Location Selection for Overseas Investment in Turkish Private Hospital Sector Using AHP-Based TOPSIS Method

Abstract

Purpose – This study aims to investigate a decision support model for Turkish private hospital enterprises to select the optimal location for establishing a new hospital abroad. The primary objective is to enable private hospital operators active in Turkey to make the best location selection for their investments within the scope of foreign direct investment (FDI) decisions, utilizing an Analytical Hierarchy Process (AHP)-based TOPSIS method.

Design/methodology/approach – In this study, a two-stage model integrating the Analytical Hierarchy Process (AHP) and TOPSIS, which are multi-criteria decision-making techniques, was utilized. Within the scope of applying this model, the nationalities of patients coming to Turkey for medical and health reasons were analyzed, and it was determined that the majority came from Germany, France, the United Kingdom, Azerbaijan, and the Netherlands. To select the optimal alternative for hospital investment among these designated countries, 7 main and 32 sub-criteria were identified, and the opinions of 20 experts were obtained. Based on these expert opinions, the weights of the criteria were calculated using AHP. In the final stage, the alternative countries were evaluated according to the criteria weights using the TOPSIS method, and the most suitable investment locations were ranked.

Findings – London was determined as the optimal alternative for investment location selection. This alternative is followed by Paris, Amsterdam, Berlin, and Baku in the last position, respectively. The criteria influencing the evaluation of the alternatives, ordered by their level of importance, are health demand, competitors, accessibility to services, government policies, cost, environmental conditions, and related industries.

Discussion – In this study, the criteria in the decision-making process of private hospitals investing abroad were identified, and investment alternatives were evaluated within the framework of these criteria. Within the scope of the study, the most optimal investment location and the key criteria that stand out in this decision-making process were investigated. For future studies, it is recommended to incorporate different methods into the process to re-determine criteria weights by consulting a larger number of experts and to further develop the model.