The AHP Method Multi Criteria Decision Making Most popular method

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The AHP Method Multi Criteria Decision Making Most popular method AHP: Analytic Hierarchy Process Saaty 1975 See www.expertchoice.com Has been used in Iceland for ranking power plant alternatives by profitability and environmental impact

AHP 1. Define all relevant criteria and do pairwise comparison for importance => weights Wi 2. Define all relevant alternatives and do pairwise comparison against each criteria => scores Sij of each alternative for each criteria 3. Check for consistency, revise if necessary 4. Calculate weighted final score Fi = sum(i: Wi*Sij)

The AHP comparison 1 Equal 3 Minor difference 5 Certain difference 7 Great difference 9 Very great difference

AHP Example: Locating an Aluminium Smelter in Iceland Criteria: Labour, community and service Harbour, roads and infrastructure Power, closeness to a power plant Alternatives: Keilisnes Eyjafjörður Reyðarfjörður See Excel-document