Using Fuzzy Integral Approach to Enhance Site ... - Semantic Scholar

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Procedia Computer Science 17 (2013) 306 – 313

Information Technology and Quantitative Management (ITQM2013)

Using fuzzy f integral approach a to enhance site selection assessment a case study of the optoelectronics industry d Yao-Chen Kuoa*, Shih-Tong Lua, Gwo-Hshiung Tzenga,b, Ying-Chieh Lina, YuShyang Huanga a

Institute of Innovation and Project Management, Kainan University, No. 1 Kainan Rd., Luchu, Taoyuan 338, Taiwan b Institute of Management of Technology, National Chiao Tung University, Ta-Hsuch Road, Hsinchu 300, Taiwan

Abstract The policies deployed by the government in Taiwan determine dramatically affect the development of a sector. In the past three decades, the high-tech industry has contributed to the prosperity of the economy for Taiwan. The focus of potential sectors includes green energy, optoelectronics, biotechnology industry, and agricultural science and technology industries. This study is to develop an enhanced assessment approach to evaluate candidate sites for building an optoelectronics factory. Traditionally, the assessment approach was conducted by ignoring the multiplicative effects of explored selection criteria in the real world. In order to resolve the above inadequacy on site selection assessment, fuzzy integral method (FIM) and consistent fuzzy preference relations (CFPR) were integrated to the proposed assessment approach to enhance the site selection assessment. Two optoelectronics sites were evaluated by employing the proposed assessment approach. The results through implementing the proposed approach not only could benefit decision makers to facilitate the site selection but also be more effective in real operations than tradition additive aggregate method. The results of the sensitivity analysis on FIM results were also more effective to plan the improvement strategies for the targeted site.

© 2013 The Authors. Published by Elsevier B.V. Selection and peer-review under responsibility of the organizers of the 2013 International Conference on Information Technology and Quantitative Management Keywords: Site selection, fuzzy f preference relations, ffuzzy integral, MCDM (multiple criteria decision making)

1. Introduction The optoelectronic industry in Taiwan has continued to flourish in recent years. In addition to selff sustaining, and insight into the opportunities of the industry itself, the government s supports via deployed policies enable the industry to be a major provider in the current highly competitive global optoelectronic market. The industry will sustain its improvements and maintain the leading role globally. The development in the technology industry is required to go through the stage of plant construction, and then enter the production stage. How to

*

Corresponding author: Yao-Chen Kuo, Tel.: +886-928-905336 E-mail address: [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]

1877-0509 © 2013 The Authors. Published by Elsevier B.V. Selection and peer-review under responsibility of the organizers of the 2013 International Conference on Information Technology and Quantitative Management doi:10.1016/j.procs.2013.05.040

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choose suitable conditions for the development and building of the company's plant houses has become an important issue in the optoelectronic industry. An appropriate factory site should be selected firstly, and then a plant construction project was initiated and expected to be completed on time or even ahead of time. By doing so, the factory may successfully enter mass production, not only can increase the company's revenue, but also seize the initiative; as a result, the company may have momentum to expand its market share. Moreover, the company may create its competitiveness in the market for enlarging more power from their competitors in industry. The data on site location assessment for any company in the optoelectronic industry are often considered as confidential. Only the staffs involved in the site selection or plant-construction project can access to the relevant information. In other words, site selection processing materials are extremely important for the business operation to the companies in the optoelectronic industry. Current selection models of plant location contain the assessment factors generally sorted out subjectively by the company itself. In view of candidate site locations, various factors are first evaluated, and then weighted scores or average scores are applied to do statistical computation. The priority was obtained according to the score calculation results. The site with highest total score was usually selected as the new factory site. In current approaches, all evaluation factors evaluated for the candidate future plant site on the impacts of business operations were assumed to be independent. However, it was believed that each assessed factor has multiplicative effects with other factors on business operations. Traditional additive-assessment methods do not consider the multiplicative effects on future business and possibly produce scoring bias leading to making inappropriate decision on site selection in real world. In order to resolve this kind of biased assessment, this study uses consistent fuzzy preference relations (CFPR) and Fuzzy Integral Method (FIM) to construct a state of the art assessment model for the site selection for a new optoelectronic factory. In advance of the decision on a new factory site, a company will make a comprehensive site study based on the characteristics of the belonging business operations. Selecting a plant location for a newly established company will be more relevant to near an industrial cluster area and have overall lower cost of plant construction since these companies have limited capital and often encounter shortterm shortage of operating income contribution. In response to market demand, an existent company usually needs expansion of old plant to expand its production capacity. For these companies, the strategies on determining a new plant site, the nearby venues of the existing plants will be mostly put into the top priority. The reason is that the factory operation requires maintaining a certain degree of manpower both in the direct production units and other non-production support units. Sufficient manpower can ensure the smooth operation of a new production line. Nevertheless, other nonproduction units, unless it is necessary, should not add too much manpower. The needed manpower of support units can be supplied by the nearby existing factory. Therefore, the new plant is in the nearby of the existing plants, it can not only reduce the cost of manpower but strengthen the related manpower support in scheduling. If a new site location is far from any existing plant, the supporting mobility of human resources can be negatively affected. In addition, there are also significant negative effects on availability of seed technicians who can provide assistances of equipping with the production capacity and technology establishment for the newly-recruited staff in a new plant. Consequently, criteria employed to select a site location for either a newly established company or an expansion of an existent company will be highly related to individual needs of each company. This study aims to build up a more practical and useful model to enhance site selection assessment process for the optoelectronics industry with the consideration of multiplicative effects of investigated factors on plant construction, and future business operations.

