# THE ANALYTIC NETWORK PROCESS Dependence And Feedback In Decision

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```					                         MCDM 2004, Whistler, B. C., Canada, August 6-11, 2004

THE ANALYTIC NETWORK PROCESS
Dependence And Feedback In Decision Making
(Part 1) Theory And Validation Examples

Thomas L. Saaty
University of Pittsburgh
Pittsburgh, Pennsylvania, USA
mailto:saaty@katz.pitt.edu

Keywords: analytic network process, analytic hierarchy process

ABSTRACT

The Analytic Network Process (ANP) is a multicriteria theory of measurement used to derive relative
priority scales of absolute numbers from individual judgments (or from actual measurements normalized to
a relative form) that also belong to a fundamental scale of absolute numbers. These judgments represent
the relative influence, of one of two elements over the second on a third element in the system, in a
pairwise comparison process with respect to an underlying criterion. Through its supermatrix whose
entries are themselves matrices of column priorities, the ANP synthesizes the outcome of dependence and
feedback within and between clusters of elements.

The Analytic Hierarchy Process (AHP) with its independence assumptions on upper levels from lower
levels and the independence of the elements within a level is a special case of the ANP. Systemic thinking
is essential in decision making to represent decisions in the framework of a network. The ANP is a way to
implement this type of thinking. One had to overcome the limitation of linear hierarchic structures and the
requirement that scales can be added and multiplied to deal with dependence and feedback using
judgments about importance and preference along with, for example, measurements in the form of
likelihood as probability.

In addition the general theory of the ANP enables one to deal with the benefits, opportunities , costs, and
risks (the BOCR merits) of a decision, by introducing the notion of negative priorities for C and R along
with the rating of the top rated alternative for each of these four merits in terms of strategic criteria to
enable one to combine the four values of each alternative into a single outcome. This paper summarizes
and illustrates the basic concepts of the ANP and shows how informed intuitive judgments can lead to real
life answers that are matched by actual measurements in the real world.

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