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Development of a new hybrid method for multi-criteria decision making (MCDM) approach: a case study for facility location selection

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  • Fatih Topaloğlu

    (Malatya Turgut Özal University)

Abstract

Facility location selection is a difficult and very costly task to change after the business is established, so it is a very important decision for businesses. Numerical methods help make important decisions, such as determining the region where businesses will operate for a long time. For this purpose, multi-criteria decision making (MCDM) methods are widely used. Some practical disadvantages of existing MCDM methods are; In cases where the number of alternatives and criteria is high, more pairwise comparison matrices are required, matrix consistency becomes more difficult, and as the number of elements in the hierarchy increases, the problem becomes more complex and causes loss of time. The aim of this study is to develop a new hybrid method for the MCDM approach, which has a simpler mathematical infrastructure, is not affected by the increasing number of criteria, and does not require an additional consistency analysis. The proposed hybrid method includes Analytic Hierarchy Process (AHP) and Standard Scoring Method (SSM) methods. The method includes a single pairwise comparison matrix of the AHP method and the simple mathematical infrastructure of the SSM method, which makes calculations based on real values and standard formulas. In the study, the hybrid method was applied and analyzed to determine the most suitable geographical region of Turkey for the facility location of companies operating in the manufacturing sector in Turkey, in the light of 6 main criteria determined by the expert team as a result of a comprehensive literature review. It has been observed that classification, ranking and selection are possible with the AHP-SSM based hybrid method, which is recommended as the MCDM method, and the most suitable geographical region for the factory location in Turkey is the Black Sea Region. In addition, a comparative analysis was carried out between the proposed method and other MCDM methods.

Suggested Citation

  • Fatih Topaloğlu, 2024. "Development of a new hybrid method for multi-criteria decision making (MCDM) approach: a case study for facility location selection," Operational Research, Springer, vol. 24(4), pages 1-23, December.
    • Handle: RePEc:spr:operea:v:24:y:2024:i:4:d:10.1007_s12351-024-00871-4
    DOI: 10.1007/s12351-024-00871-4
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    References listed on IDEAS

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