4.1 Decision matrix analysis

Watch this short video from Mind Tools explaining the process of the decision matrix analysis.

Download this video clip.Video player: Video 3

Show transcript|Hide transcript

Transcript: Video 3

[MUSIC PLAYING]

INSTRUCTOR

There are often many competing factors to take into account when it comes to making a decision. And figuring out which of them should take priority isn't always easy. Decision matrix analysis helps you make a good decision when you need to weigh out many difficult to compare factors. To use this approach, first list all the options available to you as rows in a table. Then, list the facts that you need to consider as column headings. For example, if you're trying to choose between three suppliers, you might want to compare each one in terms of their location, price, and reliability.

Next, you need to figure out the relative importance of each factor. For example, is location more important than price? Is reliability what matters most? Go through your table again and decide on the importance of each factor using scores from 1 to 5. 1 means that the fact is relatively unimportant in the final decision. 5 means it's very important. Now go through the options in the table and score them against each factor. For instance, in our example, you give each supplier a score between 1 and 5 for how well they meet the location, price, and reliability factors.

Next, multiply these by the relative importance scores you've already entered for each factor. Then, total them up for each option. When you've completed this last step, the option with the highest score will be your best choice. Sense check this against your intuition. If this differs, consider why this is and reflect on the scores and weightings that you've applied. This may be a sign that certain factors are more important to you than you initially thought. To learn more about how to use decision matrix analysis, read the article that accompanies this video.

[MUSIC PLAYING]

End transcript: Video 3

Download

Video 3

Here’s a worked example:

Stanley is at university in Manchester and his parents live in Sheffield. He is trying to decide between three different offers of work experience. One is with an investment bank in London, one is with a social enterprise that works with young offenders in Brighton and the other is within the widening participation department at his university. He can’t decide between them as they all have different attractions.

He decides to do a decision matrix analysis. His first step is to populate the table below. He chooses salary, location and values as the three factors that are most important to him.

When he assesses the factors, the investment banking role scores highly for salary whereas the widening participation job scores highly for location, as he could just stay living in his current student house. The social enterprise role aligns closely with his values and so scores 4.

The widening participation role has the highest overall score as it aligns well with Stanley’s values, is in a very convenient location and offers a good salary. He can now check whether that sits well with his intuitive feeling about the role. If not, he can explore his scores again and think about the issues that have been raised.

Now it’s your turn!

If you want to explore decision matrix analysis further, visit the Mind Tools website [Tip: hold Ctrl and click a link to open it in a new tab. (Hide tip)] and look for ‘Decision Matrix Analysis’. This will be one of three articles you can access for free.