A company is deciding between 2 foreign firms to provide its call center service

Question

A company is deciding between 2 foreign firms to provide its call center services. A factor-rating method is used. Factors are rated on a scale of 1-10, with 10 being the best score. A: If the factors are weighted equally (respective weights of 3333), which firm is preferred? B: Suppose a consultant recommended that Factor 2 be twice as important as Factor 1, while Factor 3 should be four times as important as Factor 1. Which firm is best now using a weighted method? (Round your weights to the nearest four decimal places.) FirmFactor 10 Factor 2 Factor 3

Explanation / Answer

(A)

Factors are having equal weights. So, assign (1/3) weight to all the three factors

* 10 x (1/3) + 7 x (1/3) + 4 x (1/3) = 7

A is preferred over B

(B)

Choose weights as per the ration specified. Make sure that the sum of weights become 1.

* 10 x (1/7) + 7 x (2/7) + 4 x (4/7) = 5.7143

B is preferred over A

Firm Factor 1 Factor 2 Factor 3 Weighted score A 10 7 4 7.0000 * B 5 8 6 6.3333 Weights 1/3 1/3 1/3

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