Multi-Criteria Decision Analysis - Case Study Example

Part A Multi-criteria decision analysis Introduction The problem involves 4 professionals who have just been through MBA program and have managed to secure well paying jobs with organization in the city. The professionals are to find appropriate places for living as they take on their new jobs. All the professionals have a lot of work and most of the time they carry some work at home and thus it has made it necessary for them to go for houses which are based in various areas within the town vicinity. When required to attend a meeting in company headquarters, it was necessary for each of them to travel and spend several days to near the company headquarters and thus looking for accommodation in hotels. The cost of hotel accommodation has been to be taken care of by them since it was their choice to live outside the town where the headquarters are located. After engaging in lengthy discussion together with thorough research, it occurred to the 4 professionals that through pulling resources together it would be possible for them to purchase an apartment inside the city which would cost almost the same if not less than the costs incurred in hotel room bills. Through purchase of an apartment it would be possible for them to occupy the apartment at the time they are required in the city. Furthermore, the four had work commitments that differed from each other’s in addition to the option of having an apartment having the advantage of building up of equity in the asset at the same time. They agreed to go for an apartment that had the highest overall value of their money at would present ease of use for the four of them. So the problem to be solved was choosing an apartment that is suitable for each of them. This problem is appropriate for use of MCDA in finding appropriate solution, since it would give a sensible as well as logical framework for determination of the outstanding apartment. The possible apartments are the range of alternatives with a set criteria being used in development of a variety of resources (hard data) while the perspectives and intuition of the four would comprise of the soft data. With it being concluded that MCDA is the right route to be taken, the next move is the restructuring of the problem with so that a set alternatives can be developed to have criteria tree hierarchy (Belton, 1990). There are several ways of criteria identification, with the purpose of identification being coming up with hierarchical tree also referred to as value tree and also developing ways for testing and comparing the alternatives (Daellenbach, 1994). Through brainstorming as an individual or group, a wide set of criteria is generated, and this is possible regardless of the set of alternatives having been established or not. Figure 1: Criteria tree After making a decision that the use of MCDA is appropriate the next step is to do analysis of the situation. The situation presented need several pre-emptive criteria so as for the alternatives to be screened out. The criteria to be used include The price of the house should not go beyond $250000 The apartment should be located at inner-city with the distance from the furthest work place should not go beyond 10 minutes There were further criteria to be used in picking the house alternatives that met the initial criteria where there is consideration of the following factors Need to have a balcony so as to enjoy beautiful weather and the need to have wide doors that leads to the balcony allowing the circulation of fresh air in the apartment The apartment should have one to two bedrooms There is need for the apartment to be fully or semi-furnished as its use is immediate It is important for the apartment to have morning and/or afternoon sun for intrinsic purposes and to make it more welcoming. The afternoon sun would be preferred bearing in mind that most mornings are to be spend at work It is important that amenities are to be close to the apartment With the pre-emptive criteria already identified together with a list of desirable criteria, it would be the turn to go out and research so as to come up with apartment alternatives which would conform to pre-emptive criteria as well as meeting the desired criteria (Goodwin, 1998). The following are the description of apartment put into consideration Scoring stage Through analysis of the raw data, it is determined on how each of the criteria is to be scored with scored being classified as either local or global as can be seen below: The purchase price is considered to be a global scale and it determined by dividing the alternative price by the highest price and then multiplying by 100 Body Corp fee is considered as Global-local scale and is given by (Fee for alternative/the highest fee)x100 Size is considered as local scale and is given by (Size of the apartment in question-smallest size)/Largest size apart.-smallest size apart) Furnishing is a local scale and is given by: None-0, Semi-50 Full-100 Location is a local scale given as: Fringe- 0, Inner-50, Central-100. Added features are on a global scale given by: Balcony – 35 Morning sun 15, Afternoon sun 25, Tenants ( Read More