Multi-criteria Analysis (Definition)

A technique applied to the appraisal of options (option appraisal), an initiative (investment appraisal), or to rank initiatives (portfolio prioritization). Designed in part to address the issue of unreliable financial forecasts. It is based on assigning weights to relevant financial and non-financial criteria, and then scoring options or initiatives in terms of how well they perform against these criteria. Weighted scores are then summed, and can be used to rank options/initiatives, including by means of a portfolio map or by dividing the total score by the cost of the option/initiative to calculate a score per £/$/€ invested*

Last Reviewed: 12 January 2018