What is AHP ?

 According to Operations Management 4th Edition by

Russell and Taylor III it is a quantitative method for
ranking decision alternatives and selection the one given
multiple criteria. AHP is a process for developing a
numerical score to rank each decision alternative based on
how well each alternative meets the decision maker’s
criteria.
What does it answer ?

 The question “Which one do we choose?” or “Which

one is best ?” by selecting the best alternative that
matches all of the decision maker’s criteria.
What does it use ?

 Simple mathematics
 criteria < set by the decision maker >

 preferences of that criteria < also set by the decision maker>

 the standard preference table
Standard Preference Table
PREFERENCE LEVEL NUMERICAL VALUE
Equally preferred 1
Equally to moderately preferred 2
Moderately preferred 3
Moderately to strongly preferred 4
Strongly preferred 5
Strongly to very strongly preferred 6
Very strongly preferred 7
Very strongly to extremely preferred 8
Extremely preferred
9
Why not make up your own
preference table ?

 Because the standard preference table has been

determined by experienced researchers in AHP to be a
reasonable basis for comparing two alternatives.
How is it used ?
 Say you have two criteria. Cost and quality for product A
& B. The cost for A= $60 and the quality is above
average. The cost for B=$15 and the quality is right at
average. Which do you choose? By making a matrix the
price of B is very strongly preferred to A and A is only
moderately preferred to B. The matrices of these
preferences would look like . . . .
Matrices of A and B
COST  Since price B is very
A B strongly preferred to the
A 1 1/7 price of A. The score of
B to A is 7 and A to B is
B 7 1
the reciprocal or inverse
of 1/7
QUALITY
A B
A 1 3

B 1/3 1
Our sample problem
Jilley Bean Co. is selecting a new location to
expand its operations. The company want to
use AHP to help it decide which location to
build its new plant. Jilley Bean Co. has four
criteria they will base their decision on these
are the following: property price, distance from
suppliers, the quality of the labor pool, and the
cost of labor. They have three locations to
decide from.
Matrices given criteria and
preferences
PRICE DISTANCE LABOR
A B C A B C A B C
A 1 3 2 A 1 6 1/3 A 1 1/3 1
B 1/3 1 1/5 B 1/6 1 1/9 B 3 1 7
C 1/2 5 1 C 3 9 1 C 1 1/7 1

WAGES  Showing that in preference in price

A B C A and C are the equally preferred but
A 1 1/3 1/2 are preferred over B.
B 3 1 4
C 2 1/4 1
How it is done ~ STEP ONE
PRICE
A B C
A 1 3 2
+ + +  First sum (add up) all
the values in each
B 1/3 1 1/5 column.
+ + +
C 1/2 5 1
= 11/6 9 16/5
How it is done ~ STEP TWO
PRICE
A B C
 Next the values
A 1/11/6 = 6/11 3/9 = 3/9 2/16/5 = 5/8
in each column are
+ + + divided by the
B 1/3/11/6 = 2/11 1/9 = 9 1/5/16/5 1/16 corresponding
+ + + column sums.
C 1/2/11/6 = 3/11 5/9 = 5/9 1/16/5 = 5/16
= 1 1 1

NOTICE: the values in each column sum to 1.

How it is done ~ STEP THREE
PRICE
A B C Row Average
A 6/11 ~.5455 + 3/9~.3333 + 5/8~ .6250 = 1.5038 /3 = .512
B 2/11~.1818 + 1/9~.1111 + 1/16~.0625 = .3544 /3 = .1185
C 3/11~.2727 + 5/9~.5556 + 5/16~.3803 = 1.2086 /3 = .3803
1.000

 Next convert fractions to decimals and find the

average of each row.
How it is done ~ STEP FOUR
Find the average for all the criterion by doing steps 1-3
on all the criteria. Arriving at the following

Location Price Distance Labor Wages

A .5012 .2819 .1790 .1561
B .1185 .0598 .6850 .6196
C .3803 .6583 .1360 .2243
How it is done ~ STEP FIVE
Rank the criteria in order of importance ~use the same method
used in ranking each criterion.

Criteria Price Distance Labor Wages

Price 1 1/5 3 4
Distance 5 1 9 7
Labor 1/3 1/9 1 2
Wages 1/4 1/7 1/2 1
How it is done ~ STEP 6-9
 Repeat steps 1-4 with the new matrices. You should arrive at the following :

Criteria Price Distance Labor Wage Row Average

Price .1519 .1375 .2222 .2857 .1933
Distance .7595 .6878 .6667 .5000 .6535
Labor .0506 .0764 .0741 .1429 .0860
Wage .0380 .0983 .0370 .0714 .0612

1.000
Row average= preference vector for
the criteria
CRITERIA
 Clearly the price
Price .1993
of the land is #2,
Distance .6535 follows distance to
suppliers, labor
Labor .0860
pool quality, and
Wage .0612 last cost of wages.
FINAL CALCULATIONS
Take the criteria matrix and multiple it by the preference vector

CRITERIA
Location Price Distance Labor Wages
Price .1993
A .5012 .2819 .1790 .1561
Distance .6535
B .1185 .0598 .6850 .6196
X
Labor .0860
C .3803 .6583 .1360 .2243
Wage .0612

Location A score = .1993(.0512) + .6535(.2819) + .0860(.1790) +.0621(.1561) = .3091

Location B score = .1993(.1185) + .6535(.0598) + .0860(.6850) + .0612(.6196) = .1595

Location C score = .1993(.3803) + .6535(.6583) + .0860(.1360) + .0612(.2243) = .5314

And the results are . . .
LOCATION Score

A .3091
B .1595
C .5314
1.0000

Based on the scored Location C should be chosen for Jilley

Bean Co. to built a plant.
How is AHP is used in real life ?
 Expert Choice a company that specializes in AHP
design software and performs services with it. Some of
their clientele are:
 Ford Motor Company
 Sprint PCS
 Department of Agriculture (USDA)
 Navy
 National Health Service of the United Kingdom
 Ferrari SpA in Italy
How is AHP is used in real life ?

