January 2020
was slashed by Congress to $3.5 million, then options 1 and 2 should be eliminated.WhileFigure 1 shows the efcient frontierwhere the constraints such as number of options allowed and budget were varied to determine the efcient portfolio selection, Figure 2 shows multiple portfolios with diferent objectives. For instance, the fve models shown were to maximize the fnancial bang for the buck (minimizing cost and maximizing value while simultaneously minimizing risk), maximizing Naval Operations (OPNAV) value, maximizing knowledge value added (KVA), maximizing Command value, and maximizing a Weighted Average of all objectives. This capability is important because, depending onwho is doing the analysis, their objectives and decisions will difer based on diferent perspectives. Using amultiple criteria optimization approach allows one to see the scoring from all perspectives. The option with the highest count (e.g., option 5) would receive the highest priority in the fnal portfolio, as it satisfes all stakeholders’ perspectives and, hence, would be considered frst, followed by options with counts of 4, 3, 2, and 1.
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Defense ARJ, January 2020, Vol. 27No. 1 : 60-107
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