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Analytic Hierarchy Process A generic multi-criteria decision making process Aldis@sharepointconsultingservices.com
Dr. Thomas Saaty (lifetime of work) Simple yet mathematically sound Uses psychology, pairwise comparisons Combines subjective and objective criteria Rational and consistent Analytic Hierarchy Process (AHP)
Choice  Ranking Prioritization Resource Allocation Benchmarking Quality Mgmt Many Applications 2007 International AHP Symposium includes 90 papers from 19 countries
Recent Examples Deciding how best to reduce the impact of global climate change (Fondazione Eni Enrico Mattei)[5] Quantifying the overall quality of software systems (Microsoft Corporation)[6] Selecting university faculty (Bloomsburg University of Pennsylvania)[7] Deciding where to locate offshore manufacturing plants (University of Cambridge)[8] Assessing risk in operating cross-country petroleum pipelines (American Society of Civil Engineers)[9] Deciding how best to manage U.S. watersheds (U.S. Department of Agriculture)[4]
In 2008, The Institute for Operations Research and Management Sciences awarded Thomas L. Saaty the INFORMS Impact Prize for his development of the Analytic Hierarchy Process It’s been around for a while AND..
[object Object],Prioritize our customers and allocate R&D budgets accordingly. ,[object Object],Customers were segmented into 12 categories. ,[object Object],Five key criteria where developed for judgment ,[object Object],Pairwise comparisons  using relative scale ,[object Object],Real  current annual revenue and experts for subjective criteria ,[object Object],Allocate budgets according to priorities, sensitivity analysis showed new markets score low Decision Making Steps
Most accurate way for humans to judge (5-9 max) Relative Judgement Scale used These numbers and words are based on empirical research over 25 years Pairwise Comparisons  ,[object Object]
7 very strong
5 strong
3 moderate
1 equal,[object Object]
Revenue Example: Quantitative Judgments Current Revenue Normalized

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PCT2010 - 5 Min - Analytic Hierarchy Process

  • 1. Analytic Hierarchy Process A generic multi-criteria decision making process Aldis@sharepointconsultingservices.com
  • 2. Dr. Thomas Saaty (lifetime of work) Simple yet mathematically sound Uses psychology, pairwise comparisons Combines subjective and objective criteria Rational and consistent Analytic Hierarchy Process (AHP)
  • 3. Choice Ranking Prioritization Resource Allocation Benchmarking Quality Mgmt Many Applications 2007 International AHP Symposium includes 90 papers from 19 countries
  • 4. Recent Examples Deciding how best to reduce the impact of global climate change (Fondazione Eni Enrico Mattei)[5] Quantifying the overall quality of software systems (Microsoft Corporation)[6] Selecting university faculty (Bloomsburg University of Pennsylvania)[7] Deciding where to locate offshore manufacturing plants (University of Cambridge)[8] Assessing risk in operating cross-country petroleum pipelines (American Society of Civil Engineers)[9] Deciding how best to manage U.S. watersheds (U.S. Department of Agriculture)[4]
  • 5. In 2008, The Institute for Operations Research and Management Sciences awarded Thomas L. Saaty the INFORMS Impact Prize for his development of the Analytic Hierarchy Process It’s been around for a while AND..
  • 6.
  • 7.
  • 11.
  • 12. Revenue Example: Quantitative Judgments Current Revenue Normalized
  • 13.
  • 14. 8
  • 16. 6
  • 18. 4
  • 20. 2
  • 23.
  • 24.