3. Motivation
Enterprise resource planning (ERP) improves
operational efficiency by integrating business
processes and providing better access to
integrated data across the entire enterprise
Deciding which is the most suitable ERP solution is
often a difficult task for many companies.
ERP not developed in-house
4. Motivation
Organizations select and implement ERP systems
so as to obtain a variety of tangible and intangible
benefits and for strategic reasons.
The evaluation process of ERP systems needs to
take many criteria into account
organizational factors such as the complexity of the
business;
dealing with change management,
cost drivers,
its functional requirements,
system flexibility and system scalability,
external factors
5. Motivation
There is a strong possibility that in several
organizations, an ERP system will be
selected by a group.
Multicriteria group decision making involves
individuals who provide their preferences
for a set of alternatives with respect to a
set of attributes
Diverging opinions may arise
6. Introduction
This study deals with how support a group
of individuals to achieve a collective
decision when selecting an ERP system.
The methodology adopted considered that
DMs act in accordance with their own
interests and there is no information about
their relative importance to each other
7. Introduction
Which decision making method
should be used?
The selection of the most suitable
decision making method should be
based on the preference structures of
the DMs
8. Additive Model
For instance, an additive model could be
considered, such as in
Daher, S F D ; Almeida, A T (2012) The Use of Ranking Veto Concept
to Mitigate the Compensatory Effects of Additive Aggregation in Group
Decisions on a Water Utility Automation Investment. Group Decision
and Negotiation Journal, v. 21, p. 185-204.
In this case the additive model is considered for
aggregating the multiple criteria, and
Aggregating the decision makers’ preferences
A veto concept is applied for the additive
Aggregation of decision makers’ preferences
9. Outranking methods
An alternative approach is considered in this
work:
Outranking methods
Other properties are assumed for the decision
maker preference
10. Outranking methods
Outranking methods are particulary suitable
for decision-making through the notion of
weak preference and incomparability.
Outranking relations (S): “at least as good as”
aSb and not bSa a P b (a is strictly preferred to
b)
bSa and not aSb b P a (b is strictly preferred to
a)
aSb and bSa a I b (a is indifferent to b)
not aSb and not bSa a R b (a is incomparable to
b)
11. Outranking methods
Construction of an outranking relation is
based on 2 major concepts:
CONCORDANCE
Foran outranking aSb to be validated, a
sufficient majority of criteria should be in
favor of the assertion “a is at least as good
as b”.
NON-DISCORDANCE
When the concordance condition holds, none
of the criteria in the minority should oppose
too strongly to the assertion aSb.
12. ELECTRE Family methods
ELECTRE ( Elimination Et Choix Traduisant la
Realité / Elimination and Choice Expressing
the Reality)
This family seeks to obtain a set of N
alternatives that outrank those which do not
belong to the subset N.
Choice problematic:
ELECTRE I, ELECTRE Iv, ELECTRE IS;
Ranking problematic:
ELECTRE II, ELECTRE III, ELECTRE IV
Sorting problematic:
ELECTRE A, ELECTRE TRI
13. Model Proposed
Based on a combination of two outranking
methods: ELECTRE II and ELECTRE IV.
Assumptions:
The decision problem is well structured
Prior definition of a set n alternatives
Prior definition of a set k criteria
The model is organized in three steps
Alencar, L.H., Almeida, A. T., Morais, D. C.: A Multicriteria Group Decision Model
Aggregating the Preferences of Decision-Makers Based on ELECTRE Methods.
Pesquisa Operacional 30, Issue 3, 687-702 (2010)
14. Model Proposed
Individual ranking of alternatives (ELECTRE II)
Matrix of global evaluation
Group ranking of alternatives (ELECTRE IV)
15. Model Proposed
First step
ELECTRE II
Generation of individual rankings of alternatives
For each Decision Maker:
Decision Matrix D
Concordance and discordance indices
Criteria weights (inter-criteria information)
16. Model Proposed
First step
A concordance index C(a,b):
represents the coalition of arguments in favor
of the statement “a is at least as good as b ” or
in other words “a outranks b ” C (a, b) wj
{ j:g j ( a ) g j (b )}
A discordance index D(a,b) :
is used to measure the arguments that may
cast some doubt upon the latter statement.
D ( a, b) max {g j (b) g j (a)}
j: g j ( a ) g j ( b )
No veto condition: g j (a) v( g j (a)) g j (b), j J
17. Model Proposed
First step
These indices are used to construct two
pre-orders:
strong outranking relation (a SS b)
weak outranking relation (a Sw b)
C ( a, b) c
D ( a, b) d
S iff
aS b wj
j: gj ( a ) gj (b )
wj
j:gj ( a ) gj ( b )
C ( a, b) c
D ( a, b) d
aSW b iff wj wj
j: gj ( a ) gj (b ) j: gj ( a ) gj ( b )
18. Model Proposed
Second step
Obtain a matrix of global evaluation
Analyst must collect all individual ranking
and compile them in a global evaluation
matrix.
DMs are considered as criteria and their
rankings correpond to the evaluation of the
alternatives (ranking position of the
alternative)
19. Model Proposed
Third step
ELECTRE IV
Obtain a group ranking
ELECTRE IV is used in cases in which there
is a pseudo-criterion family and its main
feature is the absence of a weighting
related to the relative importance of the
criteria
20. Numerical application
Fictitious case study: ERP selection for a
Brazilian airlines
The company has to deal with inefficient
operational procedures and an IT/IS legacy
system.
In order to improve its competitiveness,
the company launch of several projects
including, an ERP system and the
reengineering of some business processes
21. Numerical application
Four decision makers:
the financial manager (DM1)
the IT/IS manager (DM2)
the operational manager (DM3)
the customer relation manager (DM4)
Analyst should conduct the decision
making process.
Number of alternatives: 4
22. Numerical application
Criteria selection
Based on: ISO/IEC 9126-1
a standard that addresses quality model
definition and its use as framework for software
evaluation
Group of criteria:
functional, portability, maintainability,
efficiency, vendor, cost
23. Numerical application
Criteria adopted
Criteria Criteria group
C1 Completeness Functional
C2 Number of simultaneous users Functional
C3 DBMS Standards Portability
C4 Number of modules Maintainability
C5 Time behavior Efficiency
C6 Length of experience Vendor
C7 License cost Cost
Installation and implementation
C8 Cost
cost
27. Final remarks
In general, decisions made in organizations
involve a group of people, from different
departments or sectors
Analyst should guarantee that client’s interest
are as well represented as possible.
An approach to support a group of decision
makers to select na ERP system
Different results could appear if ELECTRE
IV be changed to another method such as
Borda Count or Condorcet.
28. Thank you.
Suzana Daher
Federal University of Pernambuco
Brazil
sfdd@uol.com.br
suzanadaher@gmail.com