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  • 7/30/2019 A HYBRID BUSINESS STRATEGY SELECTION PROCESS FOR A TEXTILE COMPANY USING SWOT AND FUZZY ANPA CA

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    International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976

    6510(Online), Volume 3, Issue 2, May-August (2012)

    A HYBRID BUSINESS STRATEGY SELECTION PROCESS FOR A

    TEXTILE COMPANY USING SWOT AND FUZZY ANPA CASE

    STUDY

    K.L. Jeyaraj*,a

    , C. Muralidharanb, T. Senthilvelan

    cand S.G. Deshmukh

    d

    aDepartment of Manufacturing Engineering, Annamalai University,Chidambaram608002, TamilNadu, India.Email: [email protected]

    bDepartment of Manufacturing Engineering, Annamalai University,Chidambaram608002, TamilNadu, India.

    cDepartment of Mechanical Engineering, Pondicherry Engineering College,Pondicherry605014, India.

    dDepartment of Mechanical Engineering, Indian Institute of Technology Delhi, New Delhi110016, India.

    AbstractMany companies are conducting a SWOT analysis as part of their strategic planning. This is

    the process to identify the strengths (S), weaknesses (W), opportunities (O) and threats (T)

    before proceeding to the formulation of their long and short term strategy. This work initiates

    with the formation of SWOT matrix, which contains the SWOT factors, sub-factor and

    strategies. To ensure the successful implementation of the best strategy, here raises a critical

    issue of how firms can better evaluate and select a best strategy before implementation. A

    framework is proposed to address the inner dependence relations of SWOT factors and sub-

    factors with the aid of analytical network process (ANP). The results obtained through the

    proposed approach are more objective and unbiased due to two reasons. Firstly, the results

    are generated by decision makers in the presence of multiple criteria. Secondly, the fuzzy

    linguistic approach employed has more advantage to reduce distortion and losing of

    information. An empirical study is presented to illustrate the application of the proposed

    approach. The ANP algorithm suggests to implement and optimize an innovative process

    (Colour Fast FinishCFF) to reduce water, power, fuel and effluent load (ST1). Finally this

    article concludes with the force field analysis which will provide the guidelines for the

    implementation of selected strategy.

    Key words: SWOT analysis, strategic planning, Fuzzy ANP, Force field analysis.

    1.0 An Overview of Indian Textile Industry

    The textile industry in India plays a pivotal role through its contribution to industrial output,

    employment generation, and the export earnings of the country. It contributes about 14 per

    cent to industrial production, 4 percent to the GDP, and 16.63 percent to the country's export

    earnings. It would provide direct employment to over 35 million people by 2010 to 2011

    (Texmin, 2005). Thus, the growth and all round development of this industry has a direct

    INTERNATIONAL JOURNAL OF MANAGEMENT (IJM)

    ISSN 0976 6367(Print)ISSN 0976 6375(Online)

    Volume 3, Issue 2, May- August (2012), pp. 124-143

    IAEME: www.iaeme.com/ijm.html

    Journal Impact Factor (2011): 1.5030 (Calculated by GISI)

    www.jifactor.com

    IJM I A E M E

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    International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976

    6510(Online), Volume 3, Issue 2, May-August (2012)

    bearing on the improvement of the economy of the nation. In Indias current scenario, textile

    industry is facing more challenges (cotton and yarn price fluctuation, effluent treatment and

    discharge, customer expectation on high quality and disposal of solid waste) from all the

    areas of business. For facing these challenges, organization has to plan their effective long

    and short range strategy. Before starting the strategic planning, the organization has to

    identify their internal capabilities and their competitive environment. SWOT analysis is oneof the self evaluating tools to measure the company internal capabilities and external

    competitive environment. This article concentrates the textile processing units business

    strategy selection of a leading textile company in south India. This company is having its

    entire value chain of textile process. Our research interest is the processing unit (dyeing and

    finishing) of that company.

    1.1 Introduction to SWOT Analysis

    Many companies are conducting a SWOT analysis as part of the strategic planning process to

    identify strengths, weaknesses, opportunities and threats before proceeding to the formulation

    of a strategy (Houben et al., 1999). SWOT analysis, meaning the analysis of key or

    critical success factors, belongs to the highest ranked set of techniques of strategic analysisused by firms in empirical surveys (Glaister and Falshaw, 1999). Most of literatures are

    covering the strategic planning process; most approaches include a cyclic iteration of the

    following five elements. (1) Strategic planning process begins with a statement of the

    corporate mission and goals. (2) Analysis of the organizations external competitive

    environment. (3) Analysis of the organizations internal operating environment. (4) Selection

    of focused organization strategies. (5) Implementation of the selected strategies. The last step

    also involves the design of the organizational structure and control systems necessary to

    implement the chosen strategy (Hax and Majluf, 1991). The focus of this article lies upon

    step 4, selection of the strategy which is best among the alternative strategies. (Weihrich,

    1982, 1999) modified SWOT (or TOWS) into the format of a matrix, matching the internal

    factors (i.e., the strengths and weaknesses) of an organization with its external factors (i.e.,

    opportunities and threats) to systematically generate responses that ought to be undertaken bythe organization. In many cases there is dependencies found among the external and internal

    factor effects. This dependency needs to be taken into account during the strategic planning

    (Yuksel and Dagdeviren, 2007). If it used properly, SWOT can provide a good basis for

    strategy formulation (Kajanus et al., 2004). However, SWOT analysis is having deficiencies

    in the measurement and evaluation steps (Hill and Westbrook, 1994, Christianson, 2002). In

    conventional SWOT analysis, the magnitude of the factors is not quantified to determine the

    effect of each factor on the proposed plan or strategy. In other words, SWOT analysis does

    not provide an analytical means to determine the relative importance of the factors, or the

    ability to assess the appropriateness of decision alternatives based on these factors (Kajanus

    et al., 2004). For this reason, SWOT analysis alone cannot comprehensively appraise the

    strategic decision-making process (Hill and Westbrook, 1994).