 The USDA used it for the selection of bridge

materials across the nation in several states.
Is there anything AHP cannot
be used for ?

 Not really as long as the decision maker has set

criteria and set preferences of that criteria AHP can
be used.
Analytic Hierarchy Process
The Analytic Hierarchy Process (AHP)
 Founded by Saaty in 1980.
 It is a popular and widely used method for multi-
criteria decision making.
 Allows the use of qualitative, as well as quantitative
criteria in evaluation.
 Wide range of applications exists:
 Selecting a car for purchasing
 Deciding upon a place to visit for vacation
 Deciding upon an MBA program after graduation.

25
AHP-General Idea
 Develop an hierarchy of decision criteria and define the
alternative courses of actions.

 AHP algorithm is basically composed of two steps:

1. Determine the relative weights of the decision criteria
2. Determine the relative rankings (priorities) of alternatives

! Both qualitative and quantitative information can be

compared by using informed judgments to derive weights
and priorities.

26
 Example: Car Selection
 Objective
 Selecting a car
 Criteria
 Style, Reliability, Fuel-economy Cost?
 Alternatives
 Civic Coupe, Saturn Coupe, Ford Escort, Mazda Miata

27
 Hierarchy tree

Selecting
a New Car

Style Reliability Fuel Economy

Civic Saturn Escort Miata

Alternative courses of action

28
Ranking of Criteria and Alternatives
 Pairwise comparisons are made with the grades
ranging from 1-9.

 A basic, but very reasonable assumption for

comparing alternatives:
If attribute A is absolutely more important than attribute B
and is rated at 9, then B must be absolutely less important
than A and is graded as 1/9.

 These pairwise comparisons are carried out for all

factors to be considered, usually not more than 7,
and the matrix is completed.
29
Ranking Scale for Criteria and Alternatives

30
 Ranking of criteria

Style Reliability Fuel Economy

Style 1 1/2 3

Reliability 2 1 4

Fuel Economy 1/3 1/4 1

31
 Ranking of priorities
 Consider [Ax = maxx] where
 A is the comparison matrix of size n×n, for n criteria, also called the priority matrix.
 x is the Eigenvector of size n×1, also called the priority vector.
 max is the Eigenvalue, max  > n.

 To find the ranking of priorities, namely the Eigen Vector X:

1) Normalize the column entries by dividing each entry by the sum of the column.
2) Take the overall row averages.

Row
Normalized 0.30 0.29 0.38 0.30
1 0.5 3 Column Sums
averages
A= 2 1 4 0.60 0.57 0.50 0.60
X=
0.33 0.25 1.0 0.10 0.14 0.13 0.10
Priority vector
Column sums 3.33 1.75 8.00 1.00 1.00 1.00

32
 Criteria weights
 Style .30
 Reliability .60
 Fuel Economy .10

Selecting a New Car

1.00

Style Reliability Fuel Economy

0.30 0.60 0.10

33
Checking for Consistency
 The next stage is to calculate a Consistency Ratio (CR)
to measure how consistent the judgments have been
relative to large samples of purely random judgments.

 AHP evaluations are based on the aasumption that the

decision maker is rational, i.e., if A is preferred to B
and B is preferred to C, then A is preferred to C.

 If the CR is greater than 0.1 the judgments are

untrustworthy because they are too close for comfort
to randomness and the exercise is valueless or must be
repeated.

34
Calculation of Consistency Ratio
 The next stage is to calculate max so as to lead to the
Consistency Index and the Consistency Ratio.
 Consider [Ax = max x] where x is the Eigenvector.
A x Ax x

1 0.5 3 0.30 0.90 0.30

0.60 1.60 = max
0.60
2 1 4 =
0.10 0.35 0.10
0.333 0.25 1.0

λmax=average{0.90/0.30, 1.60/0.6, 0.35/0.10}=3.06

Consistency index , CI is found by

CI=(λmax-n)/(n-1)=(3.06-3)/(3-1)= 0.03

35
Consistency Ratio
 The final step is to calculate the Consistency Ratio, CR by using the
table below, derived from Saaty’s book. The upper row is the order
of the random matrix, and the lower row is the corresponding index
of consistency for random judgments.

Each of the numbers in this table is the average of CI’s derived from a
sample of randomly selected reciprocal matrices of AHP method.

An inconsistency of 10% or less implies that the adjustment is small as

compared to the actual values of the eigenvector entries.
A CR as high as, say, 90% would mean that the pairwise judgments are just
about random and are completely untrustworthy! In this case, comparisons
should be repeated.

In the above example: CR=CI/0.58=0.03/0.58=0.05

0.05<0.1, so the evaluations are consistent!

36
 Ranking alternatives
Style Priority vector
Civic Saturn Escort Miata
Civic 1 1/4 4 1/6 0.13
Saturn 4 1 4 1/4 0.24
Escort 1/4 1/4 1 1/5 0.07
Miata 6 4 5 1 0.56

Reliability Civic Saturn Escort Miata

Civic 1 2 5 1 0.38
Saturn 1/2 1 3 2 0.29
Escort 1/5 1/3 1 1/4 0.07
0.26
Miata 1 1/2 4 1

37
Ranking alternatives
Miles/gallon Normalized

Fuel Economy Civic 34 .30

Saturn 27 .24
Escort 24 .21
Miata 28 .25
113 1.0

! Since fuel economy is a quantitative measure, fuel consumption

ratios can be used to determine the relative ranking of alternatives;
however this is not obligatory. Pairwise comparisons may still be
used in some cases.

