A MODIFIED ANALYTIC HIERARCHYAPPROACH IN RANKING HUMAN-CAPITAL INDICATORS

Abstract

Evaluation on human-capital development and a knowledge-based economy becomes increasingly important as several approaches have been proposed. One of the popular methods in multi-criteria evaluation is the pair-wise comparison ofAnalytic Hierarchy Process (AHP). However, single evaluation in pair-wise comparison of AHP seems not very comprehensive in handling of human judgement. Therefore, this study aims to propose a modified analytical-hierarchy process by considering two-sided conflicting judgement and test the proposed approach to ranking indicators of human capital in Malaysian organisations. The theory of Conflicting Bi:fuzzy Sets (CBFS) was hybridised into AHP to form a modified version of decision-making tool that employed linguistic judgement and pair-wise comparison. The modified approach was employed to integrate the multifacets preferences offive criteria ofhuman capital in establishing the importance ofthe four identified indicators. A case study ofhuman-capital measurement is presented and the proposed model is applied to facilitate the decision-making process. Interviews with three decision-makers were administered to collect linguistic data over the comparative judgement of human-capital measures in Malaysia. The results show that succession rate oftraining programmes is the most important measurement indicator and creating result by using knowledge is the least-important measurement indicator. The overall ranking reflects the importance ofmeasurement indicators in steering Malaysia to become a worthy human-capital investment.