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Using the Prioritization Engine in Bubble Chart Pro™

The Bubble Chart Pro™ SMART (Simple Multi Attribute Ranking Technique) Prioritization Engine automatically ranks your projects based on a value score calculated from the actual project data and weights that you assign to that data. The higher the weight, the more influence that attribute has on the Overall Value Score.

For a very simple example, if "Profit" is assigned a weight of "1000" and "Competitive Strength" is assigned a weight of "500," then "Profit" is going to have twice the influence on the value score as "Competitive Strength." If two projects have identical "Profit" values, than the project with the higher "Competitive Strength" value will have the higher Overall Value Score.

Bubble Chart Pro™ PLUS uses a rigorous value scoring system developed by researchers from Harvard, MIT, and the University of Southern California called SMART (Simple Multi-Attribute Rating Technique). The SMART system in Bubble Chart Pro™ PLUS uses weighted normalized value curves to compare projects. For example, in the value curve for "Profit" illustrated below, the relative "worst outcome" is the lowest profit value at "30" and the "best outcome" is the highest profit value of "160." Projects with profits of 160 would contribute 100 value points and projects with profits of 30 would contribute 0 value points to the Overall Value Score. Projects with Profit between 30 and 160 would have value scores calculated along the straight line between 0 and 100.

The Total Value Score is the sum of all the individual value scores multiplied by their normalized weights.

You can adjust your individual value score curves by using the slider on the Attribute form. Sliding it to the right creates an "Increasing Rate of Return" compared to the straight line "neutral" curve such that better projects have a proportionally higher rate of return than worse projects. For example, if the attribute were "profit," the increasing the rate of return would create a bias for higher profit projects in the "profit" value score.

Similarly, sliding it to the right creates a "Decreasing Rate of Return" compared to the straight line "neutral" curve such that better projects have a proportionally lower rate of return than worse projects. Adjusting for a decreasing rate of return is useful when small increases in the "better" projects are not a valuable as small increases in "worse" projects.

Essentially, here is how the Overall Value for each individual choice is calculated:

1. The individual value for each project"s attribute value is calculated according to the value curve illustrated above. These are the individual "normalized values."

2. The individual value values are adjusted in proportion to their relative weights or importance that you have assigned. These are the individual "normalized weighted values."

3. The normalized weighted values are summed together to yield the combined value or "Overall Value Score."

You can toggle between the actual attribute values and the normalized weighted values by clicking the [Calc.] and [Actual] button on the Portfolio Data Form.

1. Click [Calc.] to display the "normalized weighted values" in the attribute columns. Note that the values in the attribute columns sum to the number in the "Value Score" column:

You can view these values in your bubble charts by clicking on the "Use Weighted Value" check boxes in the new bubble chart form. See "Creating a Bubble Chart" for more details.

2. Click [Actual] to toggle back to display the actual values are displayed in the attribute columns.

Therefore, using the prioritization engine gives you an objective relative ranking of your projects based on the importance that you assign to the attributes by the weights. We recommend experimenting with different weighting models using a small group of projects to find a set that ranks those project the way you would. Then you can have more confidence in using those weights on a larger portfolio of projects.

Two important factors to keep in mind:

• Don"t weight two or more Attributes that basically describe the same thing, like "Profit" and "ROI" - in other words, don’t double-count! Only weight the attribute that best represents the value and will be the most influential.

• Don"t weigh too many attributes or you will dilute the effectiveness of the model. Four to seven weighted attributes will give you the best results.

Next: Tracking Uncertainty