38
 Selecting a New Car
1.00

Style Reliability Fuel Economy

0.30 0.60 0.10

Civic 0.13 Civic 0.38 Civic 0.30

Saturn 0.24 Saturn 0.29 Saturn 0.24
Escort 0.07 Escort 0.07 Escort 0.21
Miata 0.56 Miata 0.26 Miata 0.25

39
Ranking of alternatives

Reliability

Economy
Style

Fuel
Civic .13 .38 .30 .30 .30
Saturn .24 .29 .24 .27
x
.60 =
Escort .07 .07 .21 .08
Miata .56 .26 .25 .10 .35

Priority matrix Criteria Weights

40
 Including Cost as a Decision
Criteria
Adding “cost” as a a new criterion is very difficult in AHP. A new column
and a new row will be added in the evaluation matrix. However, whole
evaluation should be repeated since addition of a new criterion might
affect the relative importance of other criteria as well!

Instead one may think of normalizing the costs directly and calculate the
cost/benefit ratio for comparing alternatives!

Normalized Cost/Benefits
Cost Benefits Ratio
Cost
 CIVIC $12K .22 .30 0.73
 SATURN $15K .28 .27 1.03
 ESCORT $9K .17 .08 2.13
 MIATA $18K .33 .35 0.92

41
Methods for including cost
criterion
 Use graphical representations to make trade-offs.

 Calculate cost/benefit ratios

 Use linear programming
 Use seperate benefit and cost trees and then combine the results

40 Miata
35 Civic
30
Benefit

25
20
Saturn
15 Escort
10
5
0
0 5 10 15 20 25 30 35

Cost

42
Complex decisions
•Many levels of criteria and sub-criteria exists for
complex problems.

43
AHP Software:
Professional commercial software Expert Choice
developed by Expert Choice Inc. is available which
simplifies the implementation of the AHP’s steps and
automates many of its computations

 computations
 sensitivity analysis
 graphs, tables

44
Ex 2: Evaluation of Job Offers

Ex: Peter is offered 4 jobs from Acme Manufacturing (A), Bankers Bank (B),
Creative Consulting (C), and Dynamic Decision Making (D).
He bases his evaluation on the criteria such as location, salary, job content,
and long-term prospects.

Step 1: Decide upon the relative importance of the selection criteria:

Location Salary Content Long-term

Location 1 1/5 1/3 1/2

Salary 5 1 2 4
Content 3 1/2 1 3
Long-term 2 1/2 1/3 1

45
Priority Vectors:
1) Normalize the column entries by dividing each entry by the sum of the column.
2) Take the overall row averages

Location Salary Content Long-term Average

Location 0.091 0.102 0.091 0.059 0.086

Salary 0.455 0.513 0.545 0.471 0.496
Content 0.273 0.256 0.273 0.353 0.289
Long-term 0.182 0.128 0.091 0.118 0.130
+ +
1 1 1 1 1

46
Example 2: Evaluation of Job Offers
Step 2: Evaluate alternatives w.r.t. each criteria

Location Scores Relative Location Scores

A B C D A B C D Avg.
A 1 1/2 1/3 5 A 0.161 0.137 0.171 0.227 0.174
B 2 1 1/2 7 B 0.322 0.275 0.257 0.312
C 3 2 1 9 C 0.484 0.549 0.514 0.409 0.293
D 1/5 1/7 1/9 1 D 0.032 0.040 0.057 0.045
0.489

0.044

47
Example 2: Calculation of Relative Scores
Relative
weights Relative scores
Relative Scores for Each Criteria for each for each
Location Salary Content Long-Term criteria alternative
A 0.174 0.050 0.210 0.510 0.086 0.164
B 0.293 0.444 0.038 0.012 x 0.496 = 0.256
C 0.489 0.312 0.354 0.290 0.289 0.335
D 0.044 0.194 0.398 0.188 0.130 0.238

48
More about AHP: Pros and Cons
• It allows multi criteria decision making.

• It is applicable when it is difficult to formulate

Pros

criteria evaluations, i.e., it allows qualitative

evaluation as well as quantitative evaluation.

• It is applicable for group decision making

environments

•There are hidden assumptions like consistency. Users should be trained to use
Repeating evaluations is cumbersome. AHP methodology.

•Difficult to use when the number of criteria or Use GDSS

Use constraints to eliminate
Cons

alternatives is high, i.e., more than 7.

some alternatives
Use cost/benefit ratio if
•Difficult to add a new criterion or alternative applicable

•Difficult to take out an existing criterion or

alternative, since the best alternative might
differ if the worst one is excluded.

49
Group Decision Making
The AHP allows group decision making, where group members can use their
experience, values and knowledge to break down a problem into a hierarchy
and solve. Doing so provides:

 Understand the conflicting ideas in the organization and try to reach a

consensus.
 Minimize dominance by a strong member of the group.
 Members of the group may vote for the criteria to form the AHP tree.
(Overall priorities are determined by the weighted averages of the
priorities obtained from members of the group.)

However;
The GDSS does not replace all the requirements for group decision making.
Open meetings with the involvement of all members are still an asset.

50
Example 3: AHP in project management
Prequalification Contractor A Contractor B Contractor C Contractor D Contractor E
of contractors 5 years experience 7 years experience 8 years experience 10 years experience 15 years experience
Experience
aims at the
Two similar projects One similar project No similar project Two similar projects No similar project
elimination of
incompetent Special procurement 1 international
experience project
contractors from
the bidding Financial $7 M assets $10 M assets $14 M assets $11 M assets $6 M assets
process. stability
High growth rate $5.5 M liabilities $6 M liabilities $4 M liabilities $1.5 M liabilities
Part of a group of Good relation with
No liability
companies banks
It is the choice of
Quality Good organization Average organization Good organization Good organization Bad organization
the decision performance
maker to C.M. personnel C.M. personnel C.M. team Good reputation Unethical techniques
eliminate Good reputation Two delayed projects Government award Many certi®cates
One project
terminated
contractor E Cost raised in some
from the AHP Many certi®cates Safety program Good reputation Average quality
projects
evalution since it Safety program QA/QC program
is not “feasible”
Manpower 150 labourers 100 labourers 120 labourers 90 labourers 40 labourers
at all !! resources
10 special skilled
200 by subcontract Good skilled labors 130 by subcontract 260 by subcontract
labourers
25 special skilled
Availability in peaks
labourers

