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Home Who and What The Author The Choice Introduction Head Guts Ranking Mine fields Pig Producing Options Sluice Gate options Regional development Projects Enterprises in ethnic conflict zones Paying for Performance Executive Bonuses Poverty Reduction Support Sector Support Contact
Weighting, the Guts part of a ChoiceThe scales above, borrowed from Fred Flintstone show how the total weight of the three stones is divided 66% on the left and 33% on the right. The weighting of priorities and interests is approached in a similar way: The total weight of all priorities is 100%. In the case of four equal priorities, the relative weight of each will be 25%. When more weight is put on one of the four, for instance one is given twice the weight of the other three, the relative weight of the first will become 40% and of the other three each 20%.Levels in WeightingThe examples show decision structures of more than one level of priority. At each level it is possible to apply weights ranging in scale between 0-10; 0 meaning one does not consider that aspect relevant; 1, it has little importance, to 10, it is highly important. One can opt for a different weighting range of 0-5, 0-12 or even larger. A 0-10 range provides in most cases sufficient room to express differences in preference between different criteria.The total weight at each level is always 100%. If at a higher level, a factor A bears 50% of total weight and at a lower level of that factor A, an aspect B bears 50% of total factor A weight, then the relative weight of the B bears 50% x 50% = 25% of overall higher level weight. The relative weight of a specific component equals its weight at its particular level, multiplied by the weight that aspect has at a higher level in relation to other aspects.Even at lower levels, weighting can make sense. An indicator to justify the economic feasibility is for instance the Internal Rate of Return (IRR). It transpires that studies arrive at IRRs higher than 30%. This, in other words, indicates that there is a goldmine waiting to be explored; how could others not have seen this? Those responsible for the economics of the choice will have to decide if it is justifable to give such an IRR outcome a weight equal to other economic indicators.The two groups of examples show how the weighting of goals and objectives effects the ranking order of alternatives and the composition of a payment for performance structures.