Hierarchical Decision Modeling

This volume, developed in honor of Dr. Dundar F. Kocaoglu, aims to demonstrate the applications of the Hierarchical Decision Model (HDM) in different sectors and its capacity in decision analysis. It is comprised of essays from noted scholars, academics and researchers of engineering and technology management around the world. This book is organized into five parts: Technology Policy Planning, Strategic Technology Planning, Technology Assessment, Application Extensions, and Methodology Extensions. Dr. Dundar F. Kocaoglu is one of the pioneers of multiple decision models using hierarchies, and creator of the HDM in decision analysis. HDM is a mission-oriented method for evaluation and/or selection among alternatives. A wide range of alternatives can be considered, including but not limited to, different technologies, projects, markets, jobs, products, cities to live in, houses to buy, apartments to rent, and schools to attend. Dr. Kocaoglu’s approach has been adopted for decision problems in many industrial sectors, including electronics research and development, education, government planning, agriculture, energy, technology transfer, semiconductor manufacturing, and has influenced policy locally, nationally, and internationally. Moreover, his students developed advanced tools and software applications to further improve and enhance the robustness of the HDM approach. Dr. Kocaoglu has made many contributions to the field of Engineering and Technology Management. During his tenure at Portland State University, he founded the Engineering and Technology Management program, where he served as Program Director and later, Department Chair. He also started the Portland International Conference on Management of Engineering and Technology (PICMET), which organizes an annual conference in international locations such as Korea, Turkey, South Africa, Thailand, and Japan. His teaching has won awards and resulted in a strong sense of student loyalty among his students even decades later. Through his academic work and research, Dr. Kocaoglu has strongly supported researchers of engineering management and has provided tremendous service to the field. This volume recognizes and celebrates Dr. Kocaoglu’s profound contributions to the field, and will serve as a resource for generations of researchers, practitioners and students.

One of the most important methods in dealing with the optimization of large, complex systems is that of hierarchical decomposition. The idea is to reduce the overall complex problem into manageable approximate problems or subproblems, to solve these problems, and to construct a solution of the original problem from the solutions of these simpler prob lems. Development of such approaches for large complex systems has been identified as a particularly fruitful area by the Committee on the Next Decade in Operations Research (1988) [42] as well as by the Panel on Future Directions in Control Theory (1988) [65]. Most manufacturing firms are complex systems characterized by sev eral decision subsystems, such as finance, personnel, marketing, and op erations. They may have several plants and warehouses and a wide variety of machines and equipment devoted to producing a large number of different products. Moreover, they are subject to deterministic as well as stochastic discrete events, such as purchasing new equipment, hiring and layoff of personnel, and machine setups, failures, and repairs.

Distributed decision making is described in this book from a hierarchical perspective. A unified approach allows to treat such seemingly diverse fields as multi-level decision making, hierarchical production planning, principal agent theory, hierarchical negotiations, and dynamic games within the framework of a general pair of functional equations. In doing so, the book covers the range from a multi-level one-person decision problem to a multi-person antagonistic planning and leadership situation. These general ideas are illustrated with numerous examples and real-life planning situations. In addition, the treatise provides a theoretical foundation for important problem areas in business administration such as hierarchical production planning, the problems of design and implementation, modern concepts in managerial accounting, and supply chain management.

The last decade has experienced major societal challenges at the intersection of technological systems and policy making. Prevalent examples are the liberalization of energy and telecommunications markets, the public aversion towards nuclear power plants, the development of high-speed trains, the debates about global warming and sustainability, the development of intelligent vehicle systems, and the controversies concerning the location of waste depositories, airports, and energy systems. These challenges, coupled with the call from industry for a systems-engineering oriented approach to policy analysis, motivated Delft University of Technology to launch the first European School of Systems Engineering, Policy Analysis. and Management (SEPA). The purpose was to educate engineering oriented policy analysts in bridging the gap between engineering systems and policy decision making processes, both for the public and private sector. Up to now, more than 500 first-year students and 30 Ph.D. students have enrolled in the program. In 1993, I set up a class called Quantitative Methods for Problem Solving which had to address the most relevant issues in decision making for policy management, such as linear and non-linear optimization, multiattribute utility theory, multicriteria decision making, concepts from game theory, outranking relations, and probabilistic influence diagrams.

This book is about how to make decisions using the Analytic Hierarchy Process. The basics of the theory are described in a clear, non-technical manner with many examples. It is suitable for business leaders and also is probably the best book for introducing the AHP to students at the college and graduate level. In this fifth printing of the book the reader will find a new appendix containing real-life applications that validate the use of the fundamental scale of the AHP.

This book offers a simple introduction to the theory and practice of the Analytic Hierarchy Process (AHP) without a pre-requisite for a sophisticated mathematical background. AHP is an intuitive and mathematically simple methodology in the field of multi-criteria decision making in Operational Research (OR). Using Super Decisions v3, the newly developed software by the Creative Decisions Foundations, this book provides a quick and intuitive understanding of AHP using spreadsheet examples and step-by-step software instructions. Super Decisions v3 marks a drastic departure from the previous version 2 in terms of interface and ratings model development. In addition to a concise guide, instructional videos are also available to demonstrate how to use the different features of Super Decisions v3. Most AHP books assume the reader has basic OR mathematical background; however, AHP was developed with the goal that decision makers can take advantage of this methodology without struggling with the mathematics behind it. For this reason, only basic arithmetic knowledge is required from the readers. In conclusion, this book delivers a quick and practical understanding of the AHP methodology that can be useful for corporate executives and decision-makers in all fields.

This book is a comprehensive summary, primarily of the author's own thinking and research, about the Analytic Hierarchy Process and decision making. It includes advanced mathematical theory and diverse applications. Fundamentals of Decision Making has all the latest theoretical developments in the AHP and new theoretical material not published elsewhere. We consider this book to be the replacement for the original book on the subject, The Analytic Hierarchy Process that was published by McGraw Hill Publishers, New York.

Analytic Hierarchy Process is one of the most widely known and applied multi-criteria decision-making methodologies worldwide. Its potential to analyze complex decision-making problems is enormous. This makes the methodology a very flexible "tool" that can be applied in various scenarios (social, engineering, economic, political, environmental, location, market share, etc.). The idea of the book is to present examples and case studies based on a rigorous scientific approach to Analytic Hierarchy Process. This book is intended to be a useful resource for anyone who deals with this issue.