Applying ahp to the process of choosing the best combination of locations of mobile operational units

Abstract

This paper presents the application of the Analytic Hierarchic Process (AHP) technique in helping a decision-making process of a young and small sized company that developed and currently make use of a new mobile technology for the heat treatment of wooden packaging and pallets. The decision process comprised choosing the best combination of locations to place the company’s three operational bases. As the heat treatment service must always be provided at the customers’ premises, this decision is crucial to the company survival, as well as for its growth, as it influences a large number of important variables, such as operational costs, supply and training of skilled manpower, response time to costumer’s requests, and others. The company’s portfolio of clients is rising firmly because of the innovative technology used in the process of sterilization. It is currently formed by more than 50 customers spread within a 100,000 square miles area. For the CEO, thinking exclusively in terms of costs appeared to be insufficient. That’s why the AHP was able to provide relevant inputs in this case, by incorporating other factors beyond the purely financial view in its analysis. The factors involved, their hierarchical structure and relative weights, were generated in consensus by the company’s managers and executives’ opinion.