1 / 13

Executive Manager

Executive Manager. Decision Making and Policy Planning, typically with many goals Sometimes even > 1 decision maker (Game Theory, Group Decisions) Linear Programming with many goals -> Goal Programming Also decision problems that are not LP -> MCDM methods. Multi Criteria Examples.

earp
Download Presentation

Executive Manager

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Executive Manager • Decision Making and Policy Planning, typically with many goals • Sometimes even > 1 decision maker (Game Theory, Group Decisions) • Linear Programming with many goals -> Goal Programming • Also decision problems that are not LP -> MCDM methods

  2. Multi Criteria Examples • Facility Location • Supplier Selection • Equipment Purchasing • Prioritizing Projects • Job Applicants Evaluation • Environmental Assessment

  3. EQI for Icelandic Power Plants • Versatility, Uniqueness, Size, International Importance, Informational Value: • Cultural • Ecosystems • Animal & Plant Species • Earth & Water systems • Geology, waste untouched areas • Outdoor activities, tourism, farming, …

  4. Multi Criteria Decision Making • Goal Programming • Pareto optimality • MAUT, Multi Attribute Utility Theory, Keeney & Raiffa • Europe: Electra (Roy et al.) • USA : AHP (Saaty)

  5. Goal Programming, GP • LP model with many objective functions • See AdGoals.xls in chapter 9 in W&A • Soft vs Hard Constraints • Deviation Variables • Priorities, Preemptive Optimization • Weights on Criteria

  6. Pareto Optimality • Not possible to improve one criteria while maintaining all others • Trade-off curves, efficient frontier • See Chemcon.xls and AdTradeoff.xls

  7. Analytic Hierarchy Process • Thomas Saaty 1975 • Expert Choice Software (www.expertchoice.com) • >1500 books and papers on AHP • Case Studies Collection • See Solver3.xls (Facility Location) and AHPJobs.xls in chapter 9

  8. AHP, Pros & Cons • Pros: • Doable • Pairwise Comparison • Consistency Index • Cons: • AHP scale (1-9) • Difficult if very many alternatives

  9. AHP method • 1. Pairwise Comparison of Criteria => Weights of Criteria. Check Consistency. • 2. Pairwise Comparison of Alternatives against each criteria => grading. Check Consistency. • 3. Final grade calculated from weights and grading for each criteria. Sensitivity Analysis

  10. AHP Scale • 1 Equal • 3 Slightly more important • 5 Strongly more important • 7 Very strongly more important • 9 Absolutely more important

  11. Pairwise Comparison • Wi = Weight of Criteria nr. i W1/W1 W1/W2 W1/Wn W2/W1 W2/W2 W2/Wn A = • Wn/W1 Wn/W2 Wn/Wn

  12. Consistency Check • 1. Calculate A*w’ • 2. M = (1/n)*i(A*w’)i/w’i • 3. CI = (M – n)/(n – 1) • 4. CI/RI > 0,1 => Inconsistency • Where: n = 2 3 4 5 6 7 8 • => RI = 0 0,58 0,90 1,12 1,24 1,32 1,41

  13. Pareto Efficient Frontier Cost Alt 2 Alt 5 Alt 3 Alt 4 Alt 1 Grade for other

More Related