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2. Literature Review Site location has been identified as one of the key factors to achieve the desired organizational performance and strategic objectives when a new industrial plant was built [1, 2-6]. The site location of a plant is often related to the distance, humanities, environment, cost, geology, topography, infrastructure and equipment. The selection criteria of a new plant site should account for the characteristics of the product, the way of the process, as well as the culture of the company. This study aims to construct a systematic mechanism of site selection assessment. An initial depth discussion is given to explore potential criteria for the selection of a plant site. In the past studies, there was few regarding site selection assessment for building an industrial plant especially in the optoelectronics industry. This study therefore integrates the explored site selection criteria in different industries and put into the considerations of the characteristics of the optoelectronics industry products, the general characteristics and culture of the optical power plant in business operation, the experiences participated in construction projects and operation management of the optoelectronic industrial plant and expert interviews to establish the hierarchical framework of criteria on selecting the site location for optoelectronic industrial plants. Construction Industry Institute (CII) developed a pre-project planning tool, named as Project Definition Rating Index (PDRI) [1] to guide and facilitate pre-project planning of a new industrial construction project. This tool can also be used to review the degree of completeness or risk of an industrial project at the plan and design phase. The six relevant factors addressed in the PDRI for industrial projects regarding site selection include site location, survey and soil tests, environment assessment, permit requirements, utility supply conditions, and fire protection & safety considerations. Among them, the site location addresses significant issues regarding whether the location of a newly-built plant will meet the requirements of owners or the maximum benefit for the company. Therefore, evaluating site location criteria should take into account for the long-term or short-term operating needs of the company. In the surveys and soil tests dimension, an industrial plant site prior to be settled is required to assess its geology, topography, existing pollution, load-carrying capacity, infrastructure proximity and other factors in view of the impact on construction of a plant and future operations. In the environmental assessment dimension, the main considerations are placed on assessing the impacts of environment, land uses and distances from residential area on plant construction and future operations. impacts on construction and operation of the plant. At the aspect of infrastructure supply condition, water, electricity, and other infrastructure providing the basic functionality directly and indirectly will affect the construction of the plant as well as the operation and management of the future plant. Site selection criteria and dimensions were explored and arranged as Fig. 1 based on the literature reviews [1~14], and expert interviews. The framework of site selection assessment criteria includes six dimensions which are plant location , environment and natural conditions , construction and operating costs , infrastructure and equipment , and human resources . Total of 25 criteria included in all six dimensions were finalized as the site selection assessment criteria in the proposed framework.

Yao-Chen Kuo et al. / Procedia Computer Science 17 (2013) 306 – 313 A1.Distance from the plant location to the main (potential) customers A2.Distance from the plant location to potential competitors A.The Plant Location [23][26][27][24]

A3.Distances from the Plant location to main material suppliers and equipment suppliers A4.Distance from plant location to critical infrastructure A5.Distance from plant location to residential areas B1.Climatic conditions B2.Geological conditions

B.Environment and Natural Conditions [14][15][20][24][30]

B3.Terrain conditions B4.Size of available site area B5.Site use efficiency (including the needs of the future plant expansion) C1.Transportation costs C2.Land costs

Site Selection

C.Construction and Operating Costs [12][13][14][15][16] [19][24][16][26]

C3.Water and electricity costs C4.Labor costs C5.Construction costs C6.Raw material costs

D.Policies and Folk Customs [12][14][15][2223][24][25][26]

D1.Politics and policy D2.Environmental pollution prevention requirements D3.Protests and harassment E1.Hydraulic supply

E.Infrastructure and Equipment [14][15][16][24]

