Analytical Hierarchy Process (AHP)

The Analytic Hierarchy Process (AHP) developed by Saaty (1977, 1980) is a robust and flexible multi-criteria decision analysis technique based on the prior articulation of preferences by the decision maker. It allows to analyze multi-criteria decision problems with both qualitative and quantitative aspects.

The AHP can be summarized as a four-step procedure:

• 1. Setting up a decision hierarchy by decomposing the decision problem into a hierarchy of interrelated elements. Each level must be linked to the next-higher level and adjacent elements within one level must not be too disparate.
• 2. Generating input data consisting of comparative judgement by pairwise comparisons of decision elements.
• 3. Synthesizing the judgments and estimate the relative weights by using the "eigenvalue" method to generate a derived ratio scale that reflects the local priorities of the elements in the hierarchy.
• 4. Determination of the aggregate relative weights of the decision elements to arrive at a set of rating for the decision alternatives.

Further references:

• International Journal of the Analytic Hierarchy Process An online journal about MCDM applications using the AHP