Sensitivity analysis of bid evaluation plans for defence acquisition problems

This paper presents a simulation-based method for performing high dimensional sensitivity analysis in multi-criteria decision making problems. The method integrates multi-criteria decision analysis, Monte Carlo simulation, and optimization techniques to assess the sensitivity of criteria weights and performance values of alternatives. It determines a ranking probability matrix by simulating stochastic input parameters and calculates the most probable rankings of alternatives using an assignment algorithm. The method was developed to assess the robustness of bid evaluation plans for defence acquisition problems. It would allow decision makers to better understand the impact of uncertainty in criteria weights on bid performance and to further refine bid evaluation plans. An illustrative example using a military aircraft acquisition scenario was presented and discussed.