E2Power supply E3.Public facilities (leisure, parking, health care, schools, etc.) F1.Recruiting (direct, indirect personnel) F2.Willingness of existing staff transferring to the new plant

F.Human Resources [12][14][15][16][24]

F3.Quality of available labor

Fig. 1. Hierarchical Framework of Site Selection Assessment Criteria

3. Research Methods To enhance and simplify the operations of analytic hierarchical programming(AHP), researchers proposed a consistency fuzzy preference relations (CFPR) approach to deal with the issue of inconsistency on data collection and reduce number of the required comparisons for the implementation of AHP. Therefore, this study employs CFPR to evaluate relative effects of identified site selection assessment criteria for further FIM applications. The CFPR were proposed for constructing the decision matrices by pairwise comparisons based on additive transitivity [15, 16]. The concept and steps of using CFPR is referred to Herrera-Viedma s article [15].

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3.1. Fuzzy Integral FIM In reality, site selection assessment criteria are existing the interrelationship of multiplicative effects on plant construction cost and future plant business operations; the results of multiplicative effects could be much larger than the additive effect of an individual criterion. Ignorance of the multiplicative effects could produce bias site selection assessment and lead to ineffective decisions on site selection. Sugeno (1974) [17] proposed the fuzzy integral method which applies fuzzy measures to investigate the level of multiplicative effects among events, and then applied the results of fuzzy measures to assessment of the performance for interested alternatives [18]. In this study, the fuzzy integral approach is applied to construct the site selection assessment process in order to yield more realistic results for site selection assessments. 3.2. Fuzzy Measure The fuzzy measure approach uses monotonicity in replacement of the additive approach to consider potential multiplicative effects of the investigated criteria on the targeted performance [18]. The -fuzzy measure was employed to examine multiplicative effects on various dimensions and criteria to future plant operations in this study. The fuzzy measure parameter, denoted as , describes the degree of additive the fuzzy measure holds. Based on the concept of the fuzzy measure, g is defined as the set function of a power set P ( x) , where

X

{x1 , x2 ,

, xn } is a limited set. A

A, B P( X ), A

, g (A

B

Fuzzy measure density gi n

g {x1, x2 ,..., xn }

g n 1

({xi })

g ( A) g ( B)

gi1gi 2 ... i1 1 i 2 i1 1

is a fuzzy density with the following properties:

g ( A) g ( B), for 1

(1)

can be expressed as:

n

gi i 1

B)

-fuzzy measure g

n 1

g1g2 ,..., gn

1

n

(1

gi )

1 , for 1

(2)

i 1

According to the property of , there are three possible conditions of the multiplicative effects between A and B: 0 , then g ( A B ) g ( A ) g ( B ) . This means that the effect evaluation of the set {A, B} 1. If is larger than the sum effect evaluations of sets {A} and {B}. The performance assessment should include the positive multiplicative effects of A and B, when both A and B are satisfied. 0 , then g ( A B ) g ( A ) g ( B ) . This means that there is no multiplicative effect of {A,B}. 2. If 0 , then g ( A B ) g ( A ) g ( B ) . This means that the effect evaluation of the set {A, B} is 3. If smaller than the sum effect evaluations of the sets{A} and {B}. The performance assessment should include a negative multiplicative effect of A and B, when both A and B are satisfied. 3.3. Fuzzy Integral

The concept of the fuzzy integral proposed by Choquet is a nonlinear and non-additive decision analysis technology since it considers and includes the multiplicative effects of different criteria [14]. Through the investigation of fuzzy measures and its utilization, the estimated performance can be closer to the actual performance. Let h be a measurable function from X to [0, 1]. Assuming h ( x1 ) h ( x2 ) h ( xn ) , then the fuzzy integral is defined as follows:

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Yao-Chen Kuo et al. / Procedia Computer Science 17 (2013) 306 – 313

hdg

h( xn ) g ( H n )

h( xn 1 ) h( xn ) g ( H n 1 ) ...

h( xn ) g ( H n ) g ( H n 1 )

h( x1 ) h( x2 ) g ( H1 )

h( xn 1 ) g ( H n 1 ) g ( H n 2 )

(3)

... h( x1 ) g ( H1 )

