Title
Analytic hierarchy process and data envelopment analysis: A match made in heaven
Document Type
Article
Publication Date
3-21-2023
DOI
https://doi.org/10.1016/j.eswa.2023.119902
Abstract
Analytic hierarchy process (AHP) and data envelopment analysis (DEA) are two popular decision science methods with many business, science, and engineering applications. AHP is a Multi-Attribute Decision-Making (MADM) method for prioritizing alternatives, and DEA is a non-parametric method for estimating production frontiers. Each method has known strengths and weaknesses, and the strengths in one method can overcome the weaknesses in the other. We study several strategies to diminish the weaknesses of DEA with the strengths of pairwise comparisons in AHP. We tackle the low discrimination power inherent to conventional DEA methods. AHP, with its pairwise comparison capability, has been consistently used to increase the discrimination power and accuracy in DEA. We propose and evaluate several new hybrid MADM-DEA models of different computational complexity and consistency, including combinations of the best-worst method (BWM) and its variants with DEA as well as a novel method composed of Measuring Attractiveness by a Categorical Based Evaluation Technique (MACBETH) and DEA. We further develop a new technique for evaluating the similarity among multiple ranking results in MADM. The new simple but powerful technique is called Rank Absolute Deviation (RAD) and is inspired by the mean absolute deviation method. Several numerical examples and a real-world problem are used to demonstrate the applicability and efficacy of the new BWM-DEA, MACBETH-DEA, and RAD methods proposed in this study. We illustrate how less computationally demanding MADM-DEA techniques provide rankings that are highly correlated with the benchmark DEA-AHP and different consensus ranking models.
Language
English
Recommended Citation
Tavana, Madjid; Soltanifar, Mehdi; Santos-Arteaga, Francisco; and Sharafi, Hamid, "Analytic hierarchy process and data envelopment analysis: A match made in heaven" (2023). Business Systems and Analytics Faculty Work. 338.
https://digitalcommons.lasalle.edu/bsa_faculty/338
Comments
This article is the authors' final published version in Expert Systems with Applications, Volume 223, August 2023, Article number 119902.
The published version is available at https://doi.org/10.1016/j.eswa.2023.119902. Copyright © Elsevier Ltd.