Knowingly or unknowingly we use multi criteria decision analysis mainly in our procurement and hiring decision making. It is about giving weights for each parameter to be considered and then scoring against them.
Here is a multi criteria decision analysis for sub-contracting construction work;
Using the table above we are comparing the various proposals obtained from different contractors. The weights allocated for various parameters are as follows;
- Price – 50
- Experience – 20
- ISO certification – 10
- Start date – 20
The various proposals are scored against the criteria and in this case, Contractor-2 scores 90, which is the highest score, hence most probably the order will go to Contractor#2.
Whenever we are in a high value procurement process, it is advisable to use multi criteria decision analysis.