Cooperative Decision Making in Hierarchical Organizations

Abstract

Although the previous chapter deals with decision making problems with two decision makers under noncooperative environments and Stackelberg solutions are employed, if the decision makers reach an agreement to make decisions cooperatively, it is not always appropriate to employ the concept of Stackelberg solutions as a working plan. In this chapter, we give solution methods for decision making problems in hierarchical organizations, assuming cooperative behavior of the decision makers. Taking into account vagueness of judgements of the decision makers, we present interactive fuzzy programming for two-level linear programming problems. In the interactive method, after determining the fuzzy goals of the decision makers at both levels, a satisfactory solution is derived by updating some reference points with respect to the satisfactory level. From the viewpoint of experts’ imprecise or fuzzy understanding of the nature of parameters in a problem-formulation process, the method is extended to interactive fuzzy programming for two-level linear programming problems with fuzzy parameters. These results are extended to deal with two-level linear fractional programming problems and decentralized twolevel linear programming problems. Furthermore, applying genetic algorithms, we deal with 0-1 and nonlinear nonconvex programming problems. Finally, multiobjective two-level linear programming and stochastic two-level linear programming are dealt with.