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Weighted Scoring Model (Utility Analysis).
A weighted scoring model (in German Nutzwertanalyse, also known as utility analysis) is a decision method for comparing several alternatives against weighted criteria. Each option receives points per criterion, these are multiplied by the weighting and added up; the highest total shows the best solution according to the chosen criteria.
Weighted Scoring Model (Utility Analysis) — Explained in Detail
Many business decisions involve more than one criterion. When choosing software, price, functionality, usability, data location, interfaces and support all count; when choosing an agency, expertise, references, availability and costs. A weighted scoring model makes such decisions traceable by translating gut feeling into a table — and forces you to set the weighting in advance.
The procedure has five steps. First: collect the criteria that really matter, and no more than seven to ten. Second: weight each criterion so that the total comes to 100 per cent. Third: define a rating scale, for example 1 to 5 or 1 to 10. Fourth: rate each alternative per criterion. Fifth: multiply points by weight and add them up. At the end, each option has a utility score.
The method is only as good as the weighting. Anyone who rates first and weights afterwards unconsciously calculates their way to the desired result. The weights should therefore be set before the offers are known in detail, and ideally by several people. Knock-out criteria are also worthwhile: if an option does not meet a mandatory condition, such as data storage in Switzerland, it is eliminated, however many points it would otherwise score.
A weighted scoring model does not replace a cost-effectiveness calculation. It says which solution best fits the requirements, not whether the investment pays off. In practice it is therefore combined with a multi-year cost view, the total cost of ownership, and for software with the make or buy question.
Example: choosing a CRM for an SME
Suppose an installation business with 25 employees compares three options: a standard CRM, an industry solution and a tailor-made web app. The criteria and weights: coverage of its own processes (30 per cent), usability on a phone (20 per cent), costs over five years (20 per cent), interface to the accounting system (15 per cent), data storage in Switzerland (knock-out criterion) and dependence on the provider (15 per cent).
The result is not automatic, but it is a basis for a structured conversation. Often it turns out that one criterion was underestimated, such as usability for fitters on the road. For weighing up buying versus building there is the page CRM: Buy or Build; for choosing a service provider, Choosing an Agency in Switzerland.
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Make or BuyFrequently Asked Questions About Weighted Scoring Model (Utility Analysis)
Five to ten are usually enough. With more criteria, each one gets such a small weight that it hardly influences the result, and the rating becomes busywork.
Conditions that must be met without exception. An option that does not meet a knock-out criterion is eliminated before any points are awarded. Typical examples are legal requirements, data storage or a maximum budget.
It appears more objective than it is: weighting and points remain judgements. Nor does it express costs and benefits in francs. It is therefore suitable as a structuring aid and as documentation of a decision, not as the sole proof.
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