MULTICRITERIA DECISION-MAKING WEIGHTS AND A COMPETITIVE PRODUCT DESIGN

The paper presents a general way of improving product features so that products were more competitive. The presented concept first represents the general standard of a product to be improved by a weighted average of the product feature levels, thus drawing on concepts from multicriteria decision-making theories. The paper then models the weights appearing in the average so that the average could be calculated, and the product could be improved, achieving at the same time that the modelled weights reflect a specific behaviour of the customer who is the ultimate judge of the product quality or standard. The reason for doing so is the fact that it is the customer who defines the weights which attach importance to each product feature. Since the behaviour of the customer is unknown, the weights are unknown, and must be modelled. If the weights are modelled in such a way that the resulting model reflects a specific customer behaviour, companies may refer to this model, when improving their products, provided there are reasons to believe that such a specific customer behaviour is occurring in the market. The approach to modelling the weights presented in the paper is compared to another approach for finding the weights, the alternative approach offering itself as a more natural way for these purposes. The paper shows, however, that the alternative approach lacks some desirable properties that the approach proposed in the paper is able to provide. The concepts presented in the paper are proved generally, using known mathematical optimization techniques, and the proved theory is accompanied by examples which support the validity of the general statements.