Key words: management functions, decision making, Analytical Hierarchy Process (AHP)

Abstract

The aim of this paper is to demonstrate the selected possibilities of application of AHP in corporate management, and also the links between specific functions of management and the decision making process and to present the main assumptions, tools and history of the model. It was demonstrated that hierarchic analyses can be applied in every aspect of human activity to the optimizing of problem solving. The review of analyzed variants of application of suggested method was made on the basis of the examples in Polish and in world literature, what allowed better presentation of the application gamut of the AHP method both in corporate and public sectors. It was indicated that the method can be adapted to the solution of problems in such specific industries as agriculture and food industry.

INTRODUCTION

Corporate management requires that the managers constantly make decisions connected to the aspects of operation both in the field of company itself as with the reference to company's environment. The dynamic changes of the conditions of operation enforce the necessity of competent, prompt and sensible solving of complex and sometimes difficult problems. These problems frequently take into their reach all functions of the organization and concern not just one decision-maker but a group of such persons. Making decisions in a reasonable way, in such situation becomes somehow impeded. It is necessary to use the tools aiding the decision making process. One of such tools, undergoing in the recent years the intense development of applications is the Analytical Hierarchy Process. This paper aims to describe the gamut of possible applications of this method in the corporate management.

MANAGEMENT AND DECISION-MAKING

Corporate management encompasses a range of actions allowing the achievement of the determined aims in a competent and effective way. These actions comprise planning, decision making, organizing, leadership and control. Decision making is connected to every of mentioned managerial functions and it could be defined as a choice of course of action from between available possibilities. This definition, however, could be attributed both to the specific action and to a process.