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Abstract Plant location selection has invariably a significant impact on the performance
of many companies or manufacturing systems. In this paper, a new integrated methodology
is structured to solve this selection problem. Two well-known decision making methods,
namely analytic hierarchical process (AHP) and VlseKriterijumska Optimizacija I
Kompromisno Resenje (VIKOR), are combined in order to make the best use of
information available, either implicitly or explicitly. In addition, the Delphi method is
utilized to select the most influential criteria by a few experts. The aim of using the AHP is
to give the weights of the selected criteria. Finally, the VIKOR method is taken into
account to rank potential alternatives. Finally, an application example demonstrates the
suitability of the proposed methodology.
Keywords Decision Making, Plant Location Selection, AHP, VIKOR
. .
VIKOR AHP
Delphi .
. AHP .
. VIKOR
..
1. INTRODUCTION
The plant location problem plays a very important
role in minimizing the cost and maximizing the use
of resources for many companies [1]. Location
problems involve determining the location of one
or more new facilities in one or more of several
potential sites [2]. Many potential criteria, such as
IJE Transactions B: Applications
2. PROPOSED METHODOLOGY
During the last four decades many researchers
devoted their times and efforts to best design
methodologies for decision making purposes under
different and, in most cases, conflict criteria. These
proposed methodologies are designed in such a
way that makes the use of MCDM methods as
efficient as possible. In this paper, two well-known
methods, namely AHP and VIKOR, are combined
in order to rank alternatives with respect to criteria.
Besides, the Delphi method is also used as a prestep. The reason for using the Delphi method is to
select the criteria among set of possible criteria
defining all aspects of the under-consideration
problem, and to provide alternative values with
respect to each criterion in order to form the
decision making matrix.
The Delphi method accumulates and analyzes
the results of anonymous experts that communicate
in written, discussion and feedback formats on a
particular topic. Anonymous experts share
knowledge skills, expertise and opinions until a
mutual consensus is achieved [31,32]. This method
consists of five procedures:
1) Select the anonymous experts
2) Conduct the first round of a survey
3) Conduct the second round of questionnaire
survey
4) Conduct the third round of questionnaire
survey
5) Integrate experts opinions to reach a
consensus
The group of decision makers (DMs) should
not be too large. Typically the modified Delphi
method summarizes the experts opinions between
10 and 30 [33, 34]. Taskin [31] suggested that 15
experts participate in their modified Delphi
method. Thus, in this study the number of
anonymous experts participated is limited to 15.
On the other hand, one important characteristic of
Vol. 24, No. 2, July 2011 - 129
p
n
L p , j = wi ( f i * f ij )/ ( fi * f i ) ,
i=1
1 p ; j = 1, 2,K, J .
k
wij = wijk k k
k
(1)
f ij1 ) + K + ( k f ijk )
1 + K + k
(2)
and
(3)
f = min fij
i
w j ( f j f ij ) ( f j f j ) , S i and Ri :
by
Si = w j ( f j* fij ) ( f j* f j )
(4)
j =1
Ri = max w j ( f j* fij ) ( f j* f j )
j
(5)
S = max Si
i
R = min Ri
i
R = max Ri
i
Qi = v (S i S * ) (S S * ) +
(1 v )(Ri R * ) (R R * )
(6)
(7)
1
( DQ = 0.25 if m 4 )
(8)
m 1
Where A is in the second position in the ranking
list determined by Eq. (8). Condition 2 is called
acceptance stability in decision making. Under this
condition, Q( A) should be best ranked by S ( A)
or/and R( A) . This compromise solution is stable
within the decision making process, which can be
the strategy of maximum group utility or by
consensus or by veto [36]. If one of the conditions
is not satisfied, the set of compromise solution is
proposed. If Condition 1 is not accepted
A, A, K , A (m ) is the set of compromise solution.
DQ =
( )
3. AN APPLICATION EXAMPLE
In this section, a home appliance manufacturer is
regarded as an application example to demonstrate
the efficiency of the proposed methodology.
Explanation
Score
Equally
Moderately
Strongly
Very
strongly
Extremely
3
5
6.22 5
7 5.22
S1 = 0.384
+ 0.173
+ 0.281
6.22 3.44
7 4.56
6.22 5.78
2.78 2.78
+ 0.109
+ 0.052
6
.
22
3
.