51
Example 3 (cont.’d)
Contractor A Contractor B Contractor C Contractor D Contractor E
Equipment 4 mixer
4 mixer machines 6 mixer machines 1 batching plant 2 mixer machines
resources machines
2 concrete
1 excavator 1 excavator 1 excavator 10 others
transferring trucks
2000 sf steel
15 others 1 bulldozer 2 mixer machines 9 others
formwork
6000 sf wooden
20 others 1 excavator
formwork
15,000 sf steel
1 bulldozer
formwork
16 others
17,000 sf steel
formwork
Current works 1 big project 2 projects ending 1 medium project 2 big projects 2 small projects
load ending (1 big+ 1 medium) started ending started
3 projects ending
2 projects in mid (1 2 projects ending 1 medium
(2 small + 1
medium +1 small) (1 big + 1 medium) project in mid
medium)

52
Hierarchy Tree
Selecting the most
suitable contractor

Experience Financial Quality Manpower Equipment Current

Stability Performence Resources Resources workload

Contractor A Contractor B Contractor C Contractor D Contractor E

53
Example 3: AHP in project management
Step 1: Evaluation of the weights of the criteria

Step 2: a) Pairwise comparison matrix for experience

54
Example 3: AHP in project management
Calculation of priority vector:

x =

Probably Contractor-E should have been eliminated. It appears to be the worst.

Note that a DSS supports the decision maker, it can not replace him/her. Thus,
an AHP Based DSS should allow the decision maker to make sensitivity analysis of
his judgements on the overall priorities !

55
56
An Example with AHP
Choosing the most satisfied school
►Goal: To select the most satisfied school.
►Criteria: learning, friends, school life, vocational
training, college prep. and music classes.
►Alternatives: School A, school B, and school C.
Hierarchy:

Goal
Satisfaction with School

Learning Friends School Vocational College Music

Life Training Prep. Classes

School School School

A B C
Pairwise comparisons:
School Selection

L F SL VT CP MC Weights
Learning 1 4 3 1 3 4 .32

Friends 1/4 1 7 3 1/5 1 .14

School Life 1/3 1/7 1 1/5 1/5 1/6 .03

Vocational Trng. 1 1/3 5 1 1 1/3 .13

College Prep. 1/3 5 5 1 1 3 .24

Music Classes 1/4 1 6 3 1/3 1 .14

 Comparison of Schools with Respect
to the Six Characteristics
Learning Priorities Friends Priorities School Life Priorities
A B C A B C A B C
A 1 1/3 1/2 .16 A 1 1 1 .33 A 1 5 1 .45

B 3 1 3 .59 B 1 1 1 .33 B 1/5 1 1/5 .09

C 2 1/3 1 .25 C 1 1 1 .33 C 1 5 1 .46

Vocational Trng. Priorities College Prep. Priorities Music Classes Priorities

A B C A B C A B C
A 1 9 7 .77 A 1 1/2 1 .25 A 1 6 4 .69

B 1/9 1 1/5 .05 B 2 1 2 .50 B 1/6 1 1/3 .09

C 1/7 5 1 .17 C 1 1/2 1 .25 C 1/4 3 1 .22

 Composition and Synthesis
Impacts of School on Criteria

.32 .14 .03 .13 .24 .14 Composite

Impact of
L F SL VT CP MC
Schools

A .16 .33 .45 .77 .25 .69 .37

B .59 .33 .09 .05 .50 .09 .38

C .25 .33 .46 .17 .25 .22 .25

School A: .16*.32+.33*.14+.45*.03+.77*.13+.25*.24+.69*.14= .37

Overall final outcome
►School B is the best school with an overall priority of
0.38, followed by school A.
BWT PROBLEM -19.Bernard Mee, the head of the department of management science
at Tech, is evaluating faculty for raises at the end of the academic year. He is
considering three faculty members for raises: John Abbott, Megan Bates, and Debbie
Cook. Faculty evaluations are based on three criteria-teaching research, and service.
Professor Mee's pairwise comparisons for each of the three faculty members for each
criterion and his pairwise comparison matrix for the three criteria are as follows:
Determine an overall ranking of the three faculty members by using AHP.

Teaching Research
Faculty A B C Faculty A B C
Member Member
A 1 2 1/3 A 1 3 1/2
B 1/2 1 1/5 B 1/3 1 1
C 3 5 1 C 2 1 1

Service Criterion Teaching Research Service

Faculty A B C Teaching 1 3 5
Member
A 1 3 6 Research 1/3 1 2
B 1/3 1 2 Service 1/5 1/2 1
C 1/6 1/2 1 64
BWT – ANSWER 19:

Teaching Teaching
Faculty
A B C
Member Faculty ROW-
A B C
A 1,00 2,00 0,33 Member AVG
B 0,50 1,00 0,20
C 3,00 5,00 1,00 A 0,22 0,25 0,22 0,23
B 0,11 0,13 0,13 0,12
Column
4,50 8,00 1,53 C 0,67 0,63 0,65 0,65
Sum

Research Research
Faculty
A B C
Member Faculty ROW-
A 1,00 3,00 0,50 A B C
Member AVG
B 0,33 1,00 1,00
C 2,00 1,00 1,00 A 0,30 0,60 0,20 0,37
B 0,10 0,20 0,40 0,23
Column
3,33 5,00 2,50 C 0,60 0,20 0,40 0,40
Sum

