Herron Company is screening three new product ideas: A, B, and C. Resource constraints allow only one of them to be commercialized. The performance criteria and ratings, on a scale of 1 (worst) to 10 (best), are shown in the following table. The Herron managers give equal weights to the performance criteria. Which is the best alternative, as indicated by the preference matrix method? Rating Performance Criterion Product A Product B Product C 1. Demand uncertainty and project risk 3 9 2 2. Similarity to present products 7 8 6 3. Expected return on investment (ROI) 10 4 8 4. Compatibility with current manufacturing process 4 7 6 5. Competitive advantage 4 6 5
Herron Company is screening three new product ideas: A, B, and C. Resource constraints allow only one of them to be commercialized. The performance criteria and ratings, on a scale of 1 (worst) to 10 (best), are shown in the following table. The Herron managers give equal weights to the performance criteria. Which is the best alternative, as indicated by the preference matrix method? Rating Performance Criterion Product A Product B Product C 1. Demand uncertainty and project risk 3 9 2 2. Similarity to present products 7 8 6 3. Expected return on investment (ROI) 10 4 8 4. Compatibility with current manufacturing process 4 7 6 5. Competitive advantage 4 6 5
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Herron Company is screening three new product ideas: A, B, and C. Resource constraints allow only one of them to be commercialized. The performance criteria and ratings, on a scale of 1 (worst) to 10 (best), are shown in the following table. The Herron managers give equal weights to the performance criteria. Which is the best alternative, as indicated by the preference matrix method?
| Rating | |||
| Performance Criterion | Product A | Product B | Product C |
| 1. Demand uncertainty and project risk | 3 | 9 | 2 |
| 2. Similarity to present products | 7 | 8 | 6 |
| 3. Expected |
10 | 4 | 8 |
| 4. Compatibility with current manufacturing process | 4 | 7 | 6 |
| 5. Competitive advantage | 4 | 6 | 5 |
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