ANALYTIC HIERARCHY PROCESS

 What AHP is
 Structuring the hierarchy
 Establishing priorities
 Measuring consistency
What AHP is
 AHP is a multi-criteria decision analysis tool
that enable to make effective decision by
breaking down a complex problem into a
hierarchy of simpler problems
 AHP is basically a method of establishing
priorities for alternative and attribute in a
hierarchy using sets of pair-wise comparisons
 AHP uses 3 stages in solving problem
Structuring the hierarchy
 A hierarchy is a fundamental tool used by our brains
to analyse complexity by structuring a problem into
smaller parts, classifying the elements into
homogeneous sets, and arranging these sets into
different levels
 General suggestion for generating a hierarchy:
 Identify the overall goal
 Identify the criteria
 Identify sub-criteria under each criterion
 Identify the alternatives
Establishing priorities
 Developing a matrix of pair-wise comparison
 Derived priorities from the matrix
Measuring consistency
 Consistency means that the interrelationship
between the elements under a criterion,
which were compared in pairs, is in a logical
order
 The value of the consistency ratio should be
less than 10%
 Hierarchy for choosing job satisfaction

Level 1
Goal
Overall Job Satisfaction

Level 2
Criteria
Research Growth Benefit Colleagues Location Reputation

Level 3
Alternative
A B C
 Setting pair-wise comparison matrix
Level 1
Goal
Overall Job Satisfaction

Level 2
Criteria
Research Growth Benefit Colleagues Location Reputation

Level 3
Alternative
A B C

col A B C
A 1 1/3 5
B 3 1 7
C 1/5 1/7 1
 fundamental scale for
pair-wise comparisons

n 1 2 3 4 5 6 7 8 9 10
The value of
consistency index RI 0 0 0.52 0.89 1.11 1.25 1.35 1.40 1.45 1.49
 Setting priorities
[PW] [PW] [RD] [RS] [NM]

1 1/3 5 1 1/3 5 3.0 1.4 12.3 16.71 0.28

3 1 7 X 3 1 7 = 7.4 3.0 29.0 39.40 0.65
1/5 1/7 1 1/5 1/7 1 0.8 0.4 3.0 4.18 0.07
Total [RS] 60.30

Measuring consistency
[SPW] [NM] [λmax]
RI = 0.52, for n = 3,
4 1/5 1 1/2 13 X 0.28 = 3.03 Therefore,

0.65 CI = (λ m a x – n) / (n – 1).
CI = (3.03 – 3) / (3 - 1) = 0.015
0.07

CR = (CI / RI)
CR = (0 / 0.52) =0.028 = 3%
research A B C Priorities CR growth A B C Priorities CR

A 1 1/4 1/2 0.14 1% A 1 1/4 1/5 0.10 1%

B 4 1 3 0.63 B 4 1 1/2 0.33

C 2 1/3 1 0.24 C 5 2 1 0.57

benefit A B C Priorities CR colleague A B C Priorities CR

A 1 3 1/3 0.32 49% A 1 1/3 5 0.28 3%

B 1/3 1 1 0.22 B 3 1 7 0.65

C 3 1 1 0.46 C 1/5 1/7 1 0.07

location A B C Priorities CR reputation A B C Priorities CR

A 1 1 7 0.47 0% A 1 7 9 0.77 7%

B 1 1 7 0.47 B 1/7 1 5 0.17

C 1/7 1/7 1 0.07 C 1/9 1/5 1 0.05

Level 1
Goal
Overall Job Satisfaction

Level 2
Criteria
Research Growth Benefit Colleagues Location Reputation

Level 3
Alternative
A B C

Overall job satisfaction matrix

Overall job Res Gro Ben Col Loc Rep priorities CR
satisfaction
Research 1 1 1 4 1 1/2 0.16 5%
Growth 1 1 2 4 1 1/2 0.19
Benefit 1 1/2 1 5 3 1/2 0.19
Colleagues 1/4 1/4 1/5 1 1/3 1/3 0.05
Location 1 1 1/3 3 1 1 0.12
Reputation 2 2 2 3 3 1 0.30
 Synthesising process

Overall Job Satisfaction

0.16 0.19 0.19 0.05 0.12 0.30

Research Growth Benefit Colleagues Location Reputation

A 0.40 B 0.34 C 0.26

Res=0.14 Res=0.63 Res=0.24
Gro=0.10 Gro=0.33 Gro=0.57
Ben=0.32 Ben=0.22 Ben=0.46
Col=0.28 Col=0.65 Col=0.07
Loc=0.47 Loc=0.47 Loc=0.07
Rep=0.77 Rep=0.17 Rep=0.05
 Synthesising the overall priorities

A B C

Research (0.16) 0.16 x 0.14 0.16 x 0.63 0.16 x 0.24

+ + +
Growth (0.19) 0.19 x 0.10 0.19 x 0.33 0.19 x 0.57
+ + +
Benefit (0.19) 0.19 x 0.32 0.19 x 0.22 0.19 x 0.46
+ + +
Colleague (0.05) 0.05 x 0.28 0.05 x 0.65 0.05 x 0.07
+ + +
Location (0.12) 0.12 x 0.47 0.12 x 0.47 0.12 x 0.07
+ + +
Reputation (0.30) 0.30 x 0.77 0.30 x 0.17 0.30 x 0.05
= = =
Overall priorities 0.40 0.34 0.26