4. Results and Discussions 4.1. Results in FPR and Fuzzy Integral Analysis Consistency Fuzzy Preference Relations was applied to determine the weights of site selection dimensions and criteria on a business operations. The weighting results, obtained from the CFPR analysis, are under the assumption of all evaluated criteria being independent and having on multiplicative effects on plant construction cost and business operations of the future plant. In realistic conditions, multiplicative effects of interested criteria on an objective function are considered in selection-typed decision makings. Therefore, it is more realistic to include the analysis of multiplicative effects into the assessment and decision-making mechanism. This study employed the weighting results from consistency fuzzy preference relations and applied the fuzzy integral method to include the multiplicative effects to the scoring mechanism of site selection assessment. This study will address two factory sites to conduct the scoring analysis through the proposed assessment approach, and then relevant site selection and further improving decision is made based on the results. The empirical analysis results with fuzzy integral (FIM) are obtained in Table 1. The score of site A is 6.099; the score of site B is 6.625. The site B is the best choice with the considerations of the multiplicative effects of criteria and dimensions. Table 1 Scoring comparison of fuzzy integral (FIM) at site A and site B.

Dimension

A

B

C

D E F

Dimension The A site of Fuzzy g(D) Criteria Dimensions Measure scores A1 A2 0.37 0.233 A3 5.567 A4 A5 B1 B2 0.37 0.112 B3 4.384 B4 B5 C1 C2 C3 0.37 0.158 6.237 C4 C5 C6 D1 0.37 0.088 D2 7.112 D3 E1 0.37 0.143 E2 6.843 E3 F1 0.37 0.143 F2 6.905 F3 A scores : 6.099 B scores : 6.625

The B site dimensions scores

Fuzzy Measure A B g(x) of Each Criteria Satisfaction Satisfaction

7.11

0.524

6.61

0.833

6.69

0.269

8

1.627

7

1.331

5.57

1.701

0.299 0.068 0.197 0.186 0.097 0.138 0.188 0.078 0.113 0.264 0.243 0.087 0.141 0.208 0.097 0.13 0.326 0.247 0.138 0.387 0.301 0.074 0.31 0.118 0.278

5 7 4 7 8 6 6 3 3 4 6 6 7 7 5 6 8 8 5 7 7 6 7 6 8

8 6 6 7 6 6 4 7 8 8 6 8 7 7 5 6 8 8 8 7 7 7 5 7 6

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4.2. Discussions for Comparing FPR guidelines weights and FIM sensitivity analyses There are considerable differences, shown in Table 2, in the comparison of the results of the FPR weighting analysis and the sensitivity analysis using FIM scoring method. Without the consideration of multiplicative effects, A1, E1, and F1 were considered as the three most critical criteria to be improved to enhance the business operations of the new plant. After the multiplicative effects were included in the scoring process, A1, A3, and A4 become the three most critical criteria for site A to be improved, and F1, A1, and A4 are for site B. Table 2 Comparison of FPR weighting and FIM sensitivity analysis results. Rank

Global weight(FPR)

Rank

A1 E1 F1 E2 F3 A3 A4 C1 D1 B5 C4 D2 B2 A5 C3 F2 C6 B1 A2 D3 C5 B4 C2 E3 B3

0.094 0.083 0.072 0.064 0.064 0.062 0.058 0.048 0.046 0.043 0.041 0.035 0.031 0.031 0.028 0.027 0.026 0.023 0.021 0.019 0.019 0.019 0.017 0.016 0.013

A1 A3 A4 F2 F1 E1 C1 E2 F3 C4 B5 A5 B2 D1 D3 C3 C6 A2 E3 C5 D2 B4 C2 B1 B3

Sensitivity Analysis (FIM) (Plant A) 0.116 0.089 0.063 0.055 0.051 0.05 0.049 0.043 0.041 0.037 0.034 0.031 0.031 0.028 0.026 0.025 0.025 0.023 0.023 0.021 0.021 0.018 0.017 0.014 0.012

Rank F1 A1 A4 F3 E1 A5 E2 A2 D1 A3 D2 F2 C1 C2 B2 D3 E3 B5 B1 C4 B4 B3 C6 D5 D3

Sensitivity Analysis (FIM) (Plant B) 0.013 0.116 0.096 0.091 0.086 0.073 0.073 0.063 0.057 0.05 0.05 0.05 0.042 0.042 0.041 0.041 0.039 0.038 0.032 0.029 0.024 0.023 0.019 0.017 0.015

5. Conclusions and remarks The study aims to apply a fuzzy integral method to conduct new plants' site selection assessment in the optoelectronics industry. We can get a general understanding of the relative importance of each dimension and criteria. However, if a researcher intends to carefully assess two similar programs or in considerations of improving the suitability of the site location, the multiplicative effects may be put into consideration to have more appropriate selection of site location in reality. The sensitivity analysis results could be further used to improve the features of the elected site location for better business operations. In future, in view of more important criteria, DANP + VIKOR can be applied to conduct exploration and make comparisons with the findings in this study. References [1]

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