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STEM Commons · Mathematics, statistics and data

Decision analysis under uncertainty

Decision analysis under uncertainty provides structured methods for choosing among options when outcomes are uncertain and objectives conflict. It makes trade-offs and value judgements explicit. Systemic Risk Management stewards this page for the Nexus Consortium.

01In brief

The short answer.

Decision analysis under uncertainty provides structured methods for choosing among options when outcomes are uncertain and objectives conflict. Decision analysis helps choose actions that perform acceptably across interconnected risks and uncertain futures. In the Nexus Consortium, Systemic Risk Management stewards its canonical page, and 13 other platforms apply it, including Nexus Campaigns and Nexus Agency.

02Geography

Systemic exposure in Mexico.

Where people and networks concentrate, the exposure through which shocks travel between systems, shown for Mexico as an example geography for this subject.

Where people and networks concentrate, the exposure through which shocks travel between systems.Indicator derived from Natural Earth at map scale; a screening view, not an assessment.
GCRI · institution · fieldDESIGN FIGURE
03The method

What decision analysis under uncertainty covers.

  1. 01

    Core methods

    decision trees; multi-criteria decision analysis; value of information analysis; robust decision making; expected utility analysis; adaptive pathways planning.

  2. 02

    Data and instruments

    expert elicitation; model outputs; stakeholder preference surveys; cost and benefit estimates; scenario sets.

  3. 03

    Validation

    Analyses are checked through sensitivity analysis, peer review and stakeholder scrutiny. Retrospective review compares decisions with outcomes.

  4. 04

    Limits

    Results depend on elicited probabilities and preferences that may be biased. Deep uncertainty can make expected value comparisons misleading.

  5. 05

    Use in risk decisions

    Decision analysis helps choose actions that perform acceptably across interconnected risks and uncertain futures. It clarifies when to act now and when to keep options open.

04Reference practice

Decision analysis is codified in risk and evaluation practice.

ReferenceWhat it sets
ISO 31000 risk treatmentSelecting treatment options
Robust decision-making and dynamic adaptive pathwaysDecisions under deep uncertainty
Cost-benefit and multi-criteria analysis guidanceAppraisal of options
05In systemic risk work

Choosing when probabilities are contested.

Under deep uncertainty, decision analysis seeks options that perform acceptably across many futures and adaptive pathways that can change course as information arrives. It supports decision-makers; it does not replace their judgement on values.

  • Make value judgements explicit.
  • Identify signposts that trigger pathway changes.
  • Compare options across scenarios.
  • Applications on Risk Management and Disaster Resilience and Recovery.
07Stewardship

Who maintains this page.

Systemic Risk Management stewards decision analysis under uncertainty: it keeps this description current and reviews how the method is applied across the platforms.

08Key terms

Terms used on this page.

Each term as this page uses it. Where a standard-setting body defines the term, the wording follows that body.

TermDefinition
Design standardThe hazard level, such as a return period, that infrastructure is built to withstand.
Value of further diligenceThe expected improvement in a financing decision from more investigation before committing.
Pipeline screeningRanking candidate projects against stated criteria before preparation.
Self-sufficiencyA funding position at which a scheme needs no further sponsor support under prudent assumptions.
09Sources

Where this page's references lead.

The bodies and documents this page is read against. Status and editions change; each link goes to the issuing body.

11Questions

Questions and answers.

Why does one institution host every method page?
GCRI hosts the STEM Commons so that each method has one canonical description. Platforms link to it rather than repeat it, which keeps definitions consistent.
How do I suggest a correction to a method page?
Write to integrity@therisk.global with the passage and the reason.
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