Designing an integrated AHP based decision support system for supplier selection in automotive industry

PurposeThe purpose of this paper is to propose a decision support model for supplier selection based on analytic hierarchy process (AHP) using a case of automotive industry in a developing country of Pakistan and further performs sensitivity analysis to check the robustness of the supplier selection decision.MethodologyThe model starts by identifying the main criteria (price, quality, delivery and service) using literature review and ranking the main criteria based on experts’ opinions using AHP. The second stage in the adopted methodology is the identification of sub criteria and ranking them on the basis of main criteria. Lastly perform sensitivity analysis to check the robustness of the decision using Expert Choice^ۛ software.FindingsThe suppliers are selected and ranked based on sub criteria. Sensitivity analysis suggests the effects of changes in the main criteria on the suppliers ranking. The use of AHP in the supplier selection gives the decision maker the confidence of the consistency and the robustness throughout the process.Practical implicationsThe AHP methodology adopted in this study provides managers in automotive industry in Pakistan with the insights of the various factors that need to be considered while selecting suppliers for their organizations. The selected approach also aids them in prioritizing the criterion. Managers can utilize the hierarchical structure of adopted supplier selection methodology suggested in this study to rank the suppliers on the basis of various factors/criteria.Originality/valueThis study makes three novel contributions in supplier selection area. First, AHP is applied to automotive industry and use of AHP in the supplier selection gives decision maker the confidence of the consistency. Second, sensitivity analysis enables in understanding the effects of changes in the main criteria on the suppliers ranking and help decision maker to check the robustness throughout the process. Last, we find it important to come with a simple methodology for managers of automotive industry so that they can select the best suppliers. Moreover, this approach will also help managers in dividing the complex decision making problem into simpler hierarchy.     

An integrated fuzzy-lp approach for a supplier selection problem in supply chain management

In supply chain management process, the firm select best supplier takes the competitive advantage to other companies. Thus, supplier selection is an important issue and with the multiple criteria decision-making approach, the supplier selection problem includes both tangible and intangible factors. This paper is aimed to present an integrated fuzzy and linear programming approach to the problem. Firstly, linguistic values expressed in trapezoidal fuzzy numbers are applied to assess weights and ratings of supplier selection criteria. Then a hierarchy multiple model based on fuzzy set theory is expressed and fuzzy positive and negative ideal solutions are used to find each supplier’s closeness coefficient. Finally, a linear programming model based on the coefficients of suppliers, buyer’s budgeting, suppliers’ quality and capacity constraints is developed and order quantities assigned to each supplier according to the linear programming model. The integrated model is illustrated by an example in a textile firm.     

Supplier selection in the airline retail industry using a funnel methodology: Conjunctive screening method and fuzzy AHP

Since a company can only perform as well as it is allowed to by its suppliers, the importance of supplier selection in supply chain management has been increasingly recognized. Supplier selection can best be described as a highly complex process, due to the involvement of many, sometimes conflicting, qualitative and quantitative criteria. The objective is to select the most suitable supplier(s) that meet a company’s specific needs. This paper investigates supplier selection in the airline retail industry. We discuss a number of issues that make airline retail complex and distinguish it from conventional retail. The supplier selection problem is solved by means of a two-phased methodology. In the first phase, a conjunctive screening method is used, which aims to reduce the initial set of potential suppliers prior to the comprehensive final choice phase. In the second phase, a fuzzy analytic hierarchy process (AHP) is used, in which suppliers are evaluated against the main criteria and sub-criteria. By combining the decision-maker’s preferences, using the developed methodology will eventually result in a ranking of suppliers that makes it possible to select the most suitable supplier(s). The proposed methodology is applied to one of the largest airlines in Europe, the Royal Dutch Airlines (KLM), and the results are discussed extensively in this paper. We conclude by proposing avenues for future research regarding the general applicability and further extensions.     

