What to Do When Decision-Makers Deviate from Model Recommendations? Empirical Evidence from Hydropower Industry

Research output: Contribution to journalArticleScientificpeer-review

Researchers

Research units

  • UPM Kymmene

Abstract

Decision makers do not always follow recommendations from model-based decision support systems. We suggest that analyzing the differences between decision recommendations produced by prescriptive models and the behavior of the decision makers provides valuable insights that can be utilized to improve model-based decision support processes. Specifically, we develop an intervention process in the context of hydropower production planning to study the motivations of decision makers and the ramifications of their behavior. The analysis is based on deviations between recommendations of an in-house optimization tool and actual decisions, enhanced by planner feedback collected from a daily web-survey. We find that even though the planners make some adjustments with positive financial impact, their actions mainly worsen the performance of the production plan. Using the collected data, we identify several reasons for the deviations and recommend multiple enhancements to the planning process. For example, we propose a shift from output-adjusting to input-adjusting interaction between human planner and model. Altogether our facilitated modeling project shows that combining objective and judgmental process feedback is superior for recognizing corrective actions and systematically improving model-driven decision processes. Furthermore, the intervention process developed for this case gives structure for the lifecycle management of model-based decision support systems.

Details

Original languageEnglish
Pages (from-to)869-882
Number of pages14
JournalEuropean Journal of Operational Research
Volume278
Issue number3
Early online dateApr 2019
Publication statusE-pub ahead of print - Apr 2019
MoE publication typeA1 Journal article-refereed

    Research areas

  • Decision Support Systems, OR practice, Empirical Research, Energy-related Operations

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