65
 Service
Service
Faculty
A B C
Member Faculty ROW-
A B C
A 1,00 3,00 6,00 Member AVG
B 0,33 1,00 2,00
C 0,17 0,50 1,00 A 0,67 0,67 0,67 0,67
B 0,22 0,22 0,22 0,22
Column
1,50 4,50 9,00 C 0,11 0,11 0,11 0,11
Sum

Criterion Teaching Research Service ROW-

Criterion Teaching Research Service
AVG
Teaching 1,00 3,00 5,00
Research 0,33 1,00 2,00 Teaching 0,65 0,67 0,63 0,65
Service 0,20 0,50 1,00
Research 0,22 0,22 0,25 0,23
Column Service 0,13 0,11 0,13 0,12
1,53 4,50 8,00
Sum
66
 PR-
Teaching Research Service SCORE
VEC
0,23 0,37 0,67 0,65 0,31
0,12 0,23 0,22 0,23 0,16
0,65 0,40 0,11 0,12 0,53

C>A>B

67
BWT PROBLEM - 21. Megan Moppett is a sales representative for Technical Software Systems (TSS), and she
receives a commission for every new system installation she sells to a client. Her earnings during the Past
few years have been very high, and she wants to invest in a mutual fund. She is considering three funds: the
Temple Global Fund, the Alliance Blue Chip Fund, and the Madison Bond Fund. She has three criteria for
selection-potential return (based on historical trends and forecasts), risk, and the fund's load factor. Megan's
pairwise comparisons for the funds for each of their criteria and her pairwise comparison of the three
criteria are as follows: Determine the fund in which Megan should invest.
Potential Return Potential Return
Fon Global Blue Chip Bond Blue ROW-
Fon Global Bond
Global 1,00 0,25 2,00 Chip AVG
Blue Chip 4,00 1,00 6,00 Global 0,18 0,18 0,22 0,19
Bond 0,50 0,17 1,00 Blue
0,73 0,70 0,67 0,70
Chip
Column
5,50 1,42 9,00
Sum Bond 0,09 0,12 0,11 0,11

Risk Risk
Fon Global Blue Chip Bond Blue ROW-
Fon Global Bond
Global 1,00 2,00 0,33 Chip AVG
Blue Chip 0,50 1,00 0,20 Global 0,22 0,25 0,22 0,23
Bond 3,00 5,00 1,00
Blue Chip 0,11 0,13 0,13 0,12
Column
4,50 8,00 1,53 Bond 0,67 0,63 0,65 0,65
68
Sum
BWT – ANSWER 21:

Fund’s Load Fund’s Load

Fon Global Blue Chip Bond
Blue ROW-
Global 1,00 1,00 0,33 Fon Global Bond
Chip AVG
Blue Chip 1,00 1,00 0,33 Global 0,20 0,20 0,20 0,20
Bond 3,00 3,00 1,00
Blue
0,20 0,20 0,20 0,20
Chip
Column
5,00 5,00 1,67 Bond 0,60 0,60 0,60 0,60
Sum

Potential Fund’s
Kriter Risk Potential Fund’s ROW-
Return Load Kriter Risk
Return Load AVG
Getiri 1,00 3,00 5,00
Risk 0,33 1,00 2,00 Getiri 0,65 0,67 0,63 0,65
Yük 0,20 0,50 1,00
Risk 0,22 0,22 0,25 0,23
Column
1,53 4,50 8,00 Service 0,13 0,11 0,13 0,12
Sum

69
 Fund’s Priority
Return Risk SCORE
Load Vector
0,19 0,23 0,20 0,65 0,20
0,70 0,12 0,20 0,23 0,51
0,11 0,65 0,60 0,12 0,29

B>C>A

70
BWT PROBLEM - 23. Alex Wall is shopping for a new four-wheel-drive utility vehicle and has
dentified three models from which she will choose-an Explorer, a Tiooper, and a Passport. She
will make her selection based on Consumer Digest ratings, price, and each vehicle’s appearance.
Following are Alex’s pairwise comparisons for the vehicles for each ofher criteria and her criteria
preferences: Using AHP, determine which vehicle Alex should purchase..

Consumer Digest Rating Price

Vehicle Explorer Trooper Passport Vehicle Explorer Trooper Passport

Explorer 1 4 3 Explorer 1 1/4 1/6

Trooper 1/4 1 1/2 Trooper 4 1 2

Passport 1/3 2 1 Passport 6 1/2 1

Appearance
Criterion Consumer
Price Appearance
Vehicle Explorer Trooper Passport Digest Rating

Consumer
Explorer 1 4 3
Digest 1 2 4
Trooper 1/4 1 1/2 Rating
Price 1/2 1 3
Passport 1/3 2 1
Appearance 1/4 1/3 171
BWT – ANSWER 23

Consumer Digest Rating Consumer Digest Rating

Vehicle Explorer Trooper Passport
Explorer 1,00 4,00 3,00 ROW-
Vehicle Explorer Trooper Passport
Trooper 0,25 1,00 0,50 AVG
Passport 0,33 2,00 1,00 Explorer 0,63 0,57 0,67 0,62
Trooper 0,16 0,14 0,11 0,14
Column
1,58 7,00 4,50
Sum Passport 0,21 0,29 0,22 0,24

Fiyat Fiyat
Vehicle Explorer Trooper Passport
ROW-
Vehicle Explorer Trooper Passport
Explorer 1,00 0,25 0,17 AVG
Trooper 4,00 1,00 2,00 Explorer 0,09 0,14 0,05 0,10
Passport 6,00 0,50 1,00
Trooper 0,36 0,57 0,63 0,52
Column
Sum
11,00 1,75 3,17 Passport 0,55 0,29 0,32 0,38
72
 Appearance
Appearance
Vehicle Explorer Trooper Passport
ROW-
Vehicle Explorer Trooper Passport
Explorer 1,00 4,00 3,00 AVG

