Analytic Hierarchy Process (AHP) in Maritime Logistics: Theory, Application and Fuzzy Set Integration

Abstract

In the last few decades, there is a growing interest in using Analytic Hierarchy Process (henceforth AHP), and it is frequently employed in solving the maritime industry problem since the 2000s. The AHP method is a powerful instrument to decompose complex decision-making problems and to simplify (facilitate) decision makers’ cognitive burden. In contrast to its predecessors, AHP is capable of executing both hard and soft information (i.e. numerical data/input and subjective/judgemental assessment respectively) through a top-down investigation of micro aspects in each level of the hierarchy. Although AHP is very functional and popular in both academia and professional life, there are various biases and misuse of the method which are heavily based on the lack of theoretical basis. The AHP method has several underlying assumptions, and each assumption needs to be investigated and demonstrated through specific decision making problems. Ignoring these fundamentals of AHP eventually initiates various forms of inconsistencies and sometimes implicit invalidity which is difficult to detect from derived results. In this chapter, the theory of AHP will be discussed in detail with references to other theories in social sciences and its practical impacts on the AHP analysis. In addition to the conventional AHP methodology, the fuzzy set extension (Fuzzy AHP or FAHP) and its rationale in particular problems will be investigated. Empirical applications will help clarifying its capability of solving some maritime and logistics problems while developing hands-on experience with numerical examples.