Using data mining synergies for evaluating criteria at pre-qualification stage of supplier selection

A company must purchase a lot of diverse components and raw material from different upstream suppliers to manufacture or assemble its products. Under this situation the supplier selection has become a critical issue for the purchasing department.The selection of suppliers depends on number of criteria and the challenge is to optimize selection process based on critical criteria and select the best supplier(s). During supplier selection process initial screening of potential suppliers from a large set is vital and the determination of prospective supplier is largely dependent on the criteria chosen of such pre-qualification. In the literature, many judgments based methods are proposed and derived criteria selection from the opinion of either the customers or the experts. All these techniques use the knowledge and experience of the decision makers. These methods inherit certain degree of uncertainty due to complex supply chain structure. The extraction of hidden knowledge is one of the most important tools to address such uncertainty and data mining is one such concept to account for such uncertainty and it has been found applicable in many scenarios. The proposed research aims to introduce a data mining approach, to discover the hidden relationships among the supplier’s pre-qualification data with the overall supplier rating that have been derived after observation of previously executed work for a period of time. It provides an overview that how supplier’s initial strength influence its final work performance.     

Co-development of product and supplier platform

The platform strategy has been implemented to efficiently manage the increased variety in products and manufacturing systems domains by achieving their effective and rapid re-configuration. Despite the increased development of platforms research, their back-end issues such as the supply chain and supplier selection have received little attention. In this research, a methodology that integrates the product platform synthesis with the selection of suppliers to form a supplier platform is introduced. The formed supplier platform is a collection of suppliers capable of supplying the components/modules of the product platform. The supplier platform remains unchanged for product generations, and non-platform suppliers are added or removed as needed for producing different product variants in different production periods. The presented co-development methodology consists of three phases. First, co-platforming is used to map the product requirements to the supplier’s domain; then an intuitionistic fuzzy TOPSIS method is employed to assign weights to the suppliers according to selected criteria. The suppliers are chosen next and their platform is synthesized. A laptop product family is used to illustrate the developed methodology. The significance of this research is the synthesis of a supplier platform which can be used without change for many product variants and many product generations. Its implementation enables the planning and creation of strategic alliances with the product platform suppliers.     

An integrated model for green supplier selection under fuzzy environment: application of data envelopment analysis and genetic programming approach

Supplier evaluation plays a critical role in a successful supply chain management. Hence, the evaluation and selection of the right suppliers have become a central decision of manufacturing business activities around the world. Consequently, numerous individual and integrated methods have been presented to evaluate and select suppliers. The current literature shows that hybrid artificial intelligence (AI)-based models have received much attention for supplier evaluation. Integrated data envelopment analysis–artificial neural network (DEA–ANN) is one of the combined methods that have recently garnered great attention from academics and practitioners. However, DEA–ANN model has some drawbacks, which make some limitation in the evaluation process. In this study, we aim at improving the previous DEA–AI models by integrating the Kourosh and Arash method as a robust model of DEA with a new AI approach namely genetic programming (GP) to overcome the shortcomings of previous DEA–AI models in supplier selection. Indeed, in this paper, GP provides a robust nonlinear mathematical equation for the suppliers’ efficiency using the determined criteria. To validate the model, adaptive neuro-fuzzy inference system as a powerful tool was used to compare the result with GP-based model. In addition, parametric analysis and unseen data set were used to validate the precision of the model.     

两阶段多供应商选择采购模型

针对如何从众多供应商中选择出适合需求的供货商进行准时采购这一问题,提出两阶段多供应商选择采购模型。利用层次分析方法对各个供应商按照定性准则进行分析评价,利用定量准则所建立的多供应商选择采购的成本优化模型对初步选择的供应商做进一步选择,从而确定最终的供货商及供货数量。实际应用结果表明,该模型不但能使企业选择出符合要求的供货商,而且能使企业降低采购成本和产品成本。     

