The Application of Analytical Hierarchy Process (AHP) to Determine Best Cost Efficiency Program: A Case Study of Green Farm Company

https://doi.org/10.35912/jbpd.v4i2.4533
Published: Jan 15, 2025

Abstract:

Purpose: CV. XYZ as hydroponic agriculture, for years since 2019, producing high-demand crops such as lettuce and spinach. Nevertheless, there has been a decline in revenue that is a result of the inefficiencies in the management of operational costs. Thus, this study aimed to come up with identification and prioritization of cost-efficiency strategies with the intervention of in-depth interviews and Analytical Hierarchy Process (AHP).

Method: A mixed-mode methodology was used. The qualitative in-depth interviews between the Board of Directors were analyzed for the most important triangulated criteria and subcriteria that drive operational efficiency. A quantitative AHP analysis was done to slightly compare these factors.

Results: Technology Levers turned out to be the most influent factor, hybrid farming system was the most feasible alternative, with advantages for offering a balanced system that integrates traditional farming practices with modern technologies for sustainability and efficiency.

Conclusions: Integrating human capital development and technological innovation is imperative for optimal operation efficiency and sustainable growth in the hydroponic agriculture sector.

Limitations: This research is limited by the scope of its data sources and the relatively short evaluation period, which may not fully capture the long-term impacts of the proposed strategies.

Contributions: This conclusion contributes to the field by offering a strategic framework that integrates technological innovation and human resource development for improved agricultural productivity. It provides policymakers, agribusiness leaders, and practitioners with actionable insights into balancing traditional knowledge and digital transformation to address systemic inefficiencies.

Keywords:
1. Analytical Hierarchy Process (AHP)
2. Cost efficiency
3. Hydroponic agriculture
4. Operational optimization
Authors:
1 . Fajar Palguna Wijaya
2 . Manahan Parlindungan Saragih Siallagan
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How to Cite
Wijaya, F. P. ., & Siallagan, M. P. S. . (2025). The Application of Analytical Hierarchy Process (AHP) to Determine Best Cost Efficiency Program: A Case Study of Green Farm Company . Jurnal Bisnis Dan Pemasaran Digital, 4(2), 147–160. https://doi.org/10.35912/jbpd.v4i2.4533
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Issue & Section
Vol. 4 No. 2 (2025): Januari
Articles
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References

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    Alim, M. Z. (2023). The role of waste banks in realizing good environmental governance in Bandarlampung City. Journal of Governance and Accountability Studies, 3(1), 51-61.

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    George, A. A. (2021). Social and cultural influences and their implications for sustainable tourism: A case study of Trinidad & Tobago's tourism and the growth of the LGBTQ traveler segment. Journal of Sustainable Tourism and Entrepreneurship, 2(3), 147-157.

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    Masum, A. K. M., Abid, F. B., Arafat, A. Y., & Beh, L.-S. (2020). Factors Influencing Practice of Human Resource Information System in Organizations: A Hybrid Approach of AHP and DEMATEL. International Journal of Advanced Computer Science and Applications, 11(6), 700-706.

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    Tziner, A., & Birati, A. (1996). Assessing employee turnover costs: A revised approach. Human Resource Management Review, 6, 113-122. doi:10.1016/S1053-4822(96)90015-7