Trooper 0,25 1,00 0,50 Explorer 0,63 0,57 0,67 0,62

Passport 0,33 2,00 1,00
Trooper 0,16 0,14 0,11 0,14

Column Passport 0,21 0,29 0,22 0,24

1,58 7,00 4,50
Sum

Criteria CDR Price Appearance ROW-

Criteria CDR Price Appearance
AVG
CDR 1,00 2,00 4,00
Price 0,50 1,00 3,00 CDR 0,57 0,60 0,50 0,56

Appearance 0,25 0,33 1,00

Fiyat 0,29 0,30 0,38 0,32

Column Appearance 0,14 0,10 0,13 0,12

1,75 3,33 8,00 73
Sum
CDR Price Appearance Priority Vector SCORE

0,62 0,10 0,62 0,56 0,45

0,14 0,52 0,14 0,32 0,26

0,24 0,38 0,24 0,12 0,29

A>C>B

74
BWT PROBLEM - 25. Carol Latta is visiting hotels in Los Angeles to decide where to hold a
convention for a national organization of college business school teachers she represents. There
are three hotels from which to choose-the Cheraton, the Milton, and the Harriott. The criteria
she is to use to make her selection are ambiance, location (based on safety and walking distance
to attractions and restaurants), and cost to the organization. Following are the pairwise
comparisons she has developed that indicate her preference for each hotel for each criterion
and her pairwise comparisons for the criteria: Develop an overall ranking of the three hotels,
using AHP, to help Carol Latta decide where to hold the meeting.
Ambiance Location
Hotel Cheraton Milton Harriott Hotel Cheraton Milton Harriott

Cheraton 1 1/2 1/5 Cheraton 1 5 3

Milton 2 1 1/3 Milton 1/5 1 1/4
Harriott 5 3 1 Harriott 1/3 4 1

Cost Criterion Ambiance Location Cost

Hotel Cheraton Milton Harriott
Ambiance 1 2 4
Cheraton 2 2 5
Location 1/2 1 3
Milton 1/2 1 2
Harriott 1/5 1/2 1 Cost 1/4 1/3 751
BWT – ANSWER 25

Ambiance
Ambiance
Hotel Cheraton Milton Harriot
ROW-
Cheraton 1,00 0,50 0,20 Hotel Cheraton Milton Harriot
AVG
Milton 2,00 1,00 0,33
Cheraton 0,13 0,11 0,13 0,12
Harriot 5,00 3,00 1,00
Milton 0,25 0,22 0,22 0,23
Column
8,00 4,50 1,53 Harriot 0,63 0,67 0,65 0,65
Sum

Location Location
Hotel Cheraton Milton Harriot
ROW-
Hotel Cheraton Milton Harriot
Cheraton 1,00 5,00 3,00 AVG
Milton 0,20 1,00 0,25 Cheraton 0,65 0,50 0,71 0,62
Harriot 0,33 4,00 1,00
Milton 0,13 0,10 0,06 0,10
Column Harriot 0,22 0,40 0,24 0,28
1,53 10,00 4,25 76
Sum
 Cost Cost
Hotel Cheraton Milton Harriot
ROW-
Cheraton 1,00 2,00 5,00 Hotel Cheraton Milton Harriot
AVG
Milton 0,50 1,00 2,00 Cheraton 0,59 0,57 0,63 0,59
Harriot 0,20 0,50 1,00
Milton 0,29 0,29 0,25 0,28
Column
Sum
1,70 3,50 8,00 Harriot 0,12 0,14 0,13 0,13

Criteria Ambiance Location Cost ROW-

Criteria Ambiance Location Cost
AVG
Ambiance 1,00 2,00 4,00

Location 0,50 1,00 3,00 Ambiance 0,57 0,60 0,50 0,56

Cost 0,25 0,33 1,00

Location 0,29 0,30 0,38 0,32

Column Cost 0,14 0,10 0,13 0,12

Sum
1,75 3,33 8,00
77
Ambiance Location Cost Priority Vector SCORE
0,12 0,62 0,59 0,56 0,34
0,23 0,10 0,28 0,32 0,19
0,65 0,28 0,13 0,12 0,47

C>A>B

78
BWT PROBLEM - 31. Students at a university in Nottingham, England, are planning a summer
holiday to one of three European locations: Greece (G), Mallorca (M), or Ibiza (I). They are to
base their decision on three criteria-weather, cost, and potential fun (based on an Internet
survey of friends and acquaintances at other colleges). The students have developed the
following pairwise comparisons for each criterion and for the three criteria: If the students use
AHP to help make a decision, which location will they select for their summer holiday?

Weather Cost
Location G M I Location G M I
G 1 1/3 1/3 G 1 3 5
M 3 1 1 M 1/3 1 2
I 3 1 1 I 1/5 1/2 1

Fun Criterion Weather Cost Fun

Location G M I Weather 1 4 1/4
G 1 1/2 5
Cost 1/4 1 1/5
M 2 1 3
I 1/5 1/3 1 Fun 4 5 1

79
BWT – ANSWER 31

Weather Weather
Yer G M I
ROW-
G 1,00 0,33 0,33 Yer G M I
AVG
M 3,00 1,00 1,00
G 0,14 0,14 0,14 0,14
I 3,00 1,00 1,00
M 0,43 0,43 0,43 0,43
Column
7,00 2,33 2,33 I 0,43 0,43 0,43 0,43
Sum

Cost Cost

Yer G M I ROW-
Yer G M I
AVG
G 1,00 3,00 5,00 G 0,65 0,67 0,63 0,65
M 0,33 1,00 2,00 M 0,22 0,22 0,25 0,23
I 0,20 0,50 1,00 I 0,13 0,11 0,13 0,12

80
 Fun Fun
Yer G M I
ROW-
G 1,00 0,50 5,00 Yer G M I
AVG
M 2,00 1,00 3,00 G 0,31 0,27 0,56 0,38
I 0,20 0,33 1,00
M 0,63 0,55 0,33 0,50
Column
3,20 1,83 9,00 I 0,06 0,18 0,11 0,12
Sum

