This three-part post will walk step-by-step through a multi-criteria analysis, a formal decision process you might use when making a weighty decision. Here are the steps:
- Step 1: Complete your research
- Step 2: Generate and weight criteria (i.e., define your desired outcome)
- Step 3: Identify and/or create options, alternatives or solutions
- Step 4: Complete a side-by-side comparison
- Step #5: Objectively assess each option against each weighted criterion
- Step #6: Make your decision
The steps are listed linearly for ease of understanding. But rarely does a decision process unfold without iteration. Thoughtful multi-criteria analysis leads you to loop back-and-forth between steps, clarifying and refining your thinking as you go. For example, although you may begin with an initial set of options, that set will likely be refined and enriched as you complete your research, generate and weight criteria, apply the criteria and move to decision-making.
Step 1: Complete your research
Whether buying a car or house, choosing a college or making some other consequential choice, you need first to become well informed.
- What do I need to know?
- What are my requirements?
- Are there constraints?
- What are the options?
- How can I compare those options fairly?
In my experience, folks make two critical mistakes at this phase of decision-making. They do not invest sufficient time or resources in research, and they move to decision-making before they have investigated a wide range of options.
Consider the college search process. In terms of financial investment, it is one of the more significant decisions a typical family will make. In New York State, the total four-year investment at a public institution approaches $80,000 and at a private institution often exceeds $200,000. In some cases it tops out at $250,000.
Nonetheless, it is common for overwhelmed families to skimp on or rush through the information gathering phase. I have heard parents remark that they couldn’t afford to purchase the standard college guides, such as the Princeton Review ($22.99), because they are too expensive! I know students who neglected to use amortization calculators to determine the true cost of their student loans, both in terms of monthly payments and total payback with interest. Families often visit few college campuses before making their final selection. The consequences of these short-cuts are predictable. For example, after dropping her child off at college for the first time, a mom I know lamented: I was surprised how rural it was.
Multi-criteria case study
Consider this case study. Prism recently facilitated a diverse team of school district stakeholders through a successful multi-criteria decision. The Elmsford Union Free School District facilities planning task force was grappling with a complex decision. Elmsford’s Dixson Primary, a PK-1 building built in 1894, enjoys the love of many community stakeholders but is considered woefully inadequate to serve the needs of its students. The issue is emotional and many task force members arrived with preconceived notions: some, that the building needs to be closed; others, that building should be renovated. There was conflict and disagreement.
The planning process required that the team step back from their preconceived notions and thoroughly research the issue. For example, they spent considerable time walking through the facilities and researching state education law, financing and other issues. They needed to build a shared knowledge base so that their conversations — including their disagreements — could be informed by fact wherever possible. As shared knowledge grew and many untested assumptions proven invalid, the conversation became less polarized and more informed.
Step 2a: Generate criteria
Once they were well-informed, the task force began to list its criteria. A criterion is a standard, rule, or test on which a judgment or decision can be based. For example, if you are buying a house, a criterion might be “number of bedrooms” or “size of the yard.”
The Elmsford task force went through a creative process, diverging to consider many criteria and then converging on a final set of eleven. They defined their criteria clearly and simply, using a few words, like a book title, followed by a succinct definition. They agreed to eleven criteria, including “Multi-purpose: there is a large, multi-purpose room that has a stage and that can accommodate the school population” and “Flexibility: the facility has the flexibility to accommodate short- and long-term growth,” among others.
A family selecting the best college can use a similar process. Using 3 x 5 cards, articulate one criterion per card until all possible criteria have been listed. As a family, share, clarify, combine and refine your criteria. Then converge on a final set. Like the Elmsford task force, you will have defined your desired outcome and now know explicitly what you want to achieve. In the parlance of IT professionals, you will have completed your requirements analysis. Or, simply put, now that you know what you want, you just might get it.
Step 2b: Weight criteria
With the decision criteria agreed to, you can now weight them. First, order the final set of 3 X 5 cards in declining order of relative importance. Then assign a weight (between 0 – 100) to each criterion, making sure that the sum of all weights totals 100. Then begin to build a decision matrix, either using a table or, preferably, a spreadsheet. Place the weighted criteria in the top row. Later, you will add the options into the first column. See the sample decision matrix above. Or feel free to download the working spreadsheet.
The Elmsford task force used Prism’s Group Decision Support System™ to weight their criteria by completing a paired comparison analysis. View their results in the chart below.
Having identified and weighted your criteria, you are well on your way to creating a sound decision framework. In How to: Multi-criteria Analysis – Part 2, we discuss how to advance this framework by adding a set of options and completing a side-by-side comparison.