A Fuzzy-AHP Approach to Solve Multi Criteria Budget Allocation Problem

Decision-making problems require systematic approach to evaluate alternatives using both quantitative and non-quantitative factors. Standard methods to solve problems lack considerations of non-quantitative factors, in which numeric value is difficult to assign. Different techniques like Fuzzy set theory, Analytic Hierarchy Process (AHP) and Multi Criteria Decision Making (MCDM) are presently being used in decision-making process. These techniques take multiple factors with vague values and /or concrete values. This paper provides solution to a decision-making problem of budget allocation problem, to allocate funds to deserving and competing organizations by using integrated Fuzzy, AHP and MCDM techniques. In budget allocation problem, fund seekers submit their proposals to avail funds to fund allocator to execute their projects. Fund allocators allocate funds to fund seekers after evaluating their proposals. During evaluation, 12 decisionmaking factors are considered and these are given weights. Weights are calculated using Fuzzy set theory and AHP. Fuzzy set takes subjective values like preferred, strongly preferred etc. and AHP technique evaluates relative importance of factors by forming pairwise comparison matrix. Experts in this domain were consulted to give their preferences through questionnaire. The technique of evaluating proposals helped in ranking after assigning weights to decision-making factors.