Title: Application of the fuzzy analytic hierarchy process to the lead-free equipment selection decision

Authors: Yu-Cheng Tang, Thomas W. Lin

Addresses: Department of Accounting, National Changhua University of Education, No. 2, Shi-Da Road, Changhua 500, Taiwan. ' Leventhal School of Accounting, University of Southern California, 3660 Trousdale Parkway, ACC 109, Los Angeles, CA 90089-0441, USA

Abstract: After 1 July 2006, a major challenge that the manufacturing industry has to confront now is the effect of the lead-free equipment system selection process on companies| capital expenditure decision. With capital investment, the criteria may be financial (e.g. expected cash flows) and non-financial (e.g. product quality). We use a systems approach with the fuzzy analytic hierarchy process (FAHP) method as the decision support system to help decision makers making better choices both in relation to tangible criteria and intangible criteria. Fuzzy set theory will be utilised to provide an effective way of dealing with the uncertainty of human subjective interpretation of tangible and intangible criteria.

Keywords: multicriteria decision making; MCDM; capital investment; lead-free equipment; fuzzy analytical hierarchy process; fuzzy AHP; uncertainty; imprecision; fuzzy synthetic extent; sensitivity analysis; selection decisions; manufacturing industry; capital expenditure; decision making; financial criteria; expected cash flows; non-financial criteria; product quality; decision support systems; choice; tangible criteria; intangible criteria; fuzzy set theory; human interpretation; subjective interpretation; hazardous substances; European Union; Taiwan; restrictions; EU Directive; business; systems research.

DOI: 10.1504/IJBSR.2011.037289

International Journal of Business and Systems Research, 2011 Vol.5 No.1, pp.35 - 56

Published online: 17 Apr 2015 *

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