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Chapter 19: Decision Criteria - Making the Choice Defensible

Chapter 19: Decision Criteria - Making the Choice Defensible

Video: Decision Matrix Shows Judges Exactly How You Made Your Recommendation

Learning Objectives

By the end of this chapter, you should be able to:

  • develop decision criteria that reflect the case question and organisational priorities;

  • distinguish criteria from evidence, measures, and constraints;

  • identify criteria that meaningfully differentiate alternatives;

  • prioritise and weight criteria based on their relative importance;

  • create clear scoring scales supported by evidence;

  • use a decision matrix without creating false precision;

  • test whether a recommendation remains attractive when assumptions or weights change;

  • explain why the selected alternative wins and what trade-offs remain.

Why This Matters

Once your team has developed credible alternatives, it must choose. Without clear decision criteria, teams often select an alternative because:

  • it was the first idea proposed;

  • one team member strongly preferred it;

  • it sounded innovative;

  • it produced the highest projected revenue;

  • it was easiest to present;

  • it simply "felt like the best option."

That is not enough. Judges should be able to follow the logic of your decision:

  1. Here is the decision we needed to make.

  2. Here are the credible alternatives we considered.

  3. Here is what the chosen solution needed to accomplish.

  4. Here is the evidence we used to compare the alternatives.

  5. Here is why this alternative wins.

  6. Here are the risks and trade-offs we must still manage.

Decision criteria bridge alternatives and the recommendation; they make the choice transparent, disciplined, and defensible.

Discover Your MAD Skills Principle

If you cannot explain why your recommendation wins, you have not finished making the decision.

A recommendation should not win because the team likes it. It must win because it best satisfies the decision's requirements.

Start With the Decision

Before developing criteria, return to the decision statement created in the previous chapter: The decision we need to make is… For example: "How should the company enter the Western Canadian market while protecting profitability and limiting execution risk?" This statement already contains several possible criteria:

  • market-entry potential;

  • profitability;

  • implementation feasibility;

  • risk.

If the decision is unclear, the criteria will also be unclear. Compare these two questions:

  • "What should the company do?"

  • "Which market-entry approach will create the strongest long-term growth while remaining financially viable and executable with the company's current capabilities?"

The second question provides a much stronger foundation for evaluation.

From Case Requirements to Decision Criteria

Decision criteria should emerge from the case, not from a standard checklist. Look for criteria in:

  • the central case question;

  • the organisation's objectives;

  • the problem definition;

  • the needs of priority customers;

  • financial and operational constraints;

  • stakeholder expectations;

  • competitive conditions;

  • organisational capabilities;

  • implementation requirements;

  • material risks;

  • ethical, social, or environmental obligations.

A case involving a cash-constrained organisation may place greater importance on affordability and payback. A healthcare case may prioritise patient outcomes and regulatory compliance. A nonprofit case may emphasise mission impact and stakeholder reach. A turnaround case may value speed and immediate cash flow improvement over long-term growth. The criteria must reflect what success means in this case.

Criteria, Evidence, Measures, and Constraints

Teams frequently confuse four different elements.

  • Criterion
    • A criterion is a dimension used to compare alternatives. Examples:

      • financial attractiveness;

      • customer value;

      • strategic fit;

      • implementation feasibility;

      • stakeholder impact.

  • Evidence
    • Evidence supports the assessment of an alternative against a criterion. Examples:

      • projected cash flow;

      • customer survey results;

      • market growth data;

      • employee capability assessments;

      • competitor benchmarks.

  • Measure
    • A measure indicates how performance against the criterion will be assessed. Examples:

      • net present value;

      • customer adoption rate;

      • implementation time;

      • percentage of required capabilities already available;

      • number of stakeholders negatively affected.

  • Constraint
    • A constraint is a requirement an alternative must satisfy to remain viable. Examples:

      • investment cannot exceed $5 million;

      • implementation must begin within six months;

      • the solution must comply with privacy legislation;

      • service levels cannot fall below an established threshold.

This distinction matters. "Projected ROI of 18%" is not a criterion. It is evidence or a measure supporting the broader criterion of financial attractiveness.

Mandatory Requirements Before Weighted Criteria

Not every requirement should be traded off through scoring. Some conditions are non-negotiable. Eliminate alternatives before using the decision matrix that violate the law, exceed available capital, conflict with the organisation's mission, or cannot be implemented within the required period. A useful process is:

Step 1: Apply the non-negotiable screen

Ask whether each alternative:

  • complies with legal and regulatory requirements;

  • fits within absolute financial limits;

  • protects essential safety or ethical standards;

  • addresses the central problem;

  • remains consistent with the organisation's mission;

  • can be implemented within any mandatory deadline.

Step 2: Evaluate viable alternatives

Only alternatives that pass the non-negotiable screen should proceed to weighted comparison. This prevents an impossible or unacceptable option from appearing attractive simply because it scores well in other areas.

What Makes a Strong Criterion?

A strong decision criterion should be:

  • Relevant
    • It matters to the actual decision.
    • "Visual appeal" may matter in a packaging decision but probably not in a supplier restructuring decision.
  • Discriminating
    • It helps distinguish between alternatives.
    • If every alternative receives the same score, the criterion adds little to the decision.
  • Measurable
    • The team can evaluate it using quantitative evidence, qualitative evidence, or a clearly defined judgment.
    • Not everything important can be reduced to a financial number, but the basis for the assessment should still be clear.
  • Independent
    • It doesn't substantially duplicate another criterion.
    • For example, "profitability," "financial return," and "ROI" may measure much of the same thing. Including all three could unintentionally triple-count financial performance.
  • Directional
    • It is clear whether more or less is better.
      • For example:

      • higher customer value is better;

      • lower implementation risk is better;

      • faster time to impact is better.

  • Defensible
    • The team can explain why the criterion matters and why it has its level of priority.
The Criteria Test

For every proposed criterion, ask:

  1. Does it matter to the decision?

  2. Does it reflect the case objectives or constraints?

  3. Can it distinguish among the alternatives?

  4. Can we assess it using evidence?

  5. Does it overlap with another criterion?

  6. Could we explain its importance to a judge?

If a criterion fails these tests, remove, revise, or combine it.

Choosing the Right Number of Criteria

There is no perfect number, but most case decisions can be evaluated effectively using approximately four to six criteria. Too few criteria may oversimplify the decision. Too many can:

  • dilute the factors that matter most;

  • create overlap;

  • make the analysis difficult to explain;

  • hide the strategic choice inside unnecessary detail;

  • give the appearance of precision without improving judgment.

The goal is not to capture everything that could matter. It is to identify the few factors that should determine the choice.

Common Categories of Decision Criteria

Depending on the case, useful criteria may include:

  • Strategic fit: Does the alternative support the organisation's objectives and positioning?

  • Problem-solving impact: Does it address the root cause of the problem?

  • Customer value: Does it improve outcomes that matter to the priority customer?

  • Financial attractiveness: Does it create sufficient revenue, savings, profitability, or return?

  • Implementation feasibility: Can the organisation realistically execute it?

  • Capability fit: Does it use existing strengths, or can missing capabilities be acquired?

  • Speed to impact: How quickly can benefits be achieved?

  • Risk: How vulnerable is the alternative to failure or adverse outcomes?

  • Scalability: Can the alternative grow without disproportionate increases in cost or complexity?

  • Stakeholder impact: Will important stakeholders support or resist it?

  • Sustainability: Does it support long-term environmental, social, and economic performance?

  • Flexibility: Can the organisation adapt the strategy as new information becomes available?

  • Mission alignment: Does it advance the organisation's purpose and values?

These are possibilities, not a standard template. Select only those that matter to the decision.

Prioritising the Criteria

Not every criterion matters equally. In a turnaround case, immediate cash flow and implementation speed may be more important than scalability. In a market-entry case, strategic fit and market attractiveness may carry greater weight. In a public-sector case, stakeholder outcomes and feasibility may outweigh financial return. Before assigning numerical weights, ask:

  • Which criterion is essential to success?

  • Which criterion would most concern the client?

  • Which criterion best reflects the central objective?

  • Which failure would be most difficult to recover from?

  • Which criterion should influence the choice most strongly?

These questions establish the logic before the mathematics begins.

Using a Weighted Decision Matrix

A weighted decision matrix can help make the comparison transparent. A simple process is:

  1. Select the criteria.

  2. Assign each criterion a weight.

  3. Define the scoring scale.

  4. Score each alternative using evidence.

  5. Multiply each score by its weight.

  6. Compare the weighted totals.

  7. Interpret the results using judgment.

For example:

Criterion Weight
Strategic fit 25%
Financial attractiveness 25%
Customer value 20%
Implementation feasibility 15%
Risk and resilience 15%
Total 100%

The weights should reflect the case's priorities, not what is required to make the team's favourite alternative win.

Define the Scoring Scale Before Scoring

A score is meaningful only if the team agrees on what it represents. For a five-point scale:

Score Meaning
1 Performs very poorly or creates a major disadvantage
2 Performs below requirements
3 Meets minimum expectations
4 Performs strongly
5 Performs exceptionally well

Whenever possible, create evidence-based anchors for each criterion. For implementation speed, the scale might be:

Score Implementation period
1 More than 36 months
2 25–36 months
3 13–24 months
4 7–12 months
5 Six months or less

For financial attractiveness, the anchors might use:

  • expected return;

  • payback period;

  • net present value;

  • margin improvement;

  • required investment.

Anchored scales reduce arbitrary scoring and help different team members interpret the criteria consistently.

Evaluate With Evidence

A matrix should summarise reasoning, not replace it. Weak scoring sounds like: "We gave Option B a five for customer value because we thought customers would like it." Stronger scoring sounds like: "Option B received a five for customer value because it directly addresses the two highest-priority pain points identified in the case delivery reliability and ordering convenience and customer research indicates that these factors drive retention."

For every important score, the team should be able to answer:

  • What evidence supports this score?

  • What assumption did we make?

  • How confident are we?

  • What evidence might produce a different score?

Worked Example

Suppose a regional meal-kit company is deciding how to enter a new geographic market. It has developed three alternatives:

  1. Owned Organic Entry: Build its own distribution and customer-acquisition operation.

  2. Partnership-Led Pilot: Enter through an established regional grocery partner.

  3. Strengthen the Core First: Delay entry while improving operations and profitability in existing markets.

The team selects five criteria:

Criterion Weight Why It Matters
Strategic growth potential 25% The company needs a credible path to long-term expansion.
Financial attractiveness 25% Capital is limited, and the strategy must create sufficient return.
Speed to learning and impact 15% Management needs evidence of market demand quickly.
Implementation feasibility 20% The organisation has limited distribution capacity outside its current market.
Risk and flexibility 15% Demand and customer-acquisition costs remain uncertain.
Total 100%

Using a five-point scale, the team evaluates the alternatives:

Criterion Weight Owned Entry Partnership Pilot Strengthen Core
Strategic growth potential 25% 5 4 2
Financial attractiveness 25% 3 4 3
Speed to learning and impact 15% 2 5 3
Implementation feasibility 20% 2 4 5
Risk and flexibility 15% 2 5 4
Weighted score 100% 3.05 4.30 3.30

The partnership-led pilot wins not because it is strongest on every criterion, but because it provides the best overall balance. It:

  • creates meaningful access to the new market;

  • limits upfront investment;

  • uses the partner's existing infrastructure;

  • generates customer evidence quickly;

  • preserves the option to expand, revise, or withdraw.

The owned entry offers greater long-term control and growth potential but requires more capital and exposes the company to greater uncertainty. Strengthening the core is highly feasible but doesn't respond strongly enough to the growth opportunity. This explanation is more important than the number 4.30.

The Winner Doesn't Need to Win Every Criterion

A credible matrix will usually reveal trade-offs. If one alternative receives the highest score on every criterion, ask:

  1. Were the alternatives sufficiently different?

  2. Were the criteria selected fairly?

  3. Did the team exaggerate the preferred alternative's strengths?

  4. Did the team build weak alternatives to make the winner look better?

Test the Robustness of the Decision

A weighted score is only one version of the decision. Strong teams ask whether the winner remains attractive when the assumptions change.

Sensitivity Test

Change the most debatable weights or scores. Ask:

  1. What if financial return matters more?

  2. What if implementation risk is higher than expected?

  3. What if customer adoption is slower?

  4. What if speed becomes less important?

  5. What if the preferred alternative scores one point lower on a critical criterion?

If a minor adjustment changes the winner, the decision is sensitive and should be presented cautiously.

Dominance Test

Does one alternative perform as well as or better than another across nearly every important criterion? If so, the weaker alternative may not belong in the final choice set.

Regret Test

Ask: "If this alternative fails, what will we wish we had considered?" This can reveal overlooked risks or criteria.

Reversibility Test

Ask:

  • Can the decision be reversed?

  • Can it be piloted?

  • Can commitment be staged?

  • What will the organisation learn before making the next investment?

When two alternatives score similarly, the more flexible or reversible choice may be preferable under uncertainty.

Strategic Coherence Test

Even if an alternative scores well, does it form a coherent strategy? A collection of attractive features is not necessarily a strong strategic direction. The final choice must still fit the organisation, its capabilities, and its long-term position.

When Alternatives Score Closely

A narrow scoring difference doesn't mean the team should claim a decisive mathematical victory. If two options score similarly, the result may indicate:

  • the decision depends on a critical assumption;

  • additional information is required;

  • the criteria need refinement;

  • a pilot could reduce uncertainty;

  • one option should be sequenced before the other;

  • a hybrid may be appropriate.

For example: "The two leading alternatives perform similarly. The partnership pilot is therefore recommended as the first stage because it tests customer demand at lower cost. A fully owned entry will proceed only if adoption, retention, and unit-economics thresholds are achieved." The evaluation has now influenced implementation.

Decision Criteria Are Not the Recommendation

A decision matrix helps identify the strongest alternative. It doesn't complete the recommendation. The recommendation must still explain:

  • what the organisation should do;

  • why it should do it;

  • how it solves the problem;

  • why it is better than the alternatives;

  • what capabilities it requires;

  • how it will be implemented;

  • what it will cost;

  • what value it will create;

  • what risks must be managed;

  • what results will be measured.

Think of the matrix as evidence supporting the strategic argument, not as the argument itself.

Winning the Room

Don't present a dense spreadsheet and expect the judges to interpret it. A strong decision slide should show:

  • the three credible alternatives;

  • the three to five criteria that matter most;

  • the relative importance of those criteria;

  • the evidence supporting the major differences;

  • the winning alternative;

  • the decisive trade-off.

Your verbal explanation might sound like: "We evaluated three market-entry paths against five criteria derived from the case objectives. The partnership-led pilot wins because it provides the strongest balance of growth, financial return, implementation feasibility, and flexibility. Although an owned entry offers greater long-term control, it requires substantially more capital before demand has been validated. The pilot allows the company to learn before committing." The slide shows the comparison. Your explanation communicates the judgment.

Coach's Lens

A decision matrix is not a magic answer generator. It is a tool for exposing the team's reasoning. If your team changes the weights until the preferred alternative wins, you have not removed bias. You have hidden it behind numbers. I often ask teams: "What would have to be true for the second-place option to become the winner?" If they cannot answer, they may not understand their own decision. Strong teams know:

  • why the winner wins;

  • where it is vulnerable;

  • what assumptions could change the decision;

  • why the rejected alternatives were still credible;

  • what evidence must be monitored during implementation.

That is judgment, not simply scoring.

Common Mistakes

  • Generic Criteria: A "Good for the company" or "high impact" are too vague. Define what type of value or impact matters.
  • Criteria That Don't Match the Decision: A criterion may seem important but remain irrelevant to the specific choice.
  • Confusing Criteria With Evidence: "$5 million in revenue" is not a criterion. It is evidence supporting financial attractiveness or growth potential.
  • Double-Counting: Using profitability, financial return, ROI, and revenue growth as separate criteria may give financial performance excessive influence.
  • Too Many Criteria: A long matrix can obscure the few factors that should determine the decision.
  • Equal Weighting Without Thought: Equal weighting may be appropriate, but it should be a deliberate choice, not the default.
  • Undefined Scoring: A score of four is meaningless unless the team can explain what it represents.
  • Scoring Without Evidence: Numbers don't become objective simply because they appear in a table.
  • False Precision: A score of 4.27 versus 4.19 doesn't prove scientific certainty. The underlying judgments may be approximate.
  • Criteria Selected After the Decision: Criteria should help make the decision, not justify a favourite idea after it has already been selected.
  • Ignoring Non-Negotiables: An illegal, unaffordable, or mission-inconsistent option should not survive because it earns points elsewhere.
  • Weak Alternatives: A matrix cannot rescue a poor set of choices. If the alternatives are unrealistic or overlapping, the comparison will be weak.
  • Hiding Trade-Offs: Every serious option has disadvantages. Pretending otherwise reduces credibility.

MAD Skills Drill

Take the three alternatives developed in Chapter 18.

Part One: Establish the decision

Complete the sentence: The decision we need to make is…

Part Two: Identify non-negotiables

List any requirements that every viable alternative must satisfy.

Part Three: Develop the criteria

Generate six possible criteria. Test each one for:

  • relevance;

  • ability to discriminate;

  • measurability;

  • independence;

  • defensibility.

Reduce the list to the four or five that matter most.

Part Four: Prioritise

Assign weights totalling 100%. For each weight, explain why that criterion deserves its level of importance.

Part Five: Define the scale

Create a one-to-five scoring scale. Where possible, establish evidence-based anchors for each criterion.

Part Six: Evaluate

Score each alternative and identify the evidence supporting every major score.

Part Seven: Challenge the result

Ask:

  • What would need to change for the second-place alternative to win?

  • Which score contains the greatest uncertainty?

  • Does the winner remain strongest if the most important weight changes?

  • What trade-off does the winning option require?

  • Would we still choose it without the scoring table?

If the matrix produces a result that contradicts your judgment, don't automatically ignore either one. Investigate the disagreement.

Reflection Questions

  1. Did your criteria emerge from the case or from a standard list?

  2. Which criterion had the greatest influence on the choice?

  3. Did any criteria overlap?

  4. Which score relied most heavily on an assumption?

  5. How sensitive was the result to changes in weights or scores?

  6. What does the preferred alternative sacrifice?

  7. What evidence could cause you to change your recommendation?

  8. Can every team member explain why the recommendation wins?

Chapter Summary

Decision criteria transform: "We like this option." into: "This option best satisfies the requirements of the decision." A disciplined evaluation process moves through: Decision → Non-Negotiables → Criteria → Priorities → Evidence → Scoring → Robustness Test → Choice. The matrix makes the reasoning visible, but judgment remains essential. Strong teams don't simply announce the highest score. They explain why the winning alternative best addresses the problem, where it outperforms the other choices, what it sacrifices, and what assumptions could change the decision.

Key Takeaways

✓ Begin with a clearly defined decision.

✓ Derive criteria from the case question, organisational objectives, constraints, and stakeholder needs.

✓ Separate criteria from evidence, measures, and non-negotiable requirements.

✓ Select criteria that are relevant, discriminating, measurable, independent, and defensible.

✓ Prioritise the criteria that matter most rather than treating everything equally.

✓ Define scoring scales before evaluating the alternatives.

✓ Support important scores with evidence and make assumptions visible.

✓ Use weighted matrices to clarify judgment, not manufacture certainty.

✓ Test whether the winner remains attractive when weights, scores, or assumptions change.

✓ Acknowledge the weaknesses and trade-offs of the preferred alternative.

✓ Explain why the recommendation wins in words, not only with a number.

Looking Ahead

Selecting the strongest strategic alternative doesn't automatically make it worth pursuing. The recommendation must still pass a financial and quantitative test. The next chapter asks what the solution will cost, what value it will create, and whether the expected benefits justify the investment.

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