Criteria Weather Cost Fun ROW-

Criteria Weather Cost Fun
AVG
Weather 1,00 4,00 0,25
Cost 0,25 1,00 0,20 Weather 0,19 0,40 0,17 0,25
Fun 4,00 5,00 1,00
Cost 0,05 0,10 0,14 0,10

Column Fun 0,76 0,50 0,69 0,65

5,25 10,00 1,45
Sum

81
Weather Cost Fun Priority Vector SCORE

0,14 0,65 0,38 0,25 0,35

0,43 0,23 0,50 0,10 0,46
0,43 0,12 0,12 0,65 0,20

B>A>C

82
BWT PROBLEM - 33. The management science and information technology majors at Tech
select one of two available options within the major-decision support systems (DSS) or
operations management (OM). Student advisers use AHP with the students to determine which
option they should select. The criteria used by the advisers are student aptitude and interests,
faculty who teach in the options, and potential job availability. An adviser has helped one major
develop the following pairwise comparisons: Which option should the student select?

Aptitude Faculty
Option DSS OM Option DSS OM
DSS 1 3 DSS 1 1/5
OM 1/3 1 OM 5 1

Jobs Criterion Aptitude Faculty Jobs

Option DSS OM Aptitude 1 1/2 1/4

DSS 1 4 Faculty 2 1 1/3

OM 1/4 1 Jobs 4 3 1

83
BWT – ANSWER 33

Aptitude Aptitude
Option DSS OM
ROW-
DSS 1,00 3,00 Option DSS OM
AVG
OM 0,33 1,00
DSS 0,75 0,75 0,75
Column
1,33 4,00 OM 0,25 0,25 0,25
Sum

Faculty
Faculty
Option DSS OM
ROW-
DSS 1,00 0,20 Option DSS OM
AVG
OM 5,00 1,00
DSS 0,17 0,17 0,17

Column OM 0,83 0,83 0,83

6,00 1,20
Sum
84
 Jobs
Jobs
Seçenek DSS OM
ROW-
DSS 1,00 4,00 Seçenek DSS OM
AVG
OM 0,25 1,00
DSS 0,80 0,80 0,80

Column OM 0,20 0,20 0,20

1,25 5,00
Sum

Criteria Aptitude Faculty Jobs ROW-

Criteria Aptitude Faculty Jobs
AVG
Aptitude 1,00 0,50 0,25
Aptitude 0,14 0,11 0,16 0,14
Faculty 2,00 1,00 0,33

Jobs 4,00 3,00 1,00 Faculty 0,29 0,22 0,21 0,24

Column
7,00 4,50 1,58 Jobs 0,57 0,67 0,63 0,62
Sum
85
 Priority
Aptitude Faculty Jobs SCORE
Vector
0,75 0,17 0,80 0,14 0,64

0,25 0,83 0,20 0,24 0,36

0,62
A>B

86
BWT PROBLEM - 35. The town of Blacksburg needs a larger modern middle
school. The current middle school is in the center of town and is over 40 years
old. There are two proposals for a new school-renovate and expand the current
facility and keep it in town or build a new school on the outskirts of town.
Different groups in town have strong feelings about the proposals. Some
citizens want to retain the sense of tradition of the old school and like it in town,
where it helps engender a sense of community. Others view the old school as
antiquated and beyond saving and believe keeping the school in town near
bars, traffic, and college students to be negative. The county school board will
make the final decision. The school board has asked several management
science professors from the local college to use AHP to help evaluate the
proposals. The school board has identified four groups from which it wants to
solicit input regarding their preferences: the middle school PTA, the middle
school teachers, current and former middle school students, and the town
council. The management science professors have developed the following
pairwise comparison matrices for each of these groups:
The school board's pairwise comparison of the four groups from which it is
soliciting preferences is as follows:
a) Based on the AHp analysis conducted by the management science
professors, proposal should the school board select?
b) Check the school board's pairwise comparison of the criteria for consistency.
87
 PTA Teachers

Proposal Renovate New Proposal Renovate New

Renovate 1 1/3 Renovate 1 1/9
New 3 1 New 9 1

Students Town council

Proposal Renovate New Proposal Renovate New

Renovate 1 2 Renovate 1 5

New 1/2 1 New 1/5 1

Group PTA Teachers Students Town

council
PTA 1 5 2 1/4
Teachers 1/5 1 1/4 1/7
Students 1/2 4 1 1/5
Town 4 7 5 1
council 88
BWT – ANSWER 35

PTA
PTA
Proposal Genişlet Yeni
ROW-
Genişlet 1,00 0,33 Proposal Genişlet Yeni
AVG
Yeni 3,00 1,00
Genişlet 0,25 0,25 0,25

Column Sum 4,00 1,33 Yeni 0,75 0,75 0,75

Teachers Teachers
Proposal Genişlet Yeni
ROW-
Proposal Genişlet Yeni
Genişlet 1,00 0,11 AVG

Yeni 9,00 1,00 Genişlet 0,10 0,10 0,10

Yeni 0,90 0,90 0,90

Column Sum 10,00 1,11 89
 Students Students
Proposal Genişlet Yeni
ROW-
Proposal Genişlet Yeni
Genişlet 1,00 2,00 AVG
Yeni 0,50 1,00 Genişlet 0,67 0,67 0,67

Column Sum 1,50 3,00 Yeni 0,33 0,33 0,33

Town council Town council

Proposal Genişlet Yeni
ROW-
Proposal Genişlet Yeni
Genişlet 1,00 5,00 AVG

Yeni 0,20 1,00 Genişlet 0,83 0,83 0,83

Yeni 0,17 0,17 0,17

Column Sum 1,20 6,00

90
 Town Town ROW-
Criteria PTA Teachers Students
council Criteria PTA Teachers Students
council AVG
PTA 1,00 5,00 2,00 0,25 PTA 0,18 0,29 0,24 0,16 0,22
Teachers 0,20 1,00 0,25 0,14
Teachers 0,04 0,06 0,03 0,09 0,05
Students 0,50 4,00 1,00 0,20
Town
Students 0,09 0,24 0,12 0,13 0,14
council
4,00 7,00 5,00 1,00
Town
0,70 0,41 0,61 0,63 0,59
Column Sum 5,70 17,00 8,25 1,59 council

Town
PTA Teachers Students Priority Vector SCORE
council
0,25 0,10 0,67 0,83 0,22 0,65
0,75 0,90 0,33 0,17 0,05 0,36
0,14
0,59 A>B

91
BWT PROBLEM – 37 .Federated Health Care has contracted to be Tech's primary
health care provider for faculty and staff. There are three major hospitals in the area
(within 35 miles)-County, Memorial, and General-that have full-service emergency
rooms. Federated wants to designate one of the hospitals as its primary care
emergency room for İts members. The company's criteria for selection are quality of
medical care, as determined by a patient survey; distance to the emergency room by
the majority of is members; speed of medical attention at the emergency room; and
cost. Following are thee pairwise comparisons of the emergency rooms for each of the
four criteria and the pairwise comparisons for the criteria:
Using AHP, determine which hospital emergency room Federated Health Care should
designate as İts primary care provider.
Medical care Distance

Hospital County Memorial General Hospital County Memorial General

County 1 1/6 1/3 County 1 7 4

Memorial 6 1 3 Memorial 1/7 1 2

General 3 1/3 1 General 1/4 1/2 1

92
 Speed of Attention Cost

Hospital County Memorial General Hospital County Memorial General

County 1 1/2 3 County 1 6 4

Memorial 2 1 4 Memorial 1/6 1 1/2

General 1/3 1/4 1 General 1/4 2 1

Criterion Medical Distance Speed of Cost

care Attention
Medical 1 8 6 3
care
Distance 1/8 1 1/2 1/6
Speed of 1/6 2 1 1/4
Attention
Cost 1/3 6 4 1

93
BWT – ANSWER 37

Medical care
Medical care
Hospital County Memorial General
ROW-
County 1,00 0,17 0,33 Hospital County Memorial General
AVG
Memorial 6,00 1,00 3,00
County 0,10 0,11 0,08 0,10
General 3,00 0,33 1,00
Memorial 0,60 0,67 0,69 0,65
Column
10,00 1,50 4,33 General 0,30 0,22 0,23 0,25
Sum

Distance Distance
Hospital County Memorial General
ROW-
Hospital County Memorial General
County 1,00 7,00 4,00 AVG

Memorial 0,14 1,00 2,00 County 0,72 0,82 0,57 0,70

General 0,25 0,50 1,00
Memorial 0,10 0,12 0,29 0,17

Column
1,39 8,50 7,00 General 0,18 0,06 0,14 0,13
94
Sum
 Speed of Attention Speed of Attention

Hospital County Memorial General

ROW-
Hospital County Memorial General
County 1,00 0,50 3,00 AVG

Memorial 2,00 1,00 4,00 County 0,30 0,29 0,38 0,32

General 0,33 0,25 1,00

Memorial 0,60 0,57 0,50 0,56

Column General 0,10 0,14 0,13 0,12

3,33 1,75 8,00
Sum

Cost Cost
Hospital County Memorial General
ROW-
Hospital County Memorial General
County 1,00 6,00 4,00 AVG

Memorial 0,17 1,00 0,50 County 0,70 0,67 0,73 0,70

General 0,25 2,00 1,00
Memorial 0,12 0,11 0,09 0,11

Column General 0,18 0,22 0,18 0,19

1,42 9,00 5,50 95
Sum
 Medical Speed of Medical Speed of ROW-
Criteria Distance Cost Criteria Distance Cost
care Attention care Attention AVG
Medical Medical
care
1,00 8,00 6,00 3,00 care
0,61 0,47 0,52 0,68 0,57
Distance 0,13 1,00 0,50 0,17 Distance 0,08 0,06 0,04 0,04 0,05
Speed of
Attention
0,17 2,00 1,00 0,25 Speed of
Attention
0,10 0,12 0,09 0,06 0,09
Cost 0,33 6,00 4,00 1,00
Column Maliyet 0,20 0,35 0,35 0,23 0,28
Sum
1,63 17,00 11,50 4,42

Medical Speed of
Distance Cost Priority Vector SCORE
care Attention
0,10 0,70 0,32 0,70 0,57 0,31
0,65 0,17 0,56 0,11 0,05 0,46
0,25 0,13 0,12 0,19 0,09 0,21
0,28
B>A>C

96
BWT PROBLEM – 39. A faculty committee in the department of management science at Tech is
evaluating three new text-books for its introductory management science course, which all
business students are required to take. The texts, identified by the authors, are Adams/Jones,
Barnes, and Cook/Smith. The committee's selection criteria are topical coverage, readability,
cost, and the available supplements. Following are the committee's pairwise comparisons of the
three textbooks for each of the four criteria and the committee's pairwise comparisons for the
criteria:

Using AHP, determine which textbook the committee should select. Check the consistency of the
pairwise comparison matrix fort he criteria.

Coverage Readability

Textbook A B C Textbook A B C

A 1 1/5 1/4 A 1 2 3

B 5 1 3 B 1/2 1 3

C 4 1/3 1 C 1/3 1/3 1

97
 Cost Supplements
Textbook A B C Textbook A B C

A 1 1/2 1/5 A 1 4 7

B 2 1 1/3 B 1/4 1 3

C 5 3 1 C 1/7 1/3 1

Criterion Coverage Readability Cost Supplements

Coverage 1 1/2 1/4 2

Readability 2 1 1/3 5
Cost 4 3 1 3
Supplements 1/2 1/5 1/3 1

98
BWT – ANSWER 39

99