Capturing Uncertainty

Not all Pro and Con are certain to exist.

Say, you want to decide if you want to rent an apartment or buy a house. You have listed the following Pros and Cons.

Pros Cons List

Now, think about it. There can be some expenses which will be paid by Landlord. But, how likely you will save the maintenance cost. Within a year lease, there can be a 50% chance that you may face something broken which will be paid by the landlord. It may happen or it may not happen.

Also, think about the con "Could be forced to move out if the owner sells the property". It is definitely a Con when renting an apartment. If that happens, it can highly impact you, but how likely that can happen? Very low probability, right? Ok, let's think that the probability is 25%.

Also, we can assume that, after renting a property, there can be lots of restrictions, but the rental management can be very liberal too. You do not know yet. So, that is an uncertain Con as well.

When analyzing Pros and Cons, you should consider the Importance or Impact of a Pro and Con. You should also consider the Probability of an Uncertain Pro / Con. Otherwise, you may choose an option with a Good Looking Pro where the probability of the outcome of that Pro is very low. That will be a bad decision, right?

Using the SpiceLogic Pros and Cons Analyzer, you can mark a Pro/Con as Uncertain and then you can specify the Probability of that Pro/Con. Then this tool will calculate the Expected Value based on that probability in the final calculated. That will be a very reasonable way of performing the analysis.

Here is the screenshot of the Pros/Cons where Uncertainty checkbox is checked to mark a Pro/Con as Uncertain. Also using a slider, the probability of the uncertain Pro/Con is specified.

Capture_ Uncertainty

Last updated on 21 February 2020, Friday, 2:35:42 PM