Friday, May 16, 2008

Cross Impact Analysis

Cross-impact analysis is a method for revising estimated probabilities of future events in terms of estimated interactions among those events. A concept introduced by Theodore Jay Gordon and Olaf Helmer in 1966.

In their initial application of cross-impact principles, Gordon and Helmer developed a game for Kaiser Aluminium and Chemical Company in the mid 1960s called Future. The company produced many thousands of copies of the game and used them as promotional gifts in conjunction with its 100th anniversary. The game, which is long out of print, involved a series of cards, each depicting a single future event. The cards were given an a priori probability of occurrence, based largely on Gordon and Helmer's judgment. Then a die was rolled to determine whether or not, in the scenario that was being constructed, the event "occurred." In the game, the die was an icosahedron with numbers written on the faces to correspond to the probability that that face would be turned up. If the probability shown on the die face was equal to or greater than the event probability, it "occurred." (Gordon)

It is a common methodology or approach used in multidiscipline to understands an event by identifying the cause and consequences. It is widely applied in researches by academicians, researchers, analysts and actuarial. Basically, cross impact analysis is about probabilities. The field of study can be apply in various disciplines such business / economics, political science, applied science and even national security. Many might have the perception the toughest part is doing the calculations of the probabilities. Don't be surprise that is not entirely true. The toughest part is actually at the initial stage; understanding the problems / issues and identifying the possible events deriving from the issues. Once the issues are properly addressed and identified, calculation will comes later easily. Not saying its really easy, but it'll helps a lot when issues are all being tackled.

An interesting case study can be illustrated from this mind game.

Side note: Joey, pinjam case study... Thanks.


yaya|azura said...

uihhh .. malas nak baca. hahahaha :P

~ayoi~ said...

Cik Yaya: Baru baca sikit dah pening kan? Cuba bayangkan orang yg kena belajar benda ni.. Huhuhu..

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