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Parent Node(s):
SYSTEMS ANALYSIS
This term has many different meanings. In
the sense adopted for the Handbook, systems analysis is an
explicit formal inquiry carried out to help someone (referred to
as the decision maker) identify a better course of action and
make a better decision than he might otherwise have made. The
characteristic attributes of a problem situation where systems
analysis is called upon are complexity of the issue and
uncertainty of the outcome of any course of action that might
reasonably be taken. Systems analysis usually has some
combination of the following: identification and
re-identification) of objectives, constraintS, and alternative
courses of action; examination of the probable consequences of
the alternatives in terms of costs, benefits, and risks;
presentation of the results in a comparative framework so that
the decision maker can make an informed choice from among the
alternatives. The typical use of systems analysis is to guide
decisions on issues such as national or corporate plans and
programs, resource use and protection policies, research and
development in technology, regional and urban development,
educational systems, and?alth and other social services.
Clearly, the nature of these problems requires an
interdisciplinary approach. There are several specific kinds or
focuses of systems analysis for which different terms are used:
A systems analysis related to public decisions is often referred
to as a POLICY ANALYSIS (in the United States the terms are used
interchangeably). A systems analysis that concentrates on
comparison and ranking of alternatives on basis of their known
characteristics is referred to as decision analysis.
That part or aspect of systems analysis that concentrates on
finding out whether an intended course of action violates any
constraints is referred to as FEASIBILITY analysis. A systems
analysis in which the alternatives are ranked in terms of
effectiveness for fixed cost or in terms of cost for equal
effectiveness is referred to as COST-EFFECTIVENESS analysis.
COST- BENEFIT ANALYSIS is a study where for each alternative the
time stream of costs and the time stream of benefits (both in
monetary units) are discounted (se?DISCOUNT rate) to yield their
present values. The comparison and ranking are made in terms of
net benefits (benefits minus cost) or the ratio of benefits to
costs. In risk-BENEFIT ANALYSIS , cost (in monetary units) is
assigned to each risk so as to make possible a comparison of the
discounted sum of these costs (and of other costs as well) with
the discounted sum of benefits that are predicted to result from
the decision. The risks considered are usually events whose
probability of occurrence is low, but whose adverse consequences
would be important (e.g., events such as an earthquake or
explosion of a plant). See: operations research (IIASA)
The diagnosis formulation, and solution of problems that arise out of the complex forms of interaction in systems, from hardware to corporations, that exist or are conceived to accomplish one or more specific objectives. Systems analysis provides a variety of analytical tools, design methods and evaluative techniques to aid in decision making regarding such systems. (Krippendorff)
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