Systems analysis typically proceeds in the following sequence:
- Problem formulation;
- Selection of alternative approaches to solving the problem;
- Investigation of the resources expended on solving the problem;
- Construction of a model;
- Selection of evaluation criteria;
- Comparison of alternatives and decision-making.
Problem formulation is the most important element of systems analysis and includes stating the essence of the problem, defining the scope of the study, establishing the initial data, and identifying goals.
The selection of alternative approaches to solving problems consists of enumerating those alternatives (means) that, based on preliminary considerations, may be used to solve the stated problem. During the study, some alternatives are eliminated and new ones are introduced.
Investigating the resources expended on solving the problem is a key stage in economic analysis, during which the material and monetary requirements are determined. Typically, weapons systems are selected based on minimum cost for a given level of effectiveness.
The construction of a model is a stage of the study at which an analog of the real process is developed by representing the most essential factors through mathematical relationships (analytical models), via a computer (computer models), or through a special "game" (gaming models).
Modeling in systems analysis will occupy an ever greater place, particularly in connection with the development of mathematical modeling methods and computers.
The selection of evaluation criteria is an exceptionally critical stage of systems analysis and consists of specifying a quantity (or a system of quantities) whose numerical value can be used to judge the success of the solution. For the satisfactory operation of systems analysis methods, it is considered important that the criteria adopted at each level of management be linked into a single logical system. The most important criterion at the highest level (defense ministry leadership) is the system's cost-effectiveness ratio.
The comparison of alternatives and decision-making is the final stage of analysis, in which the means of solving the stated problem are evaluated against the chosen criterion. In addition to quantitative evaluation of the various alternatives, logical judgments may also be presented that indicate the preferability of one alternative over others.