Often we are presented with selecting a single choice from many alternatives. One of the ways to systematically accomplish this is by using Pareto Voting. So who is this guy Pareto and why should I vote for him? Wilfried Fritz Pareto was an Italian engineer, sociologist, economist, political scientist and, in his spare time, a philosopher who made several important contributions in the analysis of choices. Pareto Voting allows every member of a group an equal chance to participate in the decision process.
The rules are simple. Each member prioritizes the possible choices by assigning the highest number to their first choice. The scores are added and the results summarized. So let’s say that employees are asked to select the proposed website for their company from five alternatives. In this case, each would rate a five (5) for their highest, most preferred choice. A matrix would be prepared like that shown here:
On the left side of the matrix would be the employees numbered one through five. The actual names would be kept anonymous. The five website choices would be listed at the top of the matrix – here lettered Website A through E. The numerical values would be totaled for each website and the choice with the highest value, website D in this case, would be the choice.
Here are some possible uses of Pareto Voting:
- It could simply be used as is as a final decision tool
- Might be used to eliminate a large portion of choices, so other methods and / or resources could be devoted to the top choices.
- A good way to integrate the decision process with your social media program might be to have your customers vote on things like a choice for a new business name, or what product line to expand or add. Then the choice is totally democratic and can help drive traffic to your website or Facebook page.
So there are a few reason why you may want to consider voting for old Wilfried Pareto in the next election. In a future blog, we will discuss another decision tool – the Weighted Decision Matrix. See you then.
About the Author: Ron Miaso, one of the QuickBooks Yoopers, is a Certified QuickBooks ProAdvisor in Desktop and Online and before forming Delta Business Solutions was a Senior Finance Manager in the auto industry where he managed a $500 million annual operating budget and helped develop long range business plans.
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