This page allows users to define the cost function the solver will use to optimize bids, set optimization goals and exclude bids from the evaluation.
By default, the primary cost function is used if no other cost function is applied. To select a secondary cost function, click the drop down arrow under 'Formula' and select the secondary cost function to be used. If no secondary cost formula as been set, you can click the 'secondary formula' text highlighted in blue which will re-direct to the design page where users can set the secondary formula (Fig 2 above).
Use this setting to determine whether the Sourcing Optimizer needs to solve a Lower values (minimization) or Higher values (maximization) problem. The default is 'Lower values are better' (minimize) (Fig 2). Solving for higher values may be desirable when optimizing on different criteria or using a secondary cost function.
For example, a user may configure a secondary cost function to calculate a quality score. In this case, the user may want optimize on the highest quality score, in which case, the user selects 'Higher values are better' in order to solve for the highest quality score per lot.
This feature can be used exclude outlier bids that may skew analysis. e.g. A bidder may have bid a price of $5 while another bidder may have bid with a price of $900,000 which may not be a realistic pricing for that bidding event. In this case, a user will set that values below $10 and above $800,000 will be excluded from the evaluation (Fig 3 above).