33
2.78 1.44
7.11 7.11
= 0.338
7.11 1.89
6.22 3.44
77
S 2 = 0.384
+ 0.173
+
6.22 3.44
7 4.56
6.22 3.33
2.78 1.78
0.281
+ 0.109
+ 0.052
6.22 3.33
2.78 1.44
7.11 1.89
= 0.799
7.11 1.89
6.22 6.22
7 4.56
S 3 = 0.384
+ 0.173
+
6.22 3.44
7 4.56
6.22 6.22
2.78 1.44
0.281
+ 0.109
+ 0.052
6.22 3.33
2.78 1.44
7.11 3.67
= 0.316
7.11 1.89
6.22 5
7 5.22
R1 = Max{0.384
,0.173
,
6.22 3.44
7 4.56
6.22 5.78
2.78 2.78
0.281
,0.109
,0.052
6.22 3.33
2.78 1.44
7.11 7.11
} = 0.169
7.11 1.89
6.22 3.44
77
R2 = Max{0.384
,0.173
,
6
.
22
3
.
44
7 4.56
6.22 3.33
2.78 1.78
0.281
,0.109
,0.052
6
.
22
3
.
33
2.78 1.44
7.11 1.89
} = 0.384
7.11 1.89
6.22 6.22
7 4.56
R3 = Max{0.384
,0.173
,
6
.
22
3
.
44
7 4.56
6.22 6.22
2.78 1.44
0.281
,0.109
,0.052
6
.
22
3
.
33
2.78 1.44
7.11 3.67
} = 0.173
7.11 1.89
0.388 0.316
0.169 0.169
Q1 = 0.5
+ 0.5
0.799 0.316
0.384 0.169
= 0.023
0.799 0.316
0.384 0.169
Q2 = 0.5
+ 0.5
=1
0.799 0.316
0.384 0.169
0.316 0.316
0.173 0.169
Q3 = 0.5
+ 0.5
= 0.009
0.799 0.316
0.384 0.169
To obtain the final ranking of alternatives, two
conditions in Step 6.5 should be verified so that the
final ranking and compromise solution can be
obtained. For the illustration purposes, using Eq.
(7) we have Q ( A) Q( A) = 0.014 < 0.25 . The
acceptance advantage (Condition 1) is not
satisfied, although the stability in decision making
is completely satisfied. Since Condition 1 is not
satisfied, there must be a compromise solution
consisting of first m alternative for which the
inequality Q (Am ) Q ( A) < DQ must be attained.
In this example m=2. In other words, the
alternative in the second position ( Q1 ) forms a
compromise solution together with the alternative
( Q3 ) in the first position.
TABLE 2. Inter-criteria comparisons matrix
Cri.
No.
C1
C2
C3
C4
C5
C1
C2
C3
C4
C5
E
1
E
2
E
3
E
1
E
2
E
3
E
1
E
2
E
3
E
1
E
2
E
3
E
1
E
2
E
3
0.3
0.2 0.14
0.5
0.3 5
0.3
0.25 1
0.11
1 0.3
1
3 0.2 0.5
C1
0.418
C2
0.476
C3
0.489
C4
0.295
C5
0.239
C2
0.136
0.155
0.154
0.184
0.238
C3
0.213
0.251
0.249
0.391
0.303
C4
0.138
0.083
0.062
0.098
0.165
C5
0.095
0.036
0.045
0.032
0.055
Weights
0.384
0.173
0.281
0.109
0.052
C1
E E
2 3
5 1
E
1
4
C2
E E E
2 3 1
1 8 5
C3
E E E
2 3 1
6 7 3
C4
E E E
2 3 1
3 2 7
C5
E E
2 3
6 9
A1
E
1
7
A2
3 1
4 7
1 5
A3
3 4
Q1
Q2
Q3
Sol.
0.019
Q1 , Q3
Alter.
C1
C2
C3
C4
C5
0.1
0.005
0.017
Q1 , Q3
A1
A2
A3
5
3.44
6.22
5.22
7
4.56
5.78
3.33
6.22
2.78
1.78
1.44
7.11
1.89
3.67
0.2
0.009
0.015
Q1 , Q3
o.3
0.014
0.013
Q1 , Q3
0.4
0.018
0.011
Q1 , Q3
0.5
0.023
0.009
Q3 , Q1
0.6
0.027
0.008
Q3 , Q1
0.7
0.032
0.006
Rank
2
Q3 , Q1
0.8
0.036
0.004
Q3 , Q1
0.9
0.041
0.002
Q3 , Q1
0.045
Q3 , Q1
A1
A2
0.799
0.384
A3
0.316
0.173
0.009
4. SENSITIVITY ANALYSIS
1.2
1
0.8
Q1
0.6
Q2
Q3
0.4
0.2
0
1
10
11
5. CONCLUSIONS
To minimize the cost and maximize the use of
resources, selecting a suitable plant location has
become one of the most important issues for
manufacturing companies that has major impact on
facility in the long run. This paper aims at
designing a multi-criteria decision making
(MCDM) model for evaluation alternatives,
Vol. 24, No. 2, July 2011 - 135
[10]
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[13]
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6. REFERENCES
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[3]
[4]
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[6]
[7]
[8]
[9]
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