether to choose a project or not)? Who's the person who creates the decision tree, is it the PM?
asked 3 years ago by anonymous

3 Answers

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A decision tree is a flowchart, where every element in the flowchart, with the exception of leaf elements, is a decision element about the project (in other words, it's usually a question with a "yes" or "no" answer, usually flowcharts represent these elements by a diamond). Leaf elements represent actions/activities (in flowcharts, activities are represented by rectangles).

Decision tree analysis helps project managers and stakeholders to take actions on the project after evaluating the decision tree.

Typically it's the project manager who creates the decision tree.

Here's an example of a decision tree analysis (because I can't add images to this website, I'm going to represent a decision element by (D) and an action element by (A):


- Outsource Development? (D)
-- (Yes) Outsource Project Management? (D)
--- (Yes) Create an offshore team and train an offshore project manager who will manage the team (A)
--- (No) Create an offshore team and manage the project remotely (A)
-- (No) Does the company have enough resources? (D)
--- (Yes) Develop locally (A)
--- (No) Hire more staff and develop locally (A)

Note that a decision tree can be much more complicated than the above, but I think you get the point.

Now here's a question, in a decision tree, is it necessary that every decision has a "yes" or "no" answer? I did a small research on this, and I discovered that some decision elements can have many branches (e.g. many answers), not just two, which makes a decision tree look even more complicated. ( Some project managers create decision trees that don't even look like flowcharts, here's an example: http://www.mindtools.com/media/Diagrams/Ted4_1.gif )
answered 3 years ago by anonymous
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It's a methodical approach to making choices among alternatives, and can be used by anybody. I don't see them used very often, which is a shame. It's a good tool. Google "fishbone diagram" or "Ishikawa diagram" and you'll get a little more context.
answered 3 years ago by anonymous
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The decision tree is exactly as you state it -- a tool to perform analysis and make decisions.  Decision tress have many applicatoins.  I can use them to compare projects or determine which risks are important to mitigate.  Decision trees can be drawn by anyone that needs one -- they will need to involve the right experts.
answered 3 years ago by sdcapmp (45,840 points)

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