# Economics of SharePoint Governance Part 3 The Nature of the SharePoint Administrator Decision Problem

SharePoint administrators may make a myriad of decisions every day. Some of the decisions are trivial in the sense that the consequences of them do not matter very much. The consequences of other decisions, for example, what infrastructure maintenance plan to adopt or whether to add or drop a development piece from the company’s product mix may be monumental. I shall assume as an operating premise that SharePoint administrators are basically interested in the farm welfare. Rational behavior consists of trying to maximize the value of some positive quantity, or to minimize the value of something perceived as having negative connotations. Administrator approaches to decisions may be categorized as capriciousness, conditioned response, and deliberate, reasoned choice. The more trivial the consequences of the SharePoint decision, the less time and effort are devoted to the decision process. Sometimes people seem to act without engaging in any apparent decision-making process. The choices underlying such actions may have been nearly automatic, based upon an implicit summing-up of the current circumstance compared with the SharePoint administrator’s accumulated stock of past experiences under similar circumstances. Occasionally, however, administrators indulge themselves in a capricious action (an act without deliberate choice), even when the consequences may be non-trivial.

The SharePoint administrator may be confronted with a multiplicity of goals. Since it is technically not possible to try to maximize simultaneously the values of multiple conflicting SharePoint goals, the decision maker has to choose one of the goals for primary pursuit. The other goals, expressed as minimum or maximum acceptable values, can then be regarded as constraints on the pursuit of the primary goal. The object of the decision is to maximize the value of the primary goal, subject to realization of satisfactory levels of subordinate goals.

With respect to any single SharePoint goal, a decision involves multiple possible courses of action, or strategies. If there were no alternatives, no decision would be required other than selecting the SharePoint goal for pursuit. The deliberate approach to decision making involves the identification of all possible courses of action and the benefits and costs likely to result from each of the alternatives. The rational choice is the alternative that yields the greatest relative positives or the largest sum of net benefits (positives less negatives), given the SharePoint administrators set of preferences.

In many cases, the SharePoint choices are not mutually-exclusive alternative courses of action; rather they involve more or less of the same course of action. The range of possible alternatives includes larger or smaller quantities to be selected. Typically, the SharePoint administrative problem is to select some quantity that is an alternative to the present one. Assuming that the alternative quantities are arrayed from smallest to largest, or vice-versa, choosing to shift from one to another involves additions to or subtractions from benefits or costs. Economists speak of such additions and subtractions as incremental changes, or marginal changes if they are the smallest possible changes that can be made. The rational administrative choice in such cases is to make a quantitative change that will yield the greatest marginal benefit relative to marginal cost.

Often the possible alternative courses of action can be identified, but each decision alternative may have several outcome possibilities. If the decision maker can in some meaningful sense assess the probability, p, of the occurrence of each possible outcome, V, for each of the alternative courses of action, he may then compute the expected value of each alternative. The expected value is a probability-weighted average of the possible outcomes for each decision alternative,

(1) EV = p_{1}V_{1} + p_{2}V_{2} + … + p_{k}V_{k},

or

(1′) EV = S_{j=1,k} (p_{j}V_{j}),

Where EV is the expected value of the alternative, p is the probability of the outcome V for each of the k possible outcomes of the alternative. The presumption here is that the sum of the probabilities of the possible outcomes is 1.0. Each outcome may itself be a net difference between benefit (b) and cost (c), or V = b – c. Other things remaining the same, the rational decision then is the choice of the alternative that promises the largest expected value of possible outcomes.

An extension of the expected value concept may be employed in SharePoint governance decision situations that unfold in stages such that subsequent stages depend upon what happens in previous stages. In such cases, the probability of occurrence of an ultimate outcome is a conditional probability, i.e., the product of the probabilities of the final outcome and all prior stages. Such a situation can best be visualized with a “decision tree”.

**This series is a lot of parts that I am quasi-using pieces of for a academic research paper stance so bear with me if it gets too esoteric. Or read the other governance articles available within the SharePoint Security category within the main site (available through the parent menu).**