An introduction to the

Multicriteria Analysis

Antonio Hoyos
jahoyosch@udea.edu.co

Facultad de Ingeniería
Departamento de Ingeniería Industrial
Antonio Hoyos PE&AD October, 2017
Introduction
• Multicriteria decision making (MCDM)
– Make decisions in presence of multiple criteria.
(objectives).
– Apply for many real situations.

Think about
– Desing a health policy
– Building an airport
– Looking for a job
– Looking for a major
– Get a boy (gilr) friend
(Xu & Yang, 2001)
Antonio Hoyos PE&AD October, 2017
Introduction
See a example

• Looking for a mayor in the UDEA

– Job market upon graduation

– Job pay and opportunity to progress
– Interest in the major
– Likelihood of success in the major
– Future job image
– Parent wish How to decide?
– Social status
(Xu & Yang, 2001)
Antonio Hoyos PE&AD October, 2017
Main features of MCDM
MCDM problems can have discrete or continuos solutions.
These are their main features.

• Multiple criteria/attributes often form a hierarchy

• Conflict among criteria
• Hybrid nature
– Incommensurable units
– Mix of quantitative and qualitative attributes
– Mix of sthocastic and deterministic attributes
• Uncertainty
– Subjective judgments
– Lack of data or incomplete information
• Large scale
• Assessment may not be conclusive
(Xu & Yang, 2001)
Antonio Hoyos PE&AD October, 2017
MCDM Solutions
Frecuently this kind of problems don´t have an conclusive solution.

• Ideal solution: maximise all profit criteria and minimise all cost
criteria. Almost always exist. Is the best of the best.

• Non-dominated solutions: a set of alternatives that are not

dominated.

• Satisfying solutions: are alternatives that superate the decision

maker’s expectations. May not be a non-dominated solution.

• Preferred solutions: is a non-dominated solution that best

satisfies the decision maker´s expections.
(Xu & Yang, 2001)
Antonio Hoyos PE&AD October, 2017
MCDM Methods
There are two kinf of methods, compensatory and not
compensatory.

Non-compensatory: do not permit tradeoffs between attributes.

An unfavourable value in one attribute cannot be offset by a
favourable value in other attributes

Compensatory: permit tradeoffs between attributes. A slight

decline in one attribute is acceptable if it is compensated by
some enhancement in one or more other
attributes.

(Xu & Yang, 2001)

Antonio Hoyos PE&AD October, 2017
Non-compensatory methods
Examples of these methods included:

• Dominance method
• Maxmin method
• Maxmax method
• Conjunctive constraint method: attribute against a standar
• Disjunctive constraint method: best attribute regardlees of all
other attributes.

Are not useful for general decision making

(Xu & Yang, 2001)
Antonio Hoyos PE&AD October, 2017
Compensatory methods
Can be classified in:

• Scoring methods: selects or evaluates an alternative

according to its score (or utility). Utility or score is used to
express the decision maker’s preference.

• Compromising methods: selects an alternative that is closest

to the ideal solution.

• Concordance methods: generates a preference ranking which

best satisfies a given concordance measure.

(Xu & Yang, 2001)

Antonio Hoyos PE&AD October, 2017
References
• Xu, L., Yang, J. (2001). Introduction to multicriteria decision
making and the evidential reasoning approach. Working paper
0106.https://phps.portals.mbs.ac.uk/Portals/49/docs/jyang/X
uYang_MSM_WorkingPaperFinal.pdf

Antonio Hoyos PE&AD October, 2017