Downloadable - About University

The main stages of the analysis 335
Next, the desirability of using each of the strategies was assessed in
relation to each benefit, starting with the North region. To do this, a value
scale which ranged from 0 to 100 was used with 0 representing the least
desirable effect and 100 the most desirable. This assessment was carried
out separately by the group for each individual region, so that in Table 13.1
the 100 in the ‘Market share’ column in the North region, for example,
means that strategy 2 was thought to be the better of the two strategies
available in the North for improving market share.
In the case of short-term profits, the group first estimated the profits
which might result from the different strategies as monetary values (these
figures are bracketed in the table) and these were then converted to values
under the assumption that a linear value function was appropriate. Of
course, in the case of ‘Risk’ a value of 100 denotes the strategy which
was judged to be the least risky. Thus in the West region a switch from
strategy 3 to strategy 2 would lead to a reduction in risk which was
considered to be 60% as attractive as the reduction in risk which would
result if the switch was made from strategy 3 to strategy 1.
Measuring each benefit on a common scale
Because the values were assessed separately for each region, a movement
from 0 to 100 for a particular benefit in one region might be more or less
preferable than the same movement in another region. To take this into
account, it was now necessary to measure these changes in benefit on a
common scale. To illustrate the nature of the problem, let us suppose for
the moment that just two regions were operated by the company, West
and East, and that a swing from the worst to the best strategy for market
share in the West was only seen as half as important as the swing which
could be achieved by changing from the worst to the best strategy in the
East. Figure 13.2 shows the two value scales for market share side by
side. Normally, the longest scale is used as the common scale. Therefore,
in this case, if we used the East’s value scale as the common scale it can
be seen that a value of 50 on the West’s scale will only have a value of 25
on the common scale.
The different lengths of the scales are measured by the within-criterion
weights. In this simple example the East would be allocated a withincriterion
weight of 100 for market share and the West a value of 50,
which means that on the common scale the West’s market share values
will only have 50% of their original values. The within-criterion weights
that were elicited for the furniture company problem are shown in
Figure 13.3 and we next describe how these weights were assessed.