Normalization transforms raw data into a comparable scale (0-1). The normalization formula depends on whether the criterion is a (higher is better) or a cost (lower is better). Benefit Criterion: Cost Criterion: 4. Apply Weights Assign weights ( ) to each criterion based on its importance, ensuring 5. Calculate the SAW Index (Preference Value) Calculate the final preference value ( Vicap V sub i ) for each alternative ( Aicap A sub i
) by multiplying the weight by the normalized score and summing them up:
Used to evaluate and rank ESG (Environmental, Social, and Governance) controversy risks, allowing for the quantification of whistleblowing performance by aggregating various risk factors.
In the realm of Multi-Criteria Decision-Making (MCDM), the index method is one of the most popular, intuitive, and widely applied techniques for selecting the best alternative among several options, especially when dealing with complex, multi-faceted criteria.
The SAW method is exceptionally versatile and is used across various fields:
It is clear how each criterion affects the final outcome, making it ideal for justification in public or corporate decision-making.
The method is easy to understand and implement, making it accessible to non-experts.
Vi=∑j=1nwjrijcap V sub i equals sum from j equals 1 to n of w sub j r sub i j end-sub Advantages of the SAW Index Method