Is there a "proper" formula for creating indices? I need to compute series of numbers into a KPI that can be tracked over time.
Example dataset is like this:
A B C D ----------------- 3 20 10000 ? 1 3 2000 ? 9 100 20000 ? 5 20 1000 ?
I need to come up with a formula to distill A, B, C to D which is an index that indicates which row has the highest "score" based on following rules:
- Column A - Lower the better - 3rd most important factor
- Column B - Higher the better - 2nd most important factor
- Column C - Higher the better - 1st most important factor
The problem I have is that how to come up with a proper weights in the formula so that it always follows the importance order.