The default way of determing troop quality in Stargrunt is to simply pick it randomly for each squad. A better way is to base it on the scenario, though this requires effort and thought before hand.
The following is an attempt to provide a random determination of troop quality, based on the type of troops involved. It is also meant to provide some balance between large squads and small squads, by representing small squads as being elite units, and large squads as somewhat inferior.