    1.2 Introduction to Analytical Network Process (ANP)

    Structuring of a decision problem with functional dependencies that allows for feedback

    among clusters is considered to be a network system. Saaty suggested the use of AHP to

    solve the problem of independence among alternatives or criteria, and the use of ANP to

    solve the problem of dependence among alternatives or criteria (Saaty, 1978). The ANP, also

    introduced by Saaty, is a generalization of the AHP (Chang and Huang, 2006). While the

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    AHP represents a framework with an un-directional hierarchical relationship, the ANP allows

    for complex interrelationships among decision levels and attributes. The ANP feedback

    approach replaces hierarchies with networks in which the relationships between levels are not

    easily represented as higher or lower, dominant or subordinate, direct or indirect. ANP can be

    described in the following steps (Chung et al., 2005): Step 1. Model construction and

    problem structuring, Step 2. Pair-wise comparison matrices and priority vectors, Step 3.Supermatrix formation and Step 4. Selection of the best alternatives. A system with feedback

    (inner or outer dependence) can be represented by a network.

    1.2.1 Fuzzy Set theory for ANP

    Fuzzy set theory can express and handle vague or imprecise judgments mathematically. In

    fuzzy logic, each number between 0 and 1 indicates a partial truth, whereas crisp sets

    correspond to binary logic [ ]10, . Hence, fuzzy logic can express and handle vague orimprecise judgments mathematically (Al-Najjar and Alsyouf, 2003). In particular, to tackle

    the ambiguities involved in the process of linguistic estimation, it is a beneficial way to

    convert these linguistic terms into fuzzy numbers. This study builds on some important

    definitions and notations of fuzzy set theory and this has been given in Appendix 1. In orderto perform a pair wise comparison among the parameters, a linguistic scale has been

    developed. The scale is depicted in Figure 1 and the corresponding explanations are provided

    in Table 1.

    Figure 1. Triangular fuzzy membership function and fuzzy number N~

    Table 1. Linguistic variables and fuzzy numbers for the importance weight

    Linguistic

    scaleExplanation

    Fuzzy

    numbers

    The inverse of

    fuzzy numbers

    Equal

    Importance

    Two activities contribute equally to the

    objective(1,1,1) (1,1,1)

    ModerateImportance Experience and judgment slightly favor oneactivity over another (1,3,5) (1/5,1/3,1)

    Strong

    Importance

    Experience and judgment strongly favor one

    activity over another(3,5,7) (1/7,1/5,1/3)

    Very strong

    Importance

    An activity is favored very strongly over

    another; its dominance demonstrated in practice(5,7,9) (1/9,1/7,1/9)

    Demonstrated

    ImportanceThe evidence favoring one activity over another

    is highest possible order of affirmation(7,9,11) (1/11,1/9,1/7)

    1 2 3 4 5 6 7 8 9 11 l m u X

    (x)~N

    0

    1

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    The main objectives of this paper are to:

    Form the SWOT matrix of a textile company. Build the hierarchy and network model of the SWOT matrix. Create complete inner dependence relationship of network model. Incorporate fuzziness in pairwise comparison matrix to eliminate the datavagueness and Create super matrix. Find the best strategy for the textile company. Force field analysis of the selected strategy.

    This paper is organized as follows: The literature review is presented followed by the

    methodology used for the study with a case of a textile company is given. A step by step

    approach to select the best strategy is given based on fuzzy ANP. Finally this article

    concludes with the force field analysis which will provide the guideline to the

    implementation of selected strategy.

    2.0 Literature reviewThe following are the review of literatures on SWOT analysis in the area of textile sector. Sandeep

    and Goswami, (2007), have applied SWOT analysis in Indian handmade carpets industry and made aSWOT matrix. The SWOT analysis confirmed that engaging handmade carpet work produces gainfulemployment resulting socio-economic growth. Ramesh (2006) applied SWOT analysis of garment

    industry and analyzed the barriers in the garment exporters in district Salem, India. In his article,SWOT analysis is used to determine the textile companys long and short range strategic planning.Dadashian et al., (2007) have applied AHP for developing the balanced scorecard on an alliance-making of eight textile companies. The work has been conducted as a qualitative case study at thetextile firms in Isfahan. But the selected factors for study are assumed to have no inner dependence

    between them. Hussain et al., (2009) have made a study to identify internal and external factors

    relevant to textile and clothing supply chain in Pakistan using SWOT-AHP / ANP analysis. The

    identified factors played an important role in the development of strategies which are useful for

    improving the competitiveness of the chain. AHP and ANP were used to find the potential strategy.But in their paper the authors dealt only the 1

    stlevel of inner dependence of the SWOT main factors.

    The sub factors inner dependence is not accounted. Hussain et al., (2010) have focused to examine the

    potential of different strategies formulated by experts on Pakistans textile and clothing supply chaincase. The intension was to formulate a decision structure based on external view of the chain and with

    more generalized criteria based on SWOT AHP / ANP. The inner dependence between the sub-factors is not considered even in their study. Hussain et al., (2011) have made a future opportunity

    based planning analysis for Pakistans textile and clothing supply chain case. They have formed amethodology for developing a planninglink between chain entities and opportunities based on

    SWOT ANP, assuming sub-factors as independent. Rezaie et al., (2010) have made a novel

    systematic method to obtain the most proper organizational safety strategies in a textile company in

    Iran by utilizing SWOT concepts. Yuksel and Dagdeviren, (2007) have applied the strategic decision

    making SWOT ANP analysis for a textile company. Their paper demonstrated the process for

    quantitative SWOT analysis when there is dependence among strategic factors. In this study a

    complete inner dependency analysis with ANP is suggested with a textile company case. SWOT mainfactor and SWOT sub factors inner dependence is measured and incorporated for strategy selection. Anew approach of network interdependence and super matrix is constructed. More over, the literatures

    show that researchers have not considered the vagueness in the decision makers impreciseness inSWOT AHP / ANP pair wise comparison matrix. To eliminate the data vagueness in this study,

    fuzzy set theory is used as an improvement process from the existing study.

