Nelson Higher Education

Higher Education

Making Hard Decisions with DecisionTools, 3rd Edition

  • Robert T. Clemen
  • Terence Reilly
  • ISBN-10: 0538797576
  • ISBN-13: 9780538797573
  • 848 Pages | Hardcover
  • Previous Editions: 2004, 2001, 2001
  • COPYRIGHT: 2014 Published
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About the Product

MAKING HARD DECISIONS WITH DECISIONTOOLS® is a new edition of Bob Clemen's best-selling title, MAKING HARD DECISIONS. This straightforward book teaches the fundamental ideas of decision analysis, without an overly technical explanation of the mathematics used in decision analysis. This new version incorporates and implements the powerful DecisionTools® software by Palisade Corporation, the world's leading toolkit for risk and decision analysis. At the end of each chapter, topics are illustrated with step-by-step instructions for DecisionTools®. This new version makes the text more useful and relevant to students in business and engineering.


  • Topics are illustrated with step-by-step instructions for DecisionTools®.

  • The textbook offers tutorials for using the DecisionTools® software.

  • The end-of-chapter materials include a wide variety of exercises, questions, problems, and case studies. The exercises are accessible, while questions and problems offer an added challenge to students.

  • Many case studies, both real-world and hypothetical, are included to provide additional applications of decision analysis.

  • Real Options coverage has be added in the new Chapter 13, as requested by adopters.

  • The former Chapter 6 on Creativity has been replaced by a new chapter on organizational decision making, as requested by adopters and reviewers.

  • 12 new cases have been added from the respected Darden School at the University of Virginia. References, screenshots, examples, exercises, and problems have been updated to provide students with the newest information.

  • Chapters 8, 4, 15, and 6 have been updated to reflect the latest trends in the psychology of judgment and decision making.


"The book is very usable for students, even if they don't use it for class. I recommend to all my students that MAKING HARD DECISIONS should be part of their professional library." - Andrew G. Loerch, George Mason University
— Andrew G. Loerch, George Mason University

About the Author

Robert T. Clemen

Robert T. Clemen is Professor at the Fuqua School of Business at Duke University. He has been an active contributor to the field of decision analysis since earning his Ph.D. at Indiana University in 1984 and is an authority in the use of expert information in decision and risk analysis. He has interests in applying decision analysis in the areas of energy use and corporate sustainabiligy. Aside from his research interests, Bob has a strong focus on making decision analysis understandable to all students at all levels, ranging from high school students to executives.

Terence Reilly

Terence Reilly is an associate Professor of Mathematics at Babson College. His interests include developing innovative curriculum for MBA programs, particularly distance programs, along with simulation and decision analysis. His research interests are in developing sensitivity analysis techniques and fitting distribution curves to univariate and multivariate uncertainties. Recently, he has developed courses in financial methods using simulation and decision analysis.

Table of Contents

1. Introduction to Decision Analysis.
2. Elements of Decision Problems.
3. Structuring Decisions.
4. Making Choices.
5. Sensitivity Analysis.
6. Organizational Decision Making.
7. Probability Basics.
8. Subjective Probability.
9. Theoretical Probability Models.
10. Using Data.
11. Monte Carlo Simulation.
12. Value of Information.
13. Real Options.
14. Risk Attitudes.
15. Utility Axioms, Paradoxes, and Implications.
16. Conflicting Objectives I: Fundamental Objectives and the Additive Utility Function.
17. Conflicting Objectives II: Multiattribute Utility Models with Interactions
18. Conclusions and Further Reading.