This makes the eventual decision optimal for that group, not necessarily the best or most correct one. The value of AHP is that it consolidates the understanding and perspectives of a group of people. Understanding how AHP works is important to make use of this powerful but simple technique. Why is AHP important to understand?Ī structured way of choosing among alternatives is better than just guessing. The actual calculations for prioritization are simple, especially if you set up the matrix in an Excel worksheet.
Group decision makingĪlthough a bit trickier than a single individual making the decision, the use of a group will provide a broader and more complete perspective. By forcing a choice between paired comparisons you will eventually end up with a prioritized listing of the choices. When asked to decide between multiple choices, people often say they are all equally important. 3 benefits of AHPĪHP combines group decision making with a quantitative evaluation to provide a more structured approach than just flipping a coin or using purely a subjective approach 1. The calculations will be explained in the example presented later. The calculations can easily be done by doing this in an Excel worksheet.ġ.) Start with a table listing the evaluation criteria on each axis.Ģ.) Working row by row, ask whether the row element is more important than the column element and if so, how much more important.ģ.) Using a scale of 1-9, with the following definitions, works well.Ĥ.) Enter the number value if the row is more important than the column.ĥ.) If the column is more important than the row, use the inverse of the number value.Ħ.) Note where the row and column elements are the same, the value will be 1. While there is some flexibility in format and procedure, here is a common one used by numerous organizations. Based on these, the group can now make an informed decision as to the relative importance of the decision elements. In the final step of the process, numerical priorities are calculated for each of the decision criteria. The AHP assigns numerical values to these evaluations. In making the paired comparisons, the group can use actual data about the elements, but they typically use their subjective judgments about the elements’ relative importance. Once the appropriate criteria or elements of the decision have been selected, the group members systematically evaluate the various elements by comparing them to each other two at a time. Using a specially designed format, each member of the team uses the process of a forced choice paired comparison to rate the relative importance of each pair of items. It represents a semi-objective approach to quantifying the weights and preferences of decision criteria.
Overview: What is Analytic Hierarchy Process (AHP)?ĪHP is a structured group decision making technique for organizing and analyzing complex decisions. Let’s learn how AHP might be a good tool for prioritizing your decisions. The same goes for which customer requirement you need to focus on when doing your Six Sigma project. When making decisions about which car to purchase, which house to buy, where to take your family vacation or where to go to dinner, you often have to evaluate and prioritize multiple criteria and choices. Definition of Analytic Hierarchy Process (AHP): « Back to Glossary Index
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