Ahp decision making example how to#
Ahp decision making example series#

Ahp decision making example series#

Each decision can be broken down into a series of sub-decisions.

Both K-T and AHP are known as weighted-sum models. The grades given for each criteria can then be priority weighted and aggregated in various ways. It is important that each criteria be scored using the same scale.

A set of grades for each criteria that have been assigned to each alternative (small a’s).

A set of criteria weights (row of W’s below the C’s) to set the relative priority of the criteria.

A set of criteria (top row of C’s) used to evaluate the alternatives.

A set of alternatives to decide between (far left column of A’s).

MCDM BasicsĪll MCDM methods work with a table similar to that shown in Figure 2, which consists of: Sensitivity Analysis The study of how the uncertainty in the output of a mathematical model or system (numerical or otherwise) can be apportioned to different sources of uncertainty in its inputs ( Source). It is the essence of the AHP that human judgments, and not just the underlying information, can be used in performing the evaluations ( Source). In making the comparisons, the decision makers can use concrete data about the elements, but they typically use their judgments about the elements’ relative meaning and importance. Once the hierarchy is built, the decision makers systematically evaluate its various elements by comparing them to each other two at a time, with respect to their impact on an element above them in the hierarchy. Analytic Hierarchy Process (AHP) AHP decomposes decision into a hierarchy of more easily comprehended sub-problems, each of which can be analyzed independently. Background Definitions Multi-Criteria Decision Making (MCDM) MCDM is a sub-discipline of operations research that explicitly considers multiple criteria in decision-making environments ( Source).

Ahp decision making example how to#

I will going through the details of a NASA trade study example on automotive fuel options to illustrate how to apply the method. Since AHP is more complex than K-T, I thought I would work through an example here. This mathematical aspect makes it more mysterious to folks, and I do not use this approach in presentations to upper management.

It is more mathematical in nature, and it bases the criteria weighting on the pair-wise comparison of the relative importance of the criteria. One complaint about K-T is that it simply moves the stress of arguing about alternatives to arguing about the weighting of criteria – a valid point.ĪHP is an interesting alternative to K-T. It does not make decision-making easier, but it does provide a good framework for making decisions. I took a week-long K-T course back in the 1980s, and I have used this methods for most of my trade studies because it is the most intuitive approach I know. I generally use one of two methods: Kepner-Tregoe (K-T) and Analytic Hierarchy Process (AHP). There are numerous types of MCDM, many of which are enumerated here. I usually perform trade studies using some form of Multi-Criteria Decision Making (MCDM). I have participated in hundreds of trade studies, and I have used many different approaches. Specifically, I speak about how I want trade studies to be performed in my group. One of the topics covered during my System Engineering seminar was decision making. I gave a seminar a few days ago on System Engineering – a favorite subject of mine.