Fuzzy multiple criteria decision model for the evaluation of AMS

Abstract The economic justification of advanced manufacturing systems is very important today, but it is difficult to obtain sound answers using ordinary financial techniques, such as discounted cash flow (DCF) measures. These techniques over-simplify investment decisions, because they are unable to account for the strategic issues and for the uncertainty of financial flows present in AMS investments. In this paper, a fuzzy multiple criteria decision model is presented. A fuzzy set theory approach is suggested because it is able to tackle both the linguistic assessments necessary for strategic issues, and the uncertainty of financial flows. The proposed method calculates a fuzzy integrated index that brings together both the qualitative and quantitative, but uncertain, issues. Ranking the investment alternatives based on this index, the analyst can determine which option is more suited to the company's objectives.