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Topsis Method

TOPSIS is a multi-criteria decision analysis method that compares alternatives based on criteria and chooses the alternative closest to an ideal solution and farthest from a negative ideal solution. It involves assigning weights and impacts (positive or negative) to criteria and calculating the Euclidean distance of alternatives to determine the ranking. While computationally efficient, TOPSIS has disadvantages like ranking reversals when new alternatives are added.

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GLENN ABACAHIN
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128 views1 page

Topsis Method

TOPSIS is a multi-criteria decision analysis method that compares alternatives based on criteria and chooses the alternative closest to an ideal solution and farthest from a negative ideal solution. It involves assigning weights and impacts (positive or negative) to criteria and calculating the Euclidean distance of alternatives to determine the ranking. While computationally efficient, TOPSIS has disadvantages like ranking reversals when new alternatives are added.

Uploaded by

GLENN ABACAHIN
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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TOPSIS METHOD

TOPSIS, known as Technique for Order of Preference by Similarity


to Ideal Solution, is a multi-criteria decision analysis method. It compares a set of
alternatives based on a pre-specified criterion. The method is used in the business across
various industries, every time we need to make an analytical decision based on collected
data. It came in the 1980s as a multi-criteria-based decision-making method. TOPSIS
chooses the alternative of shortest the Euclidean distance from the ideal solution and
greatest distance from the negative ideal solution.
To make this definition easier, let’s suppose you want to buy a mobile phone, you
go to a shop and analyze 5 mobile phones on basis of RAM, memory, display size,
battery, and price. At last, you’re confused after seeing so many factors and don’t know
how to decide which mobile phone you should purchase. TOPSIS is a way to allocate the
ranks on basis of the weights and impact of the given factors.

• Weights mean how much a given factor should be taken into consideration
(default weight = 1 for all factors). like you want RAM to have weighed more than
other factors, so the weight of RAM can be 2, while others can have 1.
• Impact means that a given factor has a positive or negative impact. Like you
want Battery to be large as possible but the price of the mobile to be less as
possible, so you’ll assign ‘+’ weight to the battery and ‘- ‘weight to the price.
This method can be applied in ranking machine learning models on basis of various
factors like correlation, R^2, accuracy, Root mean square error, etc. Now that we have
understood what is TOPSIS, and where we can apply this. TOPSIS is a compensatory
method. These kinds of methods allow the compromise between different criteria, where
a bad result in one criterion can be compensated by a good result in another criterion. An
assumption of TOPSIS method is that each criterion has either a monotonically increasing
or decreasing preference. Due to the possibility of criteria modelling, compensatory
methods, certainly including TOPSIS, are widely used in various sectors of multi-criteria
decision making

TOPSIS Efficiency
First, it is important to discuss the efficiency of the TOPSIS method. The calculation time
of the TOPSIS method rises slightly when the number of criteria increases

Disadvantages
TOPSIS presents the problem of ranking reversal (the final ranking can swap when new
alternatives are included in the model).

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