    3.0 MethodologyThe proposed methodology is given as a flow chat (Figure 2), which starts from SWOT matrix. For

    selection of the best strategy from the SWOT matrix, the proposed Fuzzy ANP algorithm is as

    follows:

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    Step 1: Identify SWOT sub-factors, determine the alternative strategies according to SWOT sub-

    factors and form the SWOT matrix. Table 2 shows the textile companys key internal and external

    strategy for business improvement. Internal strength and weakness variables, external opportunity and

    threat variables are also given in Table 2 to plan the strategies. This matrix is developed based on thequantitative analysis of each SWOT factors and sub-factors. The thirty three SWOT sub-factors are

    identified based on the prior experience of the researcher, from literature and also with the help of

    brainstorming method. The same is made as rating type questionnaire. All the thirty threequestionnaires are evaluated in qualitative nature. The questionnaires are surveyed by interview(Edward, 2002 and Gorsuch, 1983) through all the (125 no) staff members in top management,

    managerial level and supervisory level of the company (Jeyaraj et al., 2011). The results of the

    matching are listed in the four separate quadrants (i.e. MaxiMaxi SO; MiniMaxi WO; MaxiMini

    ST and MiniMini WT strategies).

    Figure 2. Flow chart for the methodology used

    Formation of SWOT matrix

    Problem structure and construction of

    hierarchy model

    Construction of network model and

    inner dependence model

    Pair wise comparison matrices

    Formation of supermatrix

    Selection of best strategy

    Force filed analysis

    For matching external and

    internal SWOT factors for

    strategy building

    To classify SWOT

    factors, sub factors and

    alternate strategies with

    a linka e

    To study the inner

    dependence between the

    SWOT factors and sub

    factors

    To find the importanceweight of factors, sub

    factors and alternatives.

    Also to find the inner

    dependence weight

    A matrix format to

    incorporate inner

    dependence to the

    factor wei hts

    Selection of best

    strategy based on ANP

    weight-age

    To analyze the positive

    negative environment to

    implementation of the

    selected strate

    Entire ANP

    activity

    Fuzzy ANP

    activity

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    Table 2. SWOT matrix of the textile company

    SWOT

    Internal Strength Internal weakness

    1. (C6S) Raw material supply 1. (C12W) Operatives fatigue

    2. (C4S) Low labour cost 2. (C15 W) Fragmented company3. (C1S) Mass production setup 3. (C11W) Textile engineering Skills

    4. (C2S) Cost conscious business 4. (C13 W) Effluent treatment capacities

    5. (C5S) Capital investment

    availability5. (C14W) Availability of water

    6. (C3S) Strong R & D for dyeing and

    finishing6. (C10W) Work environment

    External Opportunity Maxi - Maxi (SO strategy) Mini - Maxi (WO strategy)

    1. (C18O)Market orders Exports / Locals

    (SO1) Production and ETP line

    balancing, can be achieved by

    changing product mix and production

    plan

    (WO1) Implementation of OHASAS

    and EMS

    2. (C19O) Marine discharge facility (SO2) Development of own retail

    market across the south India

    3. (C20O) Technical textile(SO3) Production and ETP line

    balancing

    4. (C21O) New developments in dyes,

    pigments and chemicals

    External Threat Maxi - Mini (ST strategy) Mini - Mini (WT strategy)

    1. (C30T) High water consumption /

    effluent generation

    (ST1) Implement and optimize an

    innovative process (Colour Fast Finish

    - CFF) to reduce water, power, fuel

    and effluent load

    (WT1) Time and motion study and

    implementation

    2. (C26T) Product lead time

    (ST2) Capacity improvement of power

    generation by own generation or from

    3rd party or from wind mills

    (WT2) Ergonomics study and

    implementation

    3. (C31T) Disposal of solid waste

    generated from effluent

    (ST3) Capacity improvement of steam

    generation by install new boiler units

    (WT3) Training and skill development

    campaign in production and services

    for production

    4. (C29T) Availability of electrical

    power

    (ST4) Production, lead time and

    quality improvement through TPM

    and TQM

    (WT4) Re locate and integration of the

    value chain of the company by

    considering the cost benefit

    5. (C25T) Availability fuel for steam

    generation(ST5) Implementation of SA 8000

    6. (C24T) Ecological product requirement

    7. (C28T) Social awareness

    8. (C27T) Market competition

    Step 2: Specify the problem structure of the SWOT matrix and the hierarchical representation of the

    SWOT matrix. The problem is transformed into a hierarchical structure, as suggested by Saaty and

    Mariya, (2008), for decision making. The proposed hierarchical model structure is constructed using

    the Web-HIPRE1

    software and it is presented here in Figure 3. The overall problem consists of the

    goal, Determining Best Strategy which is based on four factors: strengths, weaknesses,opportunities and threats (Yuksel and Dagdeviren, 2007). These factors are further added with sub

    factors of relevant importance to the chain and included six strengths, six weaknesses, four

    opportunities and eight threats. Linking the goal with the factors and sub-factors, thirteen strategies

    are suggested which may have potential contributions in a textile company strategic planning.

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    Step 3: Construct the network of the SWOT model and inner dependence among the SWOT factorsand SWOT sub-factors. The hierarchy and network model proposed in this study for SWOT analysis

    is composed of four levels, as shown in Figure 4.

    Figure 3. Hierarchical model for determining the best strategy of a textile company

    Figure 4. Hierarchy and network representation of SWOT model

    Alternative

    (b) The network of SWOT model

    S W O T

    factors

    Goal

    Criteria

    Sub

    Criteria

    BestStrategy

    S W O T

    sub-factors

    Alternate

    Strategy

    Alternative

    S W O T

    factors

    Goal

    Criteria

    Sub

    Criteria

    BestStrategy

    S W O T

    sub-factors

    Alternate

    Strategy

    Inner

    dependence

    Inner

    dependence(w21)

    (w32)

    (W43)

    (w1)

    (W2)

    (w3)(W4)

    (W5)

    (a) The hierarchy of SWOT model

    Cluster

    Element

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    The goal (best strategy) is indicated in the first level, the criteria (SWOT factors) and sub-

    criteria (SWOT sub-factors) are found in the second and third levels respectively, and the last

    level is composed of the alternatives (alternative strategies). The supermatrix of a SWOT

    hierarchy with four levels is as follows:

    =

    IW

    w

    w

    esAlternativ

    factorsSWOT sub rsSWOT facto

    Goal

    W

    43

    32

    21

    00

    000

    000

    0000

    (12)

    Where w21 is a vector which represents the impact of the goal on the criteria, w32 is a matrix

    that represents the impact of the criteria on each of the sub-criteria, W43 is a matrix that

    represents the impact of the sub-criteria on each of the alternatives, and I is an identity

    matrix. A hierarchical representation of the SWOT model is given in Figure 4a and its

    general network representation is presented in Figure 4b. The network model (Figure 4b)

    illustrates the case of a hierarchy with inner dependence within clusters but without feedback.

