Analytic Hierarchy Process

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The Analytic Hierarchy Process (AHP) is a structured technique for dealing with complex decisions. Based on mathematics and human psychology, it was developed by Thomas L. Saaty in the 1970s and has been extensively studied and refined since then. It is used throughout the world in a wide variety of decision situations, in fields such as government, business, industry, healthcare, quality, and education.

The AHP provides a method for decomposing a complex decision problem into a hierarchy of more easily comprehended sub-problems, each of which can be worked with and evaluated on its own. When evaluating this hierarchy, the AHP considers measurements and other objective data about its various elements, but its essential nature is to work with the decision makers’ judgments about the meaning and importance of that information. It also works with their judgments about intangible aspects of the decision.

The AHP converts the decision makers' judgments to numerical values that can be processed, evaluated and compared over the entire range of the problem. In the end, a numerical weight or priority is derived for each element of the hierarchy, allowing those elements to be compared to one another in a direct and consistent way. This capability distinguishes the AHP from other decision making techniques. It not only allows the decision to be considered more rationally and objectively, but it encourages communication that leads to a better global understanding of the problem and its possible solutions.

Uses and applications

While it can be used by individuals working on straightforward decisions, AHP is most useful where teams of people are working on complex problems, especially those with high stakes, involving human perceptions and judgments, whose resolutions have long-term repercussions.[1] It has unique advantages where important elements of the decision are difficult to quantify or compare, or where communication among team members is impeded by their different specializations, terminologies, or perspectives. Computer software is available to assist in the application of the process.

The applications of AHP to complex decision situations have numbered in the thousands,[2] and have produced extensive results in problems involving alternative selection, planning, resource allocation, and priority setting.[1] Many such applications are never reported to the outside world, because they take place at high levels of large organizations, where security and privacy considerations prohibit their disclosure. But some uses of AHP are discussed in the literature. Recently these have included:

AHP was recently applied to a project that uses video footage to assess the condition of highways in Virginia. Highway engineers first used it to determine the optimum scope of the project, then to justify its budget to lawmakers.[8]

The process is widely used in countries around the world. At a recent international conference on AHP, over 90 papers were presented from 19 countries, including the U.S., Germany, Japan, Chile, Malaysia, and Nepal. Topics covered ranged from Establishing Payment Standards for Surgical Specialists, to Strategic Technology Roadmapping, to Infrastructure Reconstruction in Devastated Countries.[9] AHP was introduced in China in 1982, and its use in that country has expanded greatly since then—its methods are highly compatible with the traditional Chinese decision making framework, and it has been used for many decisions in the fields of economics, energy, management, environment, traffic, agriculture, industry, and the military.[10]

Though using AHP requires no specialized academic training, the subject is widely taught at the university level—one AHP software provider lists over a hundred colleges and universities among its clients.[11] AHP is considered an important subject in many institutions of higher learning, including schools of engineering[12] and graduate schools of business.[13] AHP is also an important subject in the quality field, and is taught in many specialized courses including Six Sigma, Lean Six Sigma, and QFD.[14][15][16]

In China, nearly a hundred schools offer courses in AHP, and many doctoral students choose AHP as the subject of their research and dissertations. Over 900 papers have been published on the subject in that country, and there is at least one Chinese scholarly journal devoted exclusively to AHP.[10]

See also

References

  1. ↑ 1.0 1.1 Bhushan, Navneet; Kanwal Rai (January, 2004). Strategic Decision Making: Applying the Analytic Hierarchy Process. London: Springer-Verlag. ISBN 1-8523375-6-7. 
  2. ↑ 2.0 2.1 de Steiguer, J.E. (October, 2003), The Analytic Hierarchy Process as a Means for Integrated Watershed Management, in Renard, Kenneth G., First Interagency Conference on Research on the Watersheds, Benson, Arizona: U.S. Department of Agriculture, Agricultural Research Service, at 736-740
  3. ↑ Berrittella, M. (January, 2007), An Analytic Hierarchy Process for the Evaluation of Transport Policies to Reduce Climate Change Impacts, Fondazione Eni Enrico Mattei (Milano)
  4. ↑ McCaffrey, James (June, 2005). "Test Run: The Analytic Hierarchy Process". MSDN Magazine. Retrieved on 2007-08-21.
  5. ↑ Grandzol, John R. (August, 2005). "Improving the Faculty Selection Process in Higher Education: A Case for the Analytic Hierarchy Process". IR Applications 6. Retrieved on 2007-08-21.
  6. ↑ Atthirawong, Walailak (September, 2002), An Application of the Analytical Hierarchy Process to International Location Decision-Making, in Gregory, Mike, Proceedings of The 7th Annual Cambridge International Manufacturing Symposium: Restructuring Global Manufacturing, Cambridge, England: University of Cambridge, at 1-18
  7. ↑ Dey, Prasanta Kumar (November, 2003). "Analytic Hierarchy Process Analyzes Risk of Operating Cross-Country Petroleum Pipelines in India". Natural Hazards Review 4 (4): 213-221. Retrieved on 2007-08-20.
  8. ↑ Larson, Charles D. (January, 2007), Application of the Analytic Hierarchy Process to Select Project Scope for Videologging and Pavement Condition Data Collection, 86th Annual Meeting Compendium of Papers CD-ROM, Transportation Research Board of the National Academies
  9. ↑ Participant Names and Papers, ISAHP 2005, Honolulu, Hawaii (July, 2005). Retrieved on 2007-08-22.
  10. ↑ 10.0 10.1 Sun, Hongkai (July, 2005), AHP in China, in Levy, Jason, Proceedings of the 8th International Symposium on the Analytic Hierarchy Process, Honolulu, Hawaii
  11. ↑ List of Expert Choice education clients. Retrieved on 2007-08-23.
  12. ↑ Drake, P.R. (1998). "Using the Analytic Hierarchy Process in Engineering Education". International Journal of Engineering Education 14 (3): 191-196. Retrieved on 2007-08-20.
  13. ↑ Bodin, Lawrence; Saul I. Gass (January, 2004). "Exercises for Teaching the Analytic Hierarchy Process". INFORMS Transactions on Education 4 (2). Retrieved on 2007-08-20.
  14. ↑ Hallowell, David L. (January, 2005). "Analytical Hierarchy Process (AHP) -- Getting Oriented". iSixSigma.com. Retrieved on 2007-08-21.
  15. ↑ "Analytic Hierarchy Process (AHP)". QFD Institute. Retrieved on 2007-08-21.
  16. ↑ "Analytical Hierarchy Process: Overview". TheQualityPortal.com. Retrieved on 2007-08-21.
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