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Technique For Order Preference by Similarity To Ideal Solution (Topsis)

TOPSIS (Technique for Order Preference by Similarity to Ideal Solution) is a multi-criteria decision making method that chooses the alternative that is closest to the ideal solution and farthest from the negative ideal solution. It involves calculating the distance of each alternative from the ideal positive and negative ideal alternatives. The alternative with the shortest distance from the ideal and farthest from the negative ideal is selected as the best option. The method normalizes the decision matrix, determines the weighted normalized matrix, identifies the ideal and negative ideal solutions, calculates the separation measures from each solution, and then computes the relative closeness to the ideal solution to rank the alternatives.

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98 views

Technique For Order Preference by Similarity To Ideal Solution (Topsis)

TOPSIS (Technique for Order Preference by Similarity to Ideal Solution) is a multi-criteria decision making method that chooses the alternative that is closest to the ideal solution and farthest from the negative ideal solution. It involves calculating the distance of each alternative from the ideal positive and negative ideal alternatives. The alternative with the shortest distance from the ideal and farthest from the negative ideal is selected as the best option. The method normalizes the decision matrix, determines the weighted normalized matrix, identifies the ideal and negative ideal solutions, calculates the separation measures from each solution, and then computes the relative closeness to the ideal solution to rank the alternatives.

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HK M
Copyright
© © All Rights Reserved
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TOPSIS

TECHNIQUE FOR ORDER


PREFERENCE BY
SIMILARITY TO IDEAL
SOLUTION (TOPSIS)

Indian Institute of Management (IIM),Rohtak


Multi-Criteria Decision
Making

TOPSIS METHOD

Indian Institute of Management (IIM),Rohtak


TOPSIS, known as one of the most
classical MCDM methods, was first
developed by Hwang and Yoon , is based
on the idea that the chosen alternative
should have the shortest distance from the
Positive Ideal Solution (PIS) and on the
other side the farthest distance of the
Negative Ideal Solution (NIS).

Indian Institute of Management (IIM),Rohtak


TOPSIS METHOD
• Technique of Order Preference by
Similarity to Ideal Solution
• This method considers three types of
attributes or criteria

– Qualitative benefit attributes/criteria


– Quantitative benefit attributes
– Cost attributes or criteria

Indian Institute of Management (IIM),Rohtak


TOPSIS METHOD
• In this method two artificial alternatives are
hypothesized:
• Ideal alternative: the one which has the best level for all
attributes considered.
• Negative ideal alternative: the one which has the worst
attribute values.

• TOPSIS selects the alternative that is the closest to the


ideal solution and farthest from negative ideal
alternative.

Indian Institute of Management (IIM),Rohtak


Input to TOPSIS
• TOPSIS assumes that we have m alternatives
(options) and n attributes/criteria and we have the
score of each option with respect to each criterion.

• Let xij score of option i with respect to criterion j


We have a matrix X = (xij) mn matrix.
• Let J be the set of benefit attributes or criteria
(more is better)
• Let J' be the set of negative attributes or criteria
(less is better)
Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS
• Step 1: Construct normalized decision matrix.
• This step transforms various attribute dimensions
into non-dimensional attributes, which allows
comparisons across criteria.

• Normalize scores or data as follows:

rij = xij/ sqrt(x2ij) for i = 1, …, m; j = 1, …, n

7
Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS
• Step 2: Construct the weighted normalized
decision matrix.
• Assume we have a set of weights for each
criteria wj for j = 1,…n.
• Multiply each column of the normalized
decision matrix by its associated weight.
• An element of the new matrix is:

vij = wj rij
8
Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS
• Step 3: Determine the ideal and negative
ideal solutions.
• Ideal solution.
A* = { v1* , …, vn*}, where
vj* ={ max (vij) if j  J ; min (vij) if j  J' }
• Negative ideal solution.
A' = { v1' , …, vn' }, where
v' = { min (vij) if j  J ; max (vij) if j  J' }

Indian Institute of Management (IIM),Rohtak


Steps of TOPSIS
• Step 4: Calculate the separation measures
for each alternative.

• The separation from the ideal alternative is:


Si * = [  (vj*– vij)2 ] ½ i = 1, …, m
j

• Similarly, the separation from the negative


ideal alternative is:
S'i = [  (vj' – vij)2 ] ½ i = 1, …, m
j

Indian Institute of Management (IIM),Rohtak


Steps of TOPSIS

• Step 5: Calculate the relative closeness to


the ideal solution Ci*

Ci* = S'i / (Si* +S'i ) , 0  C i*  1

11
Indian Institute of Management (IIM),Rohtak
Applying TOPSIS Method to
Example
Weight 0.1 0.4 0.3 0.2
Style Reliability Fuel Eco. Cost

Civic 7 9 9 8

Saturn 8 7 8 7

Ford 9 6 8 9

Mazda 6 7 8 6

Indian Institute of Management (IIM),Rohtak


Applying TOPSIS to Example

• m = 4 alternatives (car models)


