A decision tree is a primary tool that a firm can use to conduct the capacity analysis. The analysis provides a schematic representation of the constraints and conditions present in a system. It also offers a connection between the conditions and the constraints to help predict the most viable and optimal solution in decision making. However, in a practical sense, tree analysis may not be fully guaranteed to help predict the best decision of the firm. The major limitation for tree analysis is because it simply presents the prevailing conditions and constraints of a system in the form of the chart only.

Decision tree utilizes only the currently available information which might be volatile in the real business setup which keeps changing rapidly.  In most of the cases, the decision tree does not provide for the provision of these changes. These calls for the managers’ capability to deal with such unforeseeable demanding situations rather than relying on decision trees and software.

References

GET THE WHOLE PAPER!