A comparison between Fuzzy AHP and Fuzzy TOPSIS methods to supplier selection

Supplier selection has become a very critical activity to the performance of organizations and supply chains. Studies presented in the literature propose the use of the methods Fuzzy TOPSIS (Fuzzy Technique for Order of Preference by Similarity to Ideal Solution) and Fuzzy AHP (Fuzzy Analytic Hierarchy Process) to aid the supplier selection decision process. However, there are no comparative studies of these two methods when applied to the problem of supplier selection. Thus, this paper presents a comparative analysis of these two methods in the context of supplier selection decision making. The comparison was made based on the factors: adequacy to changes of alternatives or criteria; agility in the decision process; computational complexity; adequacy to support group decision making; the number of alternative suppliers and criteria; and modeling of uncertainty. As an illustrative example, both methods were applied to the selection of suppliers of a company in the automotive production chain. In addition, computational tests were performed considering several scenarios of supplier selection. The results have shown that both methods are suitable for the problem of supplier selection, particularly to supporting group decision making and modeling of uncertainty. However, the comparative analysis has shown that the Fuzzy TOPSIS method is better suited to the problem of supplier selection in regard to changes of alternatives and criteria, agility and number of criteria and alternative suppliers. Thus, this comparative study contributes to helping researchers and practitioners to choose more effective approaches for supplier selection. Suggestions of further work are also proposed so as to make these methods more adequate to the problem of supplier selection.     

A new DEA method for supplier selection in presence of both cardinal and ordinal data

The success of a supply chain is highly dependent on selection of best suppliers. These decisions are an important component of production and logistics management for many firms. Little attention is given in the literature to the simultaneous consideration of cardinal and ordinal data in supplier selection process. This paper proposes a new integrated data envelopment analysis (DEA) model which is able to identify most efficient supplier in presence of both cardinal and ordinal data. Then, utilizing this model, an innovative method for prioritizing suppliers by considering multiple criteria is proposed. As an advantage, our method identifies best supplier by solving only one mixed integer linear programming (MILP). Applicability of proposed method is indicated by using data set includes specifications of 18 suppliers.     

Sustainable supplier selection: A ranking model based on fuzzy inference system

In these days, considering the growth of knowledge about sustainability in enterprise, the sustainable supplier selection would be the central component in the management of a sustainable supply chain. In this paper the sustainable supplier selection criteria and sub-criteria are determined and based on those criteria and sub-criteria a methodology is proposed onto evaluation and ranking of a given set of suppliers. In the evaluation process, decision makers’ opinions on the importance of deciding the criteria and sub-criteria, in addition to their preference of the suppliers’ performance with respect to sub-criteria are considered in linguistic terms. To handle the subjectivity of decision makers’ assessments, fuzzy logic has been applied and a new ranking method on the basis of fuzzy inference system (FIS) is proposed for supplier selection problem. Finally, an illustrative example is utilized to show the feasibility of the proposed method.     

An integrated fuzzy MCDM approach for supplier evaluation and selection

A fuzzy multi-criteria group decision making approach that makes use of quality function deployment (QFD), fusion of fuzzy information and 2-tuple linguistic representation model is developed for supplier selection. The proposed methodology seeks to establish the relevant supplier assessment criteria while also considering the impacts of inner dependence among them. Two interrelated house of quality matrices are constructed, and fusion of fuzzy information and 2-tuple linguistic representation model are employed to compute the weights of supplier selection criteria and subsequently the ratings of suppliers. The proposed method is apt to manage non-homogeneous information in a decision setting with multiple information sources. The decision framework presented in this paper employs ordered weighted averaging (OWA) operator, and the aggregation process is based on combining information by means of fuzzy sets on a basic linguistic term set. The proposed framework is illustrated through a case study conducted in a private hospital in Istanbul.     

An integrated model for closed-loop supply chain configuration and supplier selection: Multi-objective approach

Reverse logistics consists of all operations related to the reuse of products. External suppliers are one of the important members of reverse logistics and closed loop supply chain (CLSC) networks. However in CLSC network configuration models, suppliers are assessed based on purchasing cost and other factors such as on-time delivery are ignored. In this research, a general closed loop supply chain network is examined that includes manufacturer, disassembly, refurbishing, and disposal sites. Meanwhile, it is managed by the manufacturer. We propose an integrated model which has two phases. In the first phase, a framework for supplier selection criteria in RL is proposed. Besides, a fuzzy method is designed to evaluate suppliers based on qualitative criteria. The output of this stage is the weight of each supplier according to each part. In the second phase, we propose a multi objective mixed-integer linear programming model to determine which suppliers and refurbishing sites should be selected (strