Contract Compliance

Understanding Weightage in the Likert Method: A Guide with Practical Example

When evaluating suppliers or vendors, decision-makers often rely on structured methods to ensure objective and comprehensive assessments. One such technique is the Likert Method, which helps quantify subjective judgments through scaled rankings. However, a common question arises: how are the actual weightages assigned to different criteria? In this article, we’ll explore this process in detail, using a practical example for clarity.

What Is the Likert Method?

The Likert Method involves gathering opinions or preferences from stakeholders and translating those into quantifiable scores. Typically, this involves two steps:

1. Initial ranking of criteria based on overall importance.
2. Assessment of each criterion’s importance level among stakeholders.

Let’s illustrate this with a real-world scenario.

Scenario Example

Suppose you are evaluating six departments within an organization, each contributing insights to criteria for supplier selection:

• Each department selects four criteria relevant to their needs, leading to a total of 24 criteria.
• These 24 criteria are then grouped and consolidated into a final list of 10 distinct criteria.
• Each criterion is rated on a Likert scale:
• Not important
• Slightly Important
• Important
• Very Important

Stakeholder Input

The same six stakeholders (representing the departments) review the consolidated list. They rank each criterion based on its importance, for example:

| Criterion | Responses (Number of Stakeholders) |
|—|—|
| Criterion 1 | 5 say “Very Important”, 1 says “Slightly Important” |
| Criterion 2 | 4 say “Important”, 2 say “Not Important” |
| … | … |

Question: How Do You Calculate the Final Weightage?

Understanding Weight Calculation

The goal is to determine a numerical weight or importance score for each criterion, reflecting the collective opinion. The process involves:

1. Assigning numerical values to importance levels:
2. Not Important = 1
3. Slightly Important = 2
4. Important = 3

5. Very Important = 4

6. Calculating a weighted score based on stakeholder responses:

For Criterion 1:
– 5 stakeholders say it’s “Very Important” (score = 4)
– 1 stakeholder says it’s “Slightly Important” (score = 2)

The total score for Criterion 1 is:

(Number of