    SWOT factors, sub-factors and strategies are used in place of criteria, sub-criteria and

    alternatives respectively in Figure 4b. The SWOT factors and sub-factors have inner

    dependencies with in their clusters. A network can be organized to include source clusters,

    intermediate clusters and sink clusters. Relationships in a network are represented by arcs,where the directions of arcs signify directional dependence (Chung et al., 2005).

    Interdependency between two clusters, termed outer dependence, is represented by a two-way

    arrow. Inner dependencies among the elements of a cluster are represented by looped arcs

    (Chung et al., 2005). The letters in brackets in Figure 4b represents the relationship that will

    be signified by sub-matrices for supermatrix evaluation. Based on the schematic

    representation of Figure 4b, the general sub-matrix notation for the SWOT model used in this

    study is as follows:

    =

    IW

    Ww

    Ww

    esAlternativ

    factorsSWOT sub

    rsSWOT facto

    Goal

    W

    5

    43

    21

    00

    00

    00

    0000

    (13)

    Where, w1 is a vector that represents the impact of the goal, namely, selecting the best

    strategy according to SWOT factors. The W2 is a matrix that represents the inner dependence

    of the SWOT factors. The w3 is a vector that denotes the impact of the SWOT factor on each

    of the SWOT sub-factors. The W4 is a matrix that represents the inner dependence of the

    SWOT sub-factors and W5 is a matrix that denotes the impact of the SWOT sub-factors on

    each of the alternative strategies. Using matrix operations is preferred in order to show the

    details of the calculations in this algorithm.

    Step 4: Assume that there is no dependence among the SWOT factors; determine the

    importance degrees of the SWOT factors with a 5 point linguistic scale (i.e. calculate w1).

    Expert team of six key staff members of the company (with author) constructed the inner

    dependence models for factors and sub-factors. The expert team has selected the pairwise

    importance, inner dependence through fuzzy linguistic scale. Saaty and Mariya (2008) haveemphasized maintaining the consistency ratio below 0.1 when constructing the comparison

    matrices of orders larger than 55. In this study for all comparison matrices, the consistency

    ratio is calculated based on fuzzy preference ratio method (Modarres et al., 2010).The

    pairwise comparison matrix for the SWOT factors with respect to the best strategy (goal) is

    constructed first (Table 3).

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    Table 3. Pairwise comparison of SWOT factors for the selection of best strategy

    Best Strategy Strength Weakness Opportunity ThreatImportance weight of

    SWOT factors

    Strength (1,1,1) (3,5,7) (1,3,5) (1,1,1) 0.343

    Weakness (1/7,1/5,1/3) (1,1,1) (1,1,1) (1/9,1/7,1/5) 0.082

    Opportunity (1/5,1/3,1) (1,1,1) (1,1,1) (1/7,1/5,1/3) 0.094

    Threat (1,1,1) (5,7,9) (3,5,7) (1,1,1) 0.480(CR 0.07)The importance weight of SWOT factors is calculated by the equation 5 to 10 (Appendix 1).

    The matrix w1 is the importance weight of the SWOT factors from Table 3.

    Step 5: Determine with a 5 point linguistic scale, the inner dependence matrix of each SWOT

    factor with respect to the other factors by using the schematic representation (Figure 5a) of

    inner dependence among the SWOT factors (i.e. calculate W2). To calculate the inner

    dependence in SWOT factors, the inner dependence model presented in Figure 5a is

    followed. The inner dependence comparison matrices of SWOT factors are presented in

    Tables 4 through Table 6. The relative importance weight of SWOT factors inner

    dependence matrix is calculated by the equation 5 to 10 (Appendix 1). As SWOT factor

    opportunity is affected only by the strength, so no pairwise comparison matrix is formed with

    respect to opportunity. The comparison matrix (W2) of inner dependences of SWOT factors isconstructed as follows. Initially 4 4 identity matrix is made. The four rows and columns are

    strength, weakness, opportunity and threat. The first column (strength) is filled with relative

    importance weight from Table 4. The second column (weakness) is filled with the relative

    importance weight from Table 5. The third column (opportunity) is filled with zero except

    strength row, since it is dependent only with strength which is filled by value one (Figure 5a).

    The fourth column is filled with relative importance weight from Table 6.

    Table 4. Inner dependence of SWOT factors with respect to strength

    Strength Weakness Opportunity ThreatRelative importance weight

    of SWOT factors

    Weakness (1,1,1) (1,1,1) (1/9,1/7,1/5) 0.124

    Opportunity (1,1,1) (1,1,1) (1/7,1/5,1/3) 0.129Threat (5,7,9) (3,5,7) (1,1,1) 0.748

    (CR 0.051)

    Table 5. Inner dependence of SWOT factors with respect to weakness

    Weakness Strength ThreatRelative importance weight of

    SWOT factors

    Strength (1,1,1) (1/5,1/3,1) 0.274

    Threat (1,3,5) (1,1,1) 0.726

    (CR Not applicable)

    Table 6. Inner dependence of SWOT factors with respect to threat

    Threat Strength ThreatRelative importance weight of

    SWOT factors

    Strength (1,1,1) (1/5,1/3,1) 0.171

    Threat (1,3,5) (1,1,1) 0.829

    (CR Not applicable)

    The remaining unfilled references of W2 matrix are filled with zero. The matrix W2 is

    presented as follows:

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    =

    0001000072607480

    0000000100001290

    8290000000011240

    1710000127400001

    2

    ....