• n = 4 attributes/criteria
• xij = score of option i with respect to criterion j
X = {xij} 44 score matrix.
• J = set of benefit attributes: style, reliability, fuel
economy (more is better)
• J' = set of negative attributes: cost (less is better)

13
Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS

• Step 1(a): calculate (x2ij )1/2 for each column


Style Rel. Fuel Cost
Civic 49 81 81 64

Saturn 64 49 64 49

Ford 81 36 64 81

Mazda 36 49 64 36
xij2 230 215 273 230

(x2)1/2 15.17 14.66 16.52 15.17


Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS

• Step 1 (b): divide each column by (x2ij )1/2


to get rij
Style Rel. Fuel Cost
Civic 0.46 0.61 0.54 0.53

Saturn 0.53 0.48 0.48 0.46 Rij = 7/15.17 = .46

Ford 0.59 0.41 0.48 0.59

Mazda 0.40 0.48 0.48 0.40


Weight 0.1 0.4 0.3 0.2
Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS
• Step 2 (b): multiply each column by wj to get vij.

Style Rel. Fuel Cost


Civic 0.046 0.244 0.162 0.106

Saturn 0.053 0.192 0.144 0.092

Ford 0.059 0.164 0.144 0.118

Mazda 0.040 0.192 0.144 0.080

Indian Institute of Management (IIM),Rohtak


Steps of TOPSIS
• Step 3 (a): determine ideal solution A*.
A* = {0.059, 0.244, 0.162, 0.080}
vj* ={ max (vij) if j  J ; min (vij) if j  J' }

Style Rel. Fuel Cost


Civic 0.046 0.244 0.162 0.106

Saturn 0.053 0.192 0.144 0.092

Ford 0.059 0.164 0.144 0.118

Mazda 0.040 0.192 0.144 0.080

Indian Institute of Management (IIM),Rohtak


Steps of TOPSIS
• Step 3 (a): find negative ideal solution A'.
A' = {0.040, 0.164, 0.144, 0.118}
v' = { min (vij) if j  J ; max (vij) if j  J' }

Style Rel. Fuel Cost


Civic 0.046 0.244 0.162 0.106

Saturn 0.053 0.192 0.144 0.092

Ford 0.059 0.164 0.144 0.118

Mazda 0.040 0.192 0.144 0.080


Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS

• Step 4 (a): determine separation from ideal


solution A* = {0.059, 0.244, 0.162, 0.080}
Si* = [  (vij– v*)2 ] ½ for each row
Style Rel. Fuel Cost
Civic (.046-.059)2 (.244-.244)2 (0)2 (.026)2

Saturn (.053-.059)2 (.192-.244)2 (-.018)2 (.012)2

Ford (.053-.059)2 (.164-.244)2 (-.018)2 (.038)2


Mazda (.053-.059)2 (.192-.244)2 (-.018)2 (.0)2
Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS
• Step 4 (a): determine separation from ideal
solution Si*

(vij–v*)2 Si* = [  (vij– v*)2 ] ½

Civic 0.000845 0.029

Saturn 0.003208 0.057

Ford 0.008186 0.090

Mazda 0.003389 0.058

Indian Institute of Management (IIM),Rohtak


Steps of TOPSIS

• Step 4 (b): find separation from negative ideal


solution A' = {0.040, 0.164, 0.144, 0.118}
Si' = [  (vij– v')2 ] ½ for each row

Style Rel. Fuel Cost


Civic (.046-.040)2 (.244-.164)2 (.018)2 (-.012)2

Saturn (.053-.040)2 (.192-.164)2 (0)2 (-.026)2

Ford (.053-.040)2 (.164-.164)2 (0)2 (0)2


Mazda (.053-.040)2 (.192-.164)2 (0)2 (-.038)2
Indian Institute of Management (IIM),Rohtak
Steps of TOPSIS

• Step 4 (b): determine separation from


negative ideal solution Si'

(vij–v')2 Si' = [  (vij– v')2 ] ½

Civic 0.006904 0.083

Saturn 0.001629 0.040

Ford 0.000361 0.019

Mazda 0.002228 0.047

Indian Institute of Management (IIM),Rohtak


Steps of TOPSIS

• Step 5: Calculate the relative closeness to


the ideal solution Ci* = S'i / (Si* +S'i )

S'i /(Si*+S'i) Ci*


Civic 0.083/0.112 0.74  BEST

Saturn 0.040/0.097 0.41

Ford 0.019/0.109 0.17

Mazda 0.047/0.105 0.45

Indian Institute of Management (IIM),Rohtak


Practices ?

Indian Institute of Management (IIM),Rohtak


Practice ?

Indian Institute of Management (IIM),Rohtak


Sol

Indian Institute of Management (IIM),Rohtak


sol

Indian Institute of Management (IIM),Rohtak


sol

Indian Institute of Management (IIM),Rohtak


sol

Indian Institute of Management (IIM),Rohtak


sol

Indian Institute of Management (IIM),Rohtak


END

Indian Institute of Management (IIM),Rohtak

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