Measurement and Sorting of MSMEs Business Performance Rating Using Analytical Hierarchy Process

Abstract

This research was conducted in an enterprise that provides venture capital assistance to its 876 Micro,
Small, and Medium Enterprises (MSME) partners to measure and sort the performance of their
business. The enterprise wished for a business performance calculation system that is more reliable
and utilized more than one criterion. In addition, the enterprise also desired to give rewards to MSMEs
with the most excel accomplishment, so they need to know which MSMEs are the most developed
among others. This study uses focus group discussions and existing data to obtain the appropriate
performance measurement criteria. The determination of the weight of the importance of each
criterion was carried out using the Analytical Hierarchy Process (AHP) method using pairwise
comparison techniques and its consistency is measured using the transitive property and consistency
ratio. The proposed method is emphasized on ease of use and delivery to stakeholders but still capable
of acquiring the performance calculation. The calculation includes the increase or decrease rate of the
business performance for each MSME, and after sorting the rating, the most accomplished MSME
also can be found. The application of this method also can help the stakeholder to reach consensus
swiftly.