    ....

    ....

    ....

    W

    Step 6: Determine the inner dependence priorities of the SWOT factors (i.e. calculate wfactors

    = W2 w1). The (1st

    level) SWOT wfactors are local priority weights. These are the results of

    the normalized eigenvectors with considering the inner dependence. It can be explained as arelative grade of the SWOT factor group. If it is high for a factor, that will be high priority

    factor at local level. The matrix (Wfactors) of inner dependence priority of SWOT factors is

    calculated by multiplying w1 with W2 and normalized values of these weights are presented

    as follows:

    =

    =

    ==

    3980

    0690

    2610

    2710

    ;

    7990

    1390

    5220

    5420

    4800

    0940

    0820

    3430

    0001000072607480

    0000000100001290

    8290000000011240

    1710000127400001

    12

    .

    .

    .

    .

    W

    .

    .

    .

    .

    .

    .

    .

    .

    ....

    ....

    ....

    ....

    wWWd)(Normalize

    factorfactors

    Step 7: Assume that there is no inner dependence among the SWOT sub-factors; determine

    the importance degrees of the SWOT sub-factors with a 5 point linguistic scale given in

    Table 1 (i.e. calculate w3). The pairwise comparison matrices of SWOT sub-factors for local

    priority are constructed. SWOT strength category sub-factors pairwise comparison matrix is

    given in Table 7.

    Table 7. Pairwise comparison of strength - SWOT sub-factors for the local priority (CR 0.087)

    Strength C1S C2S C3S C4S C5S C6S Local weight

    C1S (1,1,1) (1,1,1) (3,5,7) (1,1,1) (1,3,5) (1/5,1/3,1) 0.166

    C2S (1,1,1) (1,1,1) (1,3,5) (1/5,1/3,1) (1,1,1) (1/7,1/5,1/3) 0.098

    C3S (1/7,1/5,1/3) (1/5,1/3,1) (1,1,1) (1/9,1/7,1/5) (1,1,1) (1/11,1/9,1/7) 0.044

    C4S (1,1,1) (1,3,5) (5,7,9) (1,1,1) (3,5,7) (1,1,1) 0.260

    C5S (1/5,1/3,1) (1,1,1) (1,1,1) (1/7,1/5,1/3) (1,1,1) (1/9,1/7,1/5) 0.056

    C6S (1,3,5) (3,5,7) (7,9,11) (1,1,1) (5,7,9) (1,1,1) 0.376

    The local weight of the SWOT sub-factors is calculated by the equations 5 to 10 (Appendix

    1). Similar to the Table 7, other three sub-factors category (weakness, opportunity and

    threat) pairwise comparison matrices for local priority are constructed and local weights have

    been calculated. The matrix w3 is the local weight of pairwise comparison of strength

    category SWOT sub-factors from Table 7.

    Step 8: Determine with a 5 point linguistic scale, the inner dependence matrix of each SWOT

    sub-factor with respect to the other sub-factors by using the schematic representation (Figure

    5b, 5c, 5d and 5e) of inner dependence among the SWOT sub-factors (i.e. calculate W 4).

    Similar to the SWOT factors inner dependence matrices (Table 5 to Table 7), SWOT sub-

    factors (strength, weakness, opportunity and threat) inner dependence matrices are formed

    and weights have been calculated. The comparison matrix (W4) of inner dependences of

    strength category SWOT sub-factors is constructed as follows. Initially 6 6 identity matrixis made. The six rows and columns are C1S to C6S. Each column of the matrix (W4) is filled

    with the relative importance of SWOT sub-factors local weight similar to matrix W2. The

    matrix W4 is presented as follows:

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    =

    000100000000775025007480

    000000010000000017800000

    000000000001000024900000

    059000000000000117801290

    423000010001116000011230

    517000000000109014400001

    W 4

    ......

    ......

    ......

    ......

    ......

    ......

    Similar to the strength category inner dependence comparison matrix, other categories

    (weakness, opportunity and threat) inner dependence comparison matrices are formed.

    Step 9: Determine the inner dependence priorities of the SWOT sub-factors (i.e. calculate

    wsub-factors (Local) = W4 w3). The (2nd

    level) SWOT wsub-factors (Local) are also local priority

    weights. These are the results of the normalized eigenvectors with considering the inner

    dependence. It can be explained as a relative grade of the SWOT sub-factor group (Example

    strength category).

    Figure 5. Inner dependence representation of SWOT model

    If it is high for a sub-factor, that will be high priority sub-factor at the local level. Inner

    dependence priority of strength category sub-factors (Wsub-factors) are calculated by

    multiplying w3 with W4 and normalized values of these weights are presented as follows:

    O

    S

    W

    T

    (a) Inner dependence

    among SWOT factors

    C1S

    C3S

    C6S

    C2S

    C4S

    C5S

    (b) Inner dependence among

    SWOT sub-factors (strength)

    C11W

    C13W

    C14W

    C15W

    C12W

    C10W

    (c) Inner dependence among

    SWOT sub-factors (weakness)

    C21O

    C19O

    C20O

    C18O

    (d) Inner dependence among

    SWOT sub-factors (opportunity)

    C29T

    C13W

    C14W

    C26T

    C28T

    C27T

    C25T

    C24TC30T

    C31T

    (e) Inner dependence among SWOT sub-factors (threat)

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    =

    ==

    5580

    0740

    2850

    1050

    5990

    3800

    3760

    0560

    2600

    0440

    0980

    1660

    000100000000775025007480

    000000010000000017800000

    000000000001000024900000

    059000000000000117801290

    423000010001116000011230

    517000000000109014400001

    34)(

    .

    .

    .

    .

    .

    .

    .

    .

    .

    .

    .

    .

    ......

    ......

    ......

    ......

    ......

