Decision Trees - Lesson Plan: 2 x 1 hour lessons

A series of 'off the shelf' lesson plans and resources for use in the classroom. These lessons deal with Decision Trees and are relevant to the following specifications:

• AQA: Unit 6, 15.6
• Edexcel: Unit 4, Section 3
• OCR: Module 2880

Aim:

These lessons are intended to encourage students to think about decision-making in the context of a rugby club who have made rapid progress up the league structure. It is an issue that has faced a number of clubs in recent years - the jump to the National Leagues has been significant in terms of the necessity to adapt to a more business like approach demanded of professional clubs.

The potential benefits in terms of additional revenues from a host of things - TV, sponsorship, gate receipts, etc. has to be balanced against the costs of running a professional organisation. The gap between the leagues is such that those who do well in lower leagues struggle to maintain a presence in the revenue-generating leagues and as the realities of the investment necessary starts to bite, the financial difficulties spiral out of control.

The basic decision must be whether to invest now to get to the top or accept some element of mediocrity, but a greater degree of financial stability. This scenario presents a fictional club that has a difficult decision to make in terms of staying at its present ground and developing it - which may limit the extent to which it can expand in the future if it remains successful - against the possibility of moving to new premises that give it the infrastructure to survive but carries with it a much greater risk if the venture fails and the club struggles to compete on the field.

Some of the outcomes and some values have been given - students should be encouraged to question these values, how necessary they are and whether there are other factors they should include in their analysis. This Activity lends itself to group work and collaborative discussion - as with many business decisions there is not a hard and fast rule or specific answers - it will depend on how the students have constructed their analysis.

It is important, therefore, to encourage students to consider other factors that they think may be relevant but to justify why they might have felt it necessary to consider those factors.

The background information gives some hints as to what other factors the students should consider in making a final recommendation - the qualitative factors that need to be taken into account.

Learning Objectives:

At the end of these lessons, students should be able to:

• Demonstrate an understanding of the concept of a decision tree and be aware of the conventions in constructing a decision tree
• Apply their knowledge to a fictional scenario
• Make judgements as to the appropriateness of the information presented and what other information may be needed
• Construct a decision tree using the information given and calculate a final value to make quantitative judgements on a decision
• Show awareness of other factors that would need to be considered in arriving at decisions

Resources:

• PowerPoint Presentation - Decision Trees - [236 KB] (basic version also available for quicker download [203 KB])
• Mind Map - Decision Trees
• Activity - Decision Trees
• Digital projector and PC

Lesson Structure:

Lesson 1

1. Begin by reviewing key decision making methods - investment appraisal, critical path analysis. Briefly discuss the merits and drawbacks of such methods. (10 minutes)
2. Introduce the idea of decision trees as another means of contributing to decision making in organisations. Use the Presentation to identify the main features of this method. (25 minutes)
3. Introduce the Activity - get students to read through it and then divide into groups as appropriate. (5 minutes)
4. Set students onto the task. (15 minutes)
5. Review the main points of the lesson and outline tasks for the next lesson. (5 minutes)

Lesson 2

1. Remind groups about the task ahead. (5 minutes)
2. Allow students time to complete the task of constructing the decision tree. (30 minutes)
3. Bring groups back together for the feedback discussion. Different groups may have different final values - discuss why this might be. (20 minutes)
4. Set homework task to write the 750 word report on other factors to be considered in the final decision making and review main outcomes of the lesson. (5 minutes)