A New Approach to Multi-criteria Decision Making (MCDM) Using the Fuzzy Binary Relation of the ELECTRE III Method and the Principles of the AHP Method

Abstract

There are several methods for Multi Criteria Decision Making (MCDM) such as multiple attribute utility theory (MAUT), the analytical hierarchy process (AHP), and Fuzzy AHP. However, these methods are compensatory optimization approaches for which bad score on some criteria can be compensated by excellent scores on other criteria. So, the Elimination and Choice Translating Reality III (ELECTRE III) was proposed to solve such problem. Nevertheless, thresholds determined by identified experts and used in this method may be inconsistent. Therefore, this paper proposes an integrated approach which employs ELECTRE III and partial concepts of AHP together, called the Consistency ELECTRE III. In this method, ELECTRE III is used in ranks the alternatives and AHP is used in determining the consistency of the criteria thresholds within ELECTRE III. In the simulation, it is found that threshold values of criteria within ELECTRE III affect the ranking of the alternatives. Specially, the ranking of the Consistency ELECTRE III and that of the ELECTRE III are different.