Compatibility and correlation of multi-attribute decision making: a case of industrial relocation

Jose Martino Neto; Valerio Antonio Pamplona Salomon; Miguel Angel Ortiz-Barrios; Antonella Petrillo

doi:10.1007/s10479-022-04603-9

Compatibility and correlation of multi-attribute decision making: a case of industrial relocation

Ann Oper Res. 2022 Feb 28:1-22. doi: 10.1007/s10479-022-04603-9. Online ahead of print.

Authors

Jose Martino Neto¹, Valerio Antonio Pamplona Salomon¹, Miguel Angel Ortiz-Barrios², Antonella Petrillo³

Affiliations

¹ Department of Production, Sao Paulo State University, Av. Ariberto P. Cunha 333, Guaratingueta, SP 12516-410 Brazil.
² Department of Productivity and Innovation, Universidad de la Costa CUC, 58th Street # 55-66, Barranquilla, Colombia.
³ Department of Engineering, University of Naples Parthenope, Isola C4, Centro Direzionale, 80143 Naples, NA Italy.

Abstract

Industrial relocation (IR) is a business strategy consisting of moving operations locations. The purpose of this paper is to present how to assess, with multi-attribute decision-making (MADM), alternatives for IR. With MADM, IR strategies can be assessed not only based on a single attribute, as costs, or profits. This paper presents the application of MADM in a real case of IR. Four leading methods of MADM were applied: analytic hierarchy process (AHP), multi-attribute utility theory (MAUT), multi-attribute value theory (MAVT), and technique of order preference by similarity to ideal solution (TOPSIS). Results of AHP, MAUT, MAVT, and TOPSIS were quite similar, indicating the decision for the company not to relocate. A joint comparison of results with compatibility indices and correlation coefficients is the major novelty presented by this paper to the field of Operations Research, known as MADM.

Keywords: Analytic hierarchy process; Compatibility; Correlation; Industrial relocation; Multi-attribute utility theory; Technique of order preference by similarity to ideal solution.