Assume a simple specification with a number of non-financial (ie technical, qualitative, environmental and social) criteria and a single purchase price. It is considered that the non-financial criteria of the submissions are four times as important as the price to be paid. Therefore, the weighting of non-financial : price is 4:1 or 0.8:0.2.
Four submissions have been received and each evaluated. The score allocated were as follows:
Non-Financial Evaluation Firm A Firm B Firm C Firm D
Total score 123 126 129 117
Relative Non-Financial score 95.35 97.67 100.00 90.70
Financial – price £10,500 £10,350 £11,750 £9,900
Relative Financial score 94.29 95.65 84.26 100.00
Composite calculation
Non-Financial score (*0.8) 76.28 78.14 80.00 72.56
Financial (price) score (*0.2) 18.86 19.13 16.85 20.00
Final score 95.14 97.27 96.85 92.56
Comments:
- The highest score (Firm C) is allocated 100 points and the others given a relative score using the formula [firm’s score/highest score] x 100 eg Firm A is [123/129] x 100 = 95.35.
- The lowest price, Firm D, is allocated 100 points and the others given a relative score using a different formula [Lowest price/Lowest price] x 100 eg Firm A is [9900/10500] x 100 = 94.28.
- The scores are then adjusted using the set weightings for technical and price ie 80:20. So, again for Firm A, the technical score is adjusted to [95.35 x 0.8] = 76.27 and price score to [94.29 x 0.2] = 18.86. These are then added together, giving an overall score of 95.13.
- The highest overall score was 97.46 for Firm B and the recommendation would be to award the contract to Firm B.
Other assessment methodology used is similar to this simple example, except that it often uses more weighted dimensions e.g. - financial, technical quality and environmental and social – rather than the two used here – non-financial and price. Further, within each of the dimensions, individual criteria may also be weighted.