An operations manager is performing a factor-rating analysis to help him choose

Question

An operations manager is performing a factor-rating analysis to help him choose an outsourcing provider. He is focusing on two facors: A and B, using a weight of 75% for factor A and 25% for factor B. He has scored five dierent potential providers on both factors, using a scale ol 1-5, with 1 representing the BEST score. Based on the scores provided in the table below which provider should be chosen? Provider Factor A Factor B Alpha Beta Gamma Phi Omega O A. Ph O B. Omega O C. Gamma OD, Alpha E. Beta

Explanation / Answer

Given that 75% percentage, weight is given to factor A and 25% to factor B

and 1 is treated as best and 5 is treated as worst on the scale of 5, so the cumulative score which is the lowest of all should be treated as best

Alpha = (0.75*1) + (0.25*5) = 2

Beta = (0.75*3) + (0.25*3) = 3

Gamma = (0.75*4) + (0.25*1) = 3.25

Phi = (0.75*2) + (0.25*1) = 1.75

Omega = (0.75*3) + (0.25*5) = 3.5

Therefore Phi is the one with the least cumulative score and best quality score.

Hence the answer is option A. Phi

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