    ......

    wWWStrength

    Localssub-factor

    Similar to inner dependence priority of strength category sub-factors, other categories(weakness, opportunity and threat) inner dependence priority sub-factors are calculated. The

    normalized weight of those sub-factors inner dependence priority is given as follows:

    =

    =

    =

    =

    105.0

    180.0

    072.0

    088.0

    0940

    2490

    0520

    1600

    ;

    2850

    1060

    2720

    33690

    ;

    322.0

    042.0

    0610

    2120

    2390

    1210

    ;

    279.0

    037.0

    1420

    0520

    2990

    1900

    (Local)(Local)(Local)(Local)

    .

    .

    .

    .

    W

    .

    .

    .

    .

    W.

    .

    .

    .

    W.

    .

    .

    .

    W

    d)(NormalizeThreat

    factorsub

    d)(Normalize

    yOpportunit

    factorsub

    d)(NormalizeWeakness

    factorsub

    d)(Normalize

    Strength

    factorsub

    Step 10: Determine the global priority of the SWOT sub-factors (i.e. calculate wsub-factors (Global)

    = wfactors wsub-factors (Local)). The (1st

    level and 2nd

    level) SWOT wsub-factors (Global) are combinedlocal priority (the combination of two local priority is called global priority of entire criteria).

    The eigenvectors are then normalized with considering the inner dependence. It can be

    expressed as a relative grade of the complete SWOT criteria (factor and sub-factor). If it is

    high, it will have high priority factor in the global level. Local priorities of sub-factors are

    converted into global priorities by multiplying these Wfactors with wsub-factors (Local). Global

    priorities of sub-factors (wsub-factor (Global)) are presented in Table 8.

    Table 8. Conversion of local priority of sub-factors into global priority

    SWOT factorsInner dependencepriority of factors

    Wfactor

    SWOT

    sub-factors

    Inner dependencelocal priority of sub-factors

    Wsub-factor (Local)

    Global priority of sub-factors

    Wsub-factor (Global)

    Strength 0.271

    C1S 0.190 0.051

    C2S 0.299 0.081C3S 0.052 0.014

    C4S 0.142 0.039

    C5S 0.037 0.010

    C6S 0.279 0.076

    Weakness 0.261

    C10W 0.121 0.032

    C11W 0.240 0.063

    C12W 0.212 0.056

    C13W 0.061 0.016

    C14W 0.042 0.011

    C15W 0.323 0.084

    Opportunity 0.069

    C18O 0.337 0.023

    C19O 0.272 0.019

    C20O 0.106 0.007

    C21O 0.285 0.020

    Threat 0.398

    C24T 0.161 0.064

    C25T 0.052 0.021

    C26T 0.249 0.099

    C27T 0.094 0.037

    C28T 0.088 0.035

    C29T 0.072 0.029

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    C30T 0.180 0.072

    C31T 0.105 0.042

    Step 11: Determine the priority of the alternative strategies with respect to each SWOT sub-

    factor with a 5 point linguistic scale (i.e. calculate W5). The comparison matrix for the

    alternative strategies with respect to SWOT sub-factor (mass production setup C1S) is

    constructed (Table 9).

    Table 9. Pairwise comparison matrix of alternatives priority with respect to sub-factor (C1S)

    C1S SO1 SO2 SO3 WO1 ST1 ST2 ST3 ST4 ST5 WT1 WT2 WT3 WT4Local

    Weight

    SO1 (1,1,1) (1,1,1) (1,3,5) (1,3,5) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,3,5) (1,3,5) (3,5,7) (3,5,7) (1,3,5) 0.114

    SO2 (1,1,1) (1,1,1) (1,3,5) (1,3,5) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,3,5) (1,3,5) (3,5,7) (3,5,7) (1,3,5) 0.114

    SO3 (1/5,1/3,1) (1/5,1/3,1) (1,1,1) (1,1,1) (1/9,1/7,1/5) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) 0.040

    WO1 (1/5,1/3,1) (1/5,1/3,1) (1,1,1) (1,1,1) (1/9,1/7,1/5) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) 0.040

    ST1 (1,3,5) (1,3,5) (5,7,9) (5,7,9) (1,1,1) (1,3,5) (3,5,7) (3,5,7) (5,7,9) (5,7,9) (7,9,11) (7,9,11) (5,7,9) 0.272

    ST2 (1,1,1) (1,1,1) (1,3,5) (1,3,5) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,3,5) (1,3,5) (3,5,7) (3,5,7) (1,3,5) 0.114

    ST3 (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1/7,1/5,1/3) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,3,5) (1,3,5) (1,1,1) 0.061

    ST4 (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1/7,1/5,1/3) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,3,5) (1,3,5) (1,1,1) 0.061

    ST5 (1/5,1/3,1) (1/5,1/3,1) (1,1,1) (1,1,1) (1/9,1/7,1/5) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) 0.040

    WT1 (1/5,1/3,1) (1/5,1/3,1) (1,1,1) (1,1,1) (1/9,1/7,1/5) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) 0.040

    WT2 (1/7,1/5,1/3) (1/7,1/5,1/3) (1,1,1) (1,1,1) (1/11,1/9,1/7) (1/7,1/5,1/3) (1/5,1/3,1) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) 0.033

    WT3 (1/7,1/5,1/3) (1/7,1/5,1/3) (1,1,1) (1,1,1) (1/11,1/9,1/7) (1/7,1/5,1/3) (1/5,1/3,1) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) 0.033

    WT4 (1/5,1/3,1) (1/5,1/3,1) (1,1,1) (1,1,1) (1/9,1/7,1/5) (1/5,1/3,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) (1,1,1) 0.040

    (CR 0.065)

    The local weight of the alternative strategy with respect to C1S is calculated by equation 5 to

    10 (Appendix 1). Similar to the Table 9, other twenty three SWOT sub-factors alternative

    strategy matrices are constructed and local weights have been obtained. The local weights of

    twenty four alternative strategies with respect to each sub-factor are included in matrix W 5(matrix size 24 x 13). The local weights transferred into the each column of the W5 matrix as

    follows:

    =

    00100020001000100010003000100020004000000020001000400020

    00300040002000200020008000100040004000000020001000400020

    00300040001000300020008000100040004000000020001000400020

    00300040002000300030008000100040004000000020001000400020

    00300060002000300010006000100050004000100030001000400020

    00300030001000100030008000100030004000100020001000400030

    00300040003000100030006000200040004000100020001000400030

    00200030003000200030006000200030004000100020001000400060

    00600110005000500050015000400100024000300110004002400140

    00300060002000300010006000100050004000000020001000400020

    00300060001000200020004000100050004000000020001000400020

    00300040002000100030006000100040008000100030001000900060

    00300060002000200020004000100040004000000020001000900060

    5

    ..............

