How to compare apples and oranges

apples and orangesToo many conflicting goals! This is where many decision makers give up and make do. I’m looking to buy a car. I want low price, good mileage and a roomy trunk, among other things. But how do you compare dollars, miles per gallon and cubic feet? Sometimes more is better (trunk capacity) and sometimes less is better (cost). How can you choose? It’s like comparing apples and orange, and everyone knows you can’t compare apples and oranges.

Believe it or not, you can compare apples and oranges. In fact, as an effective decision maker, you must.

The simplest way to help you think about multiple alternatives and multiple goals is to make a grid with alternatives being the columns and goals, constraints and considerations being the rows. (or vice versa. I’ve done it both ways.)

Then fill in the blocks with some assessment, number or information. Here’s an example of choosing an office supply source for your business.

Business Resources Store The Office Center Acme Office Supply Mega Office
Prices 10% quantity discounts Full price Some special deals 15-20% discount on everything
Inventory Sometimes out of stock Complete No toner Complete
Delivery Free 5-day Guaranteed next day, free Unreliable None
Service Good Very good Good Poor

Sometimes this is all you need to get the answer to pop out or at least eliminate some poor choices. Even if all your choices still look good, this grid is a good start on just about all the effective techniques for making a choice with multiple goals. Some of these I’ll discuss in more detail in future posts.

The simplest is a weighted score. You’ve probably seen it before, because it works.

Weight Business Resources Store The Office Center Acme Office Supply Mega Office
20 Prices 4 1 2 5
10 Inventory 3 5 4 5
5 Delivery 4 5 2 1
10 Service 3 4 3 2
Total score 160 135 120 175

Put a numerical score (more is better) in each block. Here we’ve used a scale of 1 to 5, with 1 being very poor and 5 being excellent.

Some of your goals are more important than others. Give each one a weight proportional to its importance. It doesn’t really matter how you do this. Here, we decide that prices are twice as important as inventory. We also consider service and inventory equally important and twice as important as delivery. Put those numbers in a new column at the left.

Now get a total score for each alternative by multiplying each score by the corresponding weight and adding them together. For example, the score for Business Resources is 20*4 + 10*3 + 5*4 + 10*3 = 160. By the way, if you use Excel, you can do this with the function SUMPRODUCT.

In our example, Mega Office comes out the best, mainly because they have good prices and that’s important to us.

This grid can be used for more precise comparisons, such as Even Swap or SMART. More about that later.

Leave a comment. I’d love to hear your experience. How do you balance multiple conflicting goals?

One response to “How to compare apples and oranges

  1. Pingback: A SMART way to choose a car, or anything else | Take Charge

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