Scoring methods

Scoring methods are used in investment appraisal. They have two primary purposes. Firstly they are useful where benefits are difficult to quantify objectively; secondly, they can be used to aggregate the results of multiple appraisal methods to provide an overall comparison.

The simplest form of scoring model is where a list of criteria is assessed in a binary way, i.e. they are either met or not.


Table of how two projects meet listed criteria


Click here for a worked example from Brook Bicycles' Columbus project.On this basis the scoring shown above seems to indicate that Project B should be preferred over Project A.

However, a more accurate picture is gained by scoring each factor according to how well it meets the criteria and weighting each factor according to its importance to the organisation.


Table of weighted numerical scores


This suggests that Project A is the preferred option.



Please consider allowing cookies to be able to share this page on social media sites.

Change cookie settings
27 June 2014Link to worked example from Brook Bicycles' Columbus project added.
Back to top