    ..............

    ..............

    ..............

    ..............

    ..............

    ..............

    ..............

    ..............

    ..............

    ..............

    ..............

    ..............

    W

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    KKKKK

    Step 12: Determine the global priority of the alternative strategies, reflecting the

    interrelationships within the SWOT factors (i.e. calculate walternatives = W5 wsub-factors (Global)).

    Finally the global priorities of alternative strategies are established by multiplying the

    priorities of alternative strategies calculated with respect to sub-factors (W5) and global

    priorities of sub-factors (wsub-factors (Global)). walternatives is the relational grade of strategies based

    on the proposed ANP algorithm. It includes the priorities of the alternatives and also the

    global priority of complete criteria set. This aids the selection of best strategy. This has been

    presented in Table 10.

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    Table 10. Global priority of strategies and ranking of the strategies

    Strategy SO1 SO2 SO3 WO1 ST1 ST2 ST3 ST4 ST5 WT1 WT2 WT3 WT4

    P

    riorities Strength 0.022 0.028 0.013 0.013 0.080 0.018 0.015 0.015 0.014 0.014 0.013 0.013 0.013

    Weakness 0.027 0.026 0.029 0.032 0.069 0.026 0.029 0.026 0.031 0.032 0.030 0.029 0.012

    Opportunity 0.006 0.006 0.005 0.003 0.015 0.005 0.006 0.004 0.003 0.003 0.003 0.007 0.003

    Threat 0.030 0.022 0.032 0.049 0.129 0.045 0.037 0.037 0.025 0.040 0.038 0.038 0.054Global priority of

    alternative strategies0.085 0.082 0.079 0.097 0.292* 0.095 0.087 0.082 0.073 0.089 0.084 0.088 0.081

    Ranking 7 9 12 2 1* 3 6 10 13 4 8 5 11

    (* Best strategy)

    Step 13: Selection of best strategy based on the global priority of the alternative strategies

    (i.e. calculate rank of walternatives). The ANP algorithm indicates that implement and optimize

    an innovative process (Colour Fast FinishCFF) to reduce water, power, fuel and effluent

    load (ST1) is the best strategy with a global priority of alternative strategies value of 0.292

    (Table 10). Further the ranking which are achieved with inner dependencies in SWOT model

    (both SWOT factors and sub-factors) is presented in Table 10. This Table 10 also shows the

    contributions of SWOT main factors for the global priorities of alternative strategies. Theglobal priority of the strategies confirms that ST1 strategy is un-doubted best strategy. The 1st

    ranked strategy ST1s relative global priority 0.292 but the 2nd

    ranked WO1s relative global

    priority is 0.097. This huge difference proves that ST1 is to be studied and implemented

    without any ambiguity by the top management of the company. The other strategies expect

    ST1 are having the less relative global priority variance. The contribution of SWOT factors to

    the ST1 strategy is very high relative values compare to the other strategies. The threat and

    strength category factors and its sub-factors are the main contributing factors for the relative

    global priority of strategy ST1 and others. The threat category sub-factors mainly deals with

    the environment impact. Strength category sub-factors mainly focus companys facilities. At

    the moment the perennial issue for the society is to provide safe environment to the people

    and living hoods. The selected strategy is directly related to the goodness of environmental

    impacts. First and foremost work for the textile company is to implement the ST1 strategy;the other strategies can be given least importance.

    Step 14: Analyze the selected strategy using Force field analysis. The first step is to agree the

    area of change needs to be discussed. This might be written as a desired policy goal or

    objective. All the forces in support of the change are then listed in a column to the left

    (driving the change forward), whereas all forces working against the change are listed in a

    column to the right (restraining the change holding it back). Driving forces are those forces

    affecting a situation and which are attempting to push it in particular direction. These forces

    tend to initiate change or keep it going. Restraining forces are forces acting to restrain or

    decrease the driving forces. The forces working against the change needs to be minimized

    and the forces support of the change needs to be maximized. A state of equilibrium is reached

    when the sum of the driving forces equals the sum of the restraining forces. The net resulted

    (equilibrium forces or positive forces) forces will create the climate to implement the goal orobjective. Holmes, T.A., (2011) formulated three fundamental assertions about force fields

    and change as follows:

    1. Increasing the driving forces results in an increase in the resisting forces; the current

    equilibrium does not change but is maintained under increased tension.

    2. Reducing resisting forces is preferable because it allows movement towards the desired

    state, without increasing tension.

    3. Group norms are an important force in resisting and shaping organizational change.

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    In this paper, the selected best strategy from the Fuzzy ANP methodology is under gone force

    filed analysis to find the driving and restraining forces for its implementation. Figure 6,

    shows the force filed analysis of ST1 strategy. In this analysis, the restraining forces are

    scoring high value (-15, sum of restraining forces score) comparing to the driving force (+6,

    sum of driving forces score). The driving force consists of the following force components;

    management commitment, technical support from supplier and machinery and facility

    availability. The restraining force consists of parameter study, un-optimized of parameters,process variability, multiple quality requirement and process understanding. The restraining

    forces score needs to be minimized so as to remove the barriers to implement the strategy

    effectively.

    Figure 6. Force filed analysis of ST1 strategy

    The team of the textile company has to work on the restraining forces so as to covert the

    restraining forces to driving forces or reduce the restraining forces total score. 1st

    force, theparameter study needs to be concentrated, which will identify the process parameter involves

    in the Colour Fast Finish (CFF) process both controlled and uncontrolled parameters. 2nd

    force, optimization of the parameters is identified from the 1st

    force. 3rd

    force, variability

    reduction of the Colour Fast Finish (CFF) process by which the process can be controlled and

    can be improved. Further it will lead to the process capability studies. 4th

    force, multiple

    quality requirements which are needs to be optimized with respect to 1st

    and 2nd

    force. 5th

    force, process learning and expertise (through training) will be the base for successful

    implementation of the strategy.

