An influence diagram (ID) (also called a relevance diagram, decision diagram or a decision network) is a compact graphical and mathematical representation of a decision situation. It is a generalization of a Bayesian network, in which not only bayesian inference|probabilistic inference problems but also decision making problems (following expected utility|maximum expected utility criterion) can be modeled and solved.
ID was first developed in mid-1970s within the decision analysis community with an intuitive semantic that is easy to understand. It is now adopted widely and becoming an alternative to decision tree which typically suffers from exponential growth in number of branches with each variable modeled. ID is directly applicable in team theory|team decision analysis, since it allows incomplete sharing of information among team members to be modeled and solved explicitly. Extension of ID also find its use in game theory as an alternative representation of game tree.