Project Selection by an Integrated Decision Aid

Abstract

The use of the Analytic Hierarchy Process as part of a decision aid for research and development (R&D) project selection in a large Finnish company is described. The company’s most important operational sector is the oil industry and a comprehensive petrochemical industry has been built as an extension to oil refining. Selection of R&D projects is a decision problem of vital importance in the company’s long-range strategy. To evaluate one project proposal at a time, a subjective measurement scale is constructed for each lowest level criterion. The importance of the selection criteria as well as the measurement scales are assessed by the AΗΡ or direct rating. The overall preference model is implemented in a decision aid by integrating different software modules. The preference models of the individual managers reside in a database which is managed by a database program. These models can be updated by a general purpose decision analysis program. The man-machine interface of the system is implemented by an expert system shell.