  1. Al-Kodmany, K. (2018). The vertical farm: A review of developments and implications for the vertical city. Buildings, 8(2), 24.
  2. Alim, M. Z. (2023). The role of waste banks in realizing good environmental governance in Bandarlampung City. Journal of Governance and Accountability Studies, 3(1), 51-61.
  3. Beacham, A., Vickers, L., & Monaghan, J. (2019). Vertical farming: a summary of approaches to growing skywards. The Journal of Horticultural Science and Biotechnology, 94, 1-7. doi:10.1080/14620316.2019.1574214
  4. Bora, Y., Fanggidae, R. E., & Fanggidae, A. H. (2023). Analysis of the role of online transportation on tourism development (A study of tourists on users of grab online transportation services in kupang city). Journal of Multidisciplinary Academic and Practice Studies, 1(1), 1-10.
  5. Campi, I., Agostini, M., Marelli, F., de Filippis, T., Romartinez-Alonso, B., Rajanayagam, O., . . . Andreasi, M. (2021). Clinical consequences of variable results in the measurement of free thyroid hormones: unusual presentation of a family with a novel variant in the THRB gene causing resistance to thyroid hormone syndrome. European Thyroid Journal, 10(6), 533-541.
  6. Canco, I., Kruja, D., & Iancu, T. (2021). AHP, a reliable method for quality decision making: A case study in business. Sustainability, 13(24), 13932.
  7. Dalwai, T., & Salehi, M. (2021). Business strategy, intellectual capital, firm performance, and bankruptcy risk: evidence from Oman's non-financial sector companies. Asian Review of Accounting, 29(3), 474-504.
  8. Derouiche, I., Manita, R., & Muessig, A. (2021). Risk disclosure and firm operational efficiency. Annals of Operations Research, 297. doi:10.1007/s10479-020-03520-z
  9. Despommier, D. (2010). The vertical farm: feeding the world in the 21st century: Macmillan.
  10. Dionysopoulou, P. (2020). Agritourism entrepreneurship in Greece: policy framework, inhibitory factors and a roadmap for further development. Journal of Sustainable Tourism and Entrepreneurship, 2(1), 1-13.
  11. Farrell, M. (1957). The Measurement of Productive EfficiencyJournal of the Royal Statistical Society. Series A (General).
  12. George, A. A. (2021). Social and cultural influences and their implications for sustainable tourism: A case study of Trinidad & Tobago's tourism and the growth of the LGBTQ traveler segment. Journal of Sustainable Tourism and Entrepreneurship, 2(3), 147-157.
  13. Ghofar, A., & Islam, S. (2015). Corporate Governance and Contingency Theory. doi:10.1007/978-3-319-10996-1
  14. Gumbo, L., Margaret, M., & Chagwesha, M. (2022). Personal financial management skills of university students and their financial experiences during the COVID-19 pandemic. International Journal of Financial, Accounting, and Management, 4(2), 129-143.
  15. Handoyo, S., Suharman, H., K Ghani, E., & Soedarsono, S. (2023). The determinants of a firm’s strategic orientation and its implication on performance: A study on Indonesia state owned enterprises. Cogent Business & Management, 10. doi:10.1080/23311975.2023.2220209
  16. Ingram, K. K., Ay, A., Kwon, S. B., Woods, K., Escobar, S., Gordon, M., . . . Jain, K. (2016). Molecular insights into chronotype and time-of-day effects on decision-making. Scientific Reports, 6(1), 29392.
  17. Jiang, Y., Jamil, S., Zaman, S. I., & Fatima, S. A. (2024). Elevating organizational effectiveness: synthesizing human resource management with sustainable performance alignment. Journal of Organizational Effectiveness: People and Performance, 11(2), 392-447.
  18. Lamourou, H., Karbout, N., Zriba, Z., Zoghlami, I. R., & Ouessar, M. (2022). Green waste biochar effects on sandy soil physicochemical properties. JOURNAL OF OASIS AGRICULTURE AND SUSTAINABLE DEVELOPMENT, 4(3), 38-47.
  19. Masum, A. K. M., Abid, F. B., Arafat, A. Y., & Beh, L.-S. (2020). Factors Influencing Practice of Human Resource Information System in Organizations: A Hybrid Approach of AHP and DEMATEL. International Journal of Advanced Computer Science and Applications, 11(6), 700-706.
  20. Olayemi, A. A. (2020). Public perception, practices, and readiness for post Covid-19 lifestyle in Ikolaba Community, Ibadan. Journal of Social, Humanity, and Education, 1(1), 1-12.
  21. Pasupathy, K., & Steege, L. (2011). Impact of Fatigue on Performance in Registered Nurses: Data Mining and Implications for Practice. Journal for healthcare quality : official publication of the National Association for Healthcare Quality, 34, 22-30. doi:10.1111/j.1945-1474.2011.00157.x
  22. Sarker, B. K., Gain, N., Saha, S. K., Mondal, N. B., & Ifte, I. (2024). A quantitative research of learning habits of secondary school students: An observational study in Dhaka Division. Journal of Social, Humanity, and Education, 4(2), 117-127.
  23. Tziner, A., & Birati, A. (1996). Assessing employee turnover costs: A revised approach. Human Resource Management Review, 6, 113-122. doi:10.1016/S1053-4822(96)90015-7