Analytic Hierarchy Process (AHP) :

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1 Analytic Hierarchy Process (AHP) : ITS APPLICATION IN FTS BUSINESS MODEL ASSESSMENT Athens University of Economics and Business TRANsportation Systems and LOGistics Laboratory Professor Konstantinos G. Zografos CONFERENCE ON FLEXIBLE MOBILITY SERVICES : Business Models, Organizational and Contractual Issues Cremona, 23-24/05/05 1

LOGistics Laboratory Professor Konstantinos G.

2 1. FTS BUSINESS MODEL ASSESSMENT REQUIREMENTS Multiple Stakeholders Multiple Objectives Expert Judgment is Needed Sensitivity Analysis is Necessary to explore the Impact of alternative priority structures 2

Judgment is Needed Sensitivity Analysis is

3 2. AHP FEATURES AHP FEATURES PROBLEM CHARACTERISTICS Multiple Criteria Method Multiple Objectives Synthesizes Expert Judgments identifying Compromise solutions Multiple Stakeholders Determines Priorities of Relative Importance among the criteria, indicators, and alternatives given Experts Judgments or Objective Measurements Expert Judgment is needed Sensitivity Analysis on the Priorities Sensitivity Analysis is necessary to explore alternative priority structures 3

the criteria, indicators, and alternatives given Experts Judgments or Objective Measurements Expert Judgment is

4 HOW THE AHP WORKS PROBLEM DESCRIPTION DECOMPOSITION HIERARCHY PAIRWISE COMPARISONS GOAL C 1 C 2 C N C 1 C 2 C N PRIORITIES ALTERNATIVES WEIGHTS CRITERIA 4

5 HIERARCHY FOR ASSESSING FTS BUSINESS MODELS Rank the alternative FTS business models C1 : System Performance C2 : Organizational Efficiency C3 : Financial Feasibility C4 : Transport Level of Service C5 : Societal Impacts I1.1 : Expected System Productivity I2.1 : Degree of stakeholder coordination I2.2 : Contribution to the degree of transport integration I3.1 : Expected system costs I3.2 : Expected system revenues I3.3 : Cash flow I4.1 : Increase of comfort I4.2 : Improvement of transport reliability I5.1 : Improvement of personal mobility among target groups I5.2 : Impact on the traffic level of the target area I5.3 : Recovery/ Improvement of the local economy I5.4 : Mitigation of environmental impacts (e.g. air pollution) I5.5 : Increase transport safety FTS Business Model (1) FTS Business Model (2) FTS Business Model (n) 5

2 : Expected system revenues I3.3 : Cash flow I4.1 : Increase of comfort I4.2 : Improvement of transport reliability I5.1 : Improvement of personal mobility among target groups I5.

6 PAIRWISE COMPARISONS FOR ASSESSING FTS BUSINESS MODELS 6

7 CRITERIA FOR WEIGHTING FTS BUSINESS MODELS 7

8 PRIORITY RANKING FOR FTS BUSINESS MODELS 8

9 CONCLUDING REMARKS AHP is compatible with the FTS Business Model assessment decision making environment It requires expert judgment expressing the relative importance of the various assessment objectives/criteria/indicators. It requires the measurement of the criteria expressing the performance of each FTS business model alternative. A user friendly software package exists for the implementation of the method. The ranking of the alternative FTS business models is based on the relative performance of each competing alternative. Further financial feasibility analysis may be required. 9

It requires the measurement of the criteria expressing the performance of each FTS business model alternative.

Multi-Criteria Decision-Making Using the Analytic Hierarchy Process for Wicked Risk Problems

Multi-Criteria Decision-Making Using the Analytic Hierarchy Process for Wicked Risk Problems Introduction It has become more and more difficult to see the world around us in a uni-dimensional way and to