Relative-Aggregate-Scores Approach 15. The Superior Insurance Company has decide
ID: 1138563 • Letter: R
Question
Relative-Aggregate-Scores Approach 15. The Superior Insurance Company has decided to replace its outdated telephone voice mail system with a modern system. Sally Billings, vice-president of opera- tions, has narrowed the choices to two voice mail systems: Gamma and Omega The Gamma system is very basic and allows employees to retrieve their voice mail only from their offices. The Omega system is more technologically advanced, pro- viding more message options to callers and allowing employees to retrieve their voice mail from any touchtone telephone. The Omega system also provides remote paging capabilities. To help with the evaluation, Ms. Billings has had the follow- ing information prepared: Scores Factor Weight Gamma Omega Factors Economic factor: Annual operating cost 0.15 $30,000 $50,000 Other factors: Perceived quality of system System features Ease of use Message storage capacity Training requirements Implementation time Capital requirements 0.10 0.30 0.05 0.10 0.05 0.05 0.20 0.6 0.4 1.0 0.6 1.0 0.8 0.8 1.0 1.0 0.6 1.0 0.4 0.6 0.6 Note: A higher score isExplanation / Answer
Total score for Gamma:-
(0.15*30000+0.1*0.6+0.3*0.4+0.05*1+0.1*0.6+0.05*1+0.05*0.8+0.2*0.8)/(0.15+0.1+0.3+0.05+0.1+0.05+0.05+0.2)
=4500.54
Total score for Omega:-
(0.15*50000+0.1*1+0.3*1+0.05*0.6+0.1*1+0.05*0.4+0.05*0.6+0.2*0.6)/(0.15+0.1+0.3+0.05+0.1+0.05+0.05+0.2)
=7500.7
As the total score for omega is more than Gamma so Gamma should be selected.