Q2: Lesson 2: Analysis and Intuition

System 1

• intuitive

• heuristic

• unconscious

• implicit

• fast

System 2

• analytics

• rule-based

• conscious

• explicit

• slow

Strategic Analysis

• more deliberate

• reflective

• computational

• rule-governed

• the process of conducting research on the business environment within which an organization operates and on the organization itself

• the environment in which the organization is operating together

SWOT Analysis

• Strengths - internal positive factors

• Weaknesses - internal negative factors

• Opportunities - external positive factors (growth or development)

• Threats - external negative factors (beyond one’s control that could put one’s strategy at risk)

• industry, business, education

PEST Analysis

• Political - legal laws or practices

• Economic - financial resources and value of money

• Social - demographics and culture

• Technological - current advancements in technology

• relevant external factors (macroenvironmental)

CBA Analysis

• Cost-Benefit Analysis

• calculating strengths (benefits, advantages) and weaknesses (costs, disadvantages)

• monetary value

CEA Analysis

• Cost-Effective Analysis

• effectiveness of outcomes

• effectiveness - the value of satisfying one’s interest or preference

• QALY (quality-adjusted life years) - improvement of the quality of life in the given number of years

• outcome of policies in the area of healthcare

• performance

SEU Analysis

• Subject Expected Utility

• provides a rational framework for choosing between alternative courses of action when the consequences resulting from the choice are imperfectly known

Heuristics

• mental shortcuts to simplify complex problems

• make judgements quickly and efficiently

• based on experience

Availability Heuristic

• how easily something can be recalled from memory

• likelihood of an event that comes to mind

Satisficing Heuristic

selecting the first satisfactory rather than searching for the optimal one

Risk-aversion Heuristic

choosing safer options over riskier ones

Loss-aversion Heuristic

avoiding losses strongly than seeking gains

Affect Heuristic

based on emotional reaction to a situation

Association Heuristic

two unrelated ideas or concepts due to mental link

Simulation Heuristic

possible scenarios or outcomes to evaluate the likelihood of an event

Similarity Heuristic

• how similar something is

• prototype

• category

Anchoring-and-Adjustment Heuristic

tendency to rely too heavily on an initial piece of information when making decisions and then making adjustments