Professional Documents
Culture Documents
AHP-General Idea
Objective
Criteria
Selecting a car
Style, Reliability, Fuel-economy
Cost?
Alternatives
Hierarchy tree
S e le c t in g
a N ew C ar
S t y le
Civic
R e lia b ilit y
Saturn
FuelE conom y
Escort
Miata
Ranking of criteria
Style
Reliability
Fuel Economy
Style
1/2
Reliability
1/3
1/4
Fuel Economy
Ranking of priorities
A is the comparison matrix of size nn, for n criteria, also called the priority matrix.
x is the Eigenvector of size n1, also called the priority vector.
maxis the Eigenvalue, max > n.
1) Normalize the column entries by dividing each entry by the sum of the column.
2) Take the overall row averages.
A=
1
0.5 3
2
1
4
0.33 0.25 1.0
8.00
Normalized
Column Sums
0.30
0.60
0.10
0.29
0.57
0.14
0.38
0.50
0.13
1.00
1.00
1.00
Row
averages
X=
0.30
0.60
0.10
Priority vector
Criteria weights
Style
.30
Reliability
.60
Fuel Economy .10
Selecting a New Car
1.00
Style
0.30
Reliability
0.60
Fuel Economy
0.10
10
Calculation of Consistency
The next stage is to calculate so as to lead to the
Ratio
max
1
0.5
2
1
0.333 0.25
3
4
1.0
Ax
0.30
0.60
0.10
0.90
1.60
0.35
0.30
0.60
0.10
= max
index , CI is found by
CI=(max-n)/(n-1)=(3.06-3)/(3-1)= 0.03
12
Consistency Ratio
Each of the numbers in this table is the average of CIs 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!
13
Ranking alternatives
Style
Civic
Civic
1
Saturn
Escort
Miata
4
1/4
6
Reliability Civic
Civic
1
Saturn
Escort
Miata
1/2
1/5
1
Saturn
1/4
1
1/4
4
Saturn
2
1
1/3
1/2
Escort Miata
4
1/6
4
1
5
1/4
1/5
1
Escort Miata
5
1
3
1
4
2
1/4
1
Priority vector
0.13
0.24
0.07
0.56
0.38
0.29
0.07
0.26
14
Ranking alternatives
Fuel Economy
Miles/gallon
Normalized
Civic
34
.30
Saturn
Escort
Miata
27
24
28
.24
.21
.25
1.0
113
! 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.
15
Style
0.30
Civic
Saturn
Escort
Miata
Reliability
0.60
0.13
0.24
0.07
0.56
Civic
Saturn
Escort
Miata
0.38
0.29
0.07
0.26
Fuel Economy
0.10
Civic
0.30
Saturn 0.24
Escort 0.21
Miata 0.25
16
Ranking of alternatives
Civic
.13
.38 .30
Saturn
Escort
Miata
.24
.07
.29 .24
.07 .21
.56
.26 .25
Priority matrix
.30
x
.60
.10
.30
.27
=
.08
.35
Criteria Weights
17
CIVIC
SATURN
ESCORT
MIATA
Cost
Normalized
Cost
Benefits
Cost/Benefits
Ratio
$12K
$15K
$9K
$18K
.22
.28
.17
.33
.30
.27
.08
.35
0.73
1.03
2.13
0.92
18
Civic
Miata
Saturn
Escort
19
Complex decisions
Many levels of criteria and sub-criteria exists for
complex problems.
20
AHP Software:
Professional commercial software Expert Choice
developed by Expert Choice Inc. is available which
simplifies the implementation of the AHPs steps and
automates many of its computations
computations
sensitivity analysis
graphs, tables
21
Location
1/5
1/3
1/2
Salary
Content
5
3
1
1/2
2
1
4
3
Long-term
1/2
1/3
1
22
Priority Vectors:
1) Normalize the column entries by dividing each entry by the sum of the column.
2) Take the overall row averages
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
23
A
B
C
D
1
2
3
1/5
1/2
1
2
1/7
1/3
1/2
1
1/9
5
7
9
1
A
A
B
C
D
0.161
0.322
0.484
0.032
B
0.137
0.275
0.549
0.040
0.171
0.257
0.514
0.057
0.227
0.312
0.409
0.045
Avg.
0.174
0.293
0.489
0.044
24
Example 2: Calculation of
Relative Scores
Relative
weights
for each
criteria
A
B
C
D
0.174
0.293
0.489
0.044
0.050
0.444
0.312
0.194
0.210
0.038
0.354
0.398
0.510
0.012
0.290
0.188
0.086
0.496
0.289
0.130
Relative scores
for each
alternative
=
0.164
0.256
0.335
0.238
25
Cons
Use GDSS
Use constraints to eliminate
some alternatives
Use cost/benefit ratio if
applicable
26
27
Prequalification
of contractors
aims at the
elimination of
incompetent
contractors from
the bidding
process.
Contractor A
Experience
Contractor C
Contractor D
Contractor E
15 years experience
No similar project
No similar project
Financial
stability
$7 M assets
$10 M assets
$14 M assets
$11 M assets
$6 M assets
$5.5 M liabilities
Part of a group of
companies
$6 M liabilities
$4 M liabilities
Good relation with
banks
$1.5 M liabilities
No liability
It is the choice
of the decision
maker to
eliminate
contractor E
from the AHP
evalution since it
is not feasible
at all !!
Contractor B
Quality
Good organization Average organization Good organization Good organization
performance
C.M. personnel
C.M. personnel
Good reputation
Many certicates
Safety program
Safety program
Manpower
resources
C.M. team
Good reputation
Good reputation
Bad organization
Unethical techniques
One project
terminated
Average quality
90 labourers
40 labourers
QA/QC program
150 labourers
100 labourers
120 labourers
10 special skilled
labourers
200 by subcontract
Availability in peaks
25 special skilled
labourers
260 by subcontract
28
Example 3 (cont.d)
Contractor A
Equipment
resources
Contractor B
Contractor C
Contractor D
4 mixer
machines
1 excavator
1 excavator
2 concrete
1 excavator
transferring trucks
15 others
1 bulldozer
20 others
1 excavator
15,000 sf steel
formwork
1 bulldozer
16 others
17,000 sf steel
formwork
2 projects ending 1 medium project
(1 big+ 1 medium) started
2 big projects
ending
Contractor E
2 mixer machines
10 others
2000 sf steel
formwork
6000 sf wooden
formwork
2 small projects
started
3 projects ending
(2 small + 1
medium)
29
Hierarchy Tree
Selecting the most
suitable contractor
Experience
Contractor A
Financial
Stability
Quality
Performence
Contractor B
Manpower
Resources
Contractor C
Equipment
Resources
Contractor D
Current
workload
Contractor E
30
31
32
33
Units: Cost ($ 1,000), Target (10,000 people), Duration (days), Efficiency (0-100)
Manpower (# people involved in the company)
34
35
Ranking of the
alternatives can be
obtained for the
selected weights
36
Additional constraints
References
Al Harbi K.M.A.S. (1999), Application of AHP in Project Management, International
Journal of Project Management, 19, 19-27.
Haas R., Meixner, O., (2009) An Illustrated Guide to the Analytic Hierarchy Process,
Lecture Notes, Institute of Marketing & Innovation, University of Natural Resources,
retrieved from http://www.boku.ac.at/mi/ on October 2009.
Saaty, T.L., Vargas, L.G., (2001), Models, Methods, Concepts & Applications of the
Analytic Hierarchy Process, Kluwers Academic Publishers, Boston, USA.
Brans, J.P., Mareschal, B., (2010) How to Decide with Promethee, retrieved from
http://www.visualdecision.com on October 2010.
38