    6.0 Conclusion

    Fuzzy ANP method used in this study, offers a complete analysis by additionally consideringinner dependence relationships. In this study inner dependence considered for both SWOT

    factors and sub-factors. In sub-factors all the four categories are considered the inner

    dependences. This kind of completed consideration of inner dependences will provide the

    more actual results compare the AHP or 1st

    level inner dependence ANP methods. So the

    selection of best strategy will resemble its trueness of selection. But considering more inner

    dependence requires more time and effort (additional interdependency relationships increase

    geometrically the number of pairwise comparison matrices). For this reason, an application of

    the fuzzy ANP approach, as proposed in this study targeted at more strategic decisions in a

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    human oriented thinking and reasoning approach. Triangular number over comes the

    vagueness in the ordinary Likert scale data when it is compare to classical ANP. Fuzzy

    triangular number also increases the resolution (difference between the two values) of the

    global priority of the alternative strategies. The inner dependencies make the decision makers

    work easy. If all the inner dependences considered in the selection stage itself, then the

    decision maker wont have any question of negative probability in his mind. The results of

    this empirical study show that the most desired strategy is to implement and optimize aninnovative process (Colour Fast FinishCFF) to reduce water, power, fuel and effluent load

    (ST1). This strategy had a global priority of alternative strategies value of 0.292.

    Considering other strategies ST1 is having very high potential for especially long-term

    environment safety, profit, and competitiveness considerations. Additionally, the

    implementation of this strategy is planned through force filed analysis. High scoring

    restraining forces are provided a way to implement the strategy (ST1). The restraining forces

    emphasis the study related to process parameters and multiple quality characteristics will

    minimize the distance between the restraining and driving forces. Strategy ST1 can be

    implemented in an effective manner by force filed analysis. The effectiveness of the study on

    process parameters and multiple quality characteristics will make a climate to measure the

    success of the strategy ST1. This paper addresses the need for a strategic analysis model to

    assist management in evaluating and selecting the strategies for business growth. Through

    this line, an evaluation model is developed based on a literature survey and refined with

    industrial experts. The proposed evaluation framework is generic. However, the model is

    implemented in a famous textile company, South India. The results, based on the synthesized

    judgments, indicate that textile processing industry should focus on innovative process to

    reduce energy for effective strategic planning. This research aims to help practitioners to

    understand the relative importance of the factors and set then effective improvement plans as

    they may not have sufficient resources to deal with all the factors at the same time. The

    evaluation sub-factors are comprehensive but they may change rapidly; thus, the checklist of

    SWOT sub-factors must be updated in the future (frequency, every 3 years).

    Acknowledgement The authors would like to thank the Managing Director (Mr. Prithiv), Gee Kay PrintingMills, Tirupur and his subordinates for their support and committed co-operation to this study.

    References

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    Appendix 1. (Fuzzy Set theory concepts for ANP)

    To measure the pair-wise comparison between criteria { }niCC i ,,2,1 K== , a decision group of p expertsare asked to make sets of pair-wise comparisons in terms of linguistic terms. Hence, p fuzzy matrices

    )()2()1( ~,,

    ~,

    ~ pZZZ K , each corresponding to an expert and with triangular fuzzy numbers as its elements, are

    obtained (Ming-Lang et al., 2011). Denote)(~ kZ as:

    =

    0~~

    ~0

    ~

    ~~0

    ~

    21

    2

    112

    ZZ

    ZZ

    ZZ

    Z

    (k)

    n

    (k)

    n

    (k)

    n

    (k)

    (k)

    n

    (k)

    (k)

    K

    MOMM

    K

    K

    (1)

    A triangular fuzzy number N~

    can be defined as a triplet (l, m, u) , and the membership function (x)~N

    is

    defined as (Figure 1):

    =

    ux,

    ux), m(u-x)/(u-m

    mx), l(x-l)/(m-l

    lx,

    (x)~N

    f

    p

    0

    0

    (2)

    Where ml , , and u are real numbers and uml .

    Let ( )(k)ij

    (k)

    ij

    (k)

    ij

    (k)

    ij ,u,mlZ =~

    .Without loss of generality, elements ( ),n,,iZ(k)ii K21~

    == will be regarded as a

    triangular fuzzy number whenever it is necessary. Fuzzy matrix(k)Z

    ~is called the initial pair-wise comparison

    fuzzy matrix of expert k. Acquire the normalized pair-wise comparison fuzzy matrix, Let)(~ k

    ia be the triangular

    fuzzy number:

    ==

    ====

    n

    j

    (k)

    ij

    n

    j

    (k)

    ij

    n

    j

    (k)

    ij

    n

    j

    (k)

    ij

    (k)

    i u,m,lZa1111

    ~~ and

    =

    =

    n

    j

    k

    ijni

    (k)ur

    1

    )(

    1max (3)

    The linear scale transformation is then used as a normalization formula to transform the criteria scales into

    comparable scales. The normalized pair-wise comparison fuzzy matrix of expert k, denoted as (k)X~

    , is givenby:

    =

    (k)

    nm

    (k)

    n

    (k)

    n

    (k)

    n

    (k)(k)

    (k)

    n

    (k)(k)

    (k)

    XXX

    XXX

    XXX

    X

    K

    MOMM

    K

    K

    21

    22221

    11211

    ~ ; pk ,,2,1 K= (4)

    Where,

    ==

    (k)

    (k)

    ij

    (k)

    (k)

    ij

    (k)

    (k)

    ij

    (k)

    (k)

    ij(k)

    ijr

    u,

    r

    m,

    r

    i

    r

    zX~

  • 7/30/2019 A HYBRID BUSINESS STRATEGY SELECTION PROCESS FOR A TEXTILE COMPANY USING SWOT AND FUZZY ANPA CA

    19/20

    International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976

    6510(Online), Volume 3, Issue 2, May-August (2012)

    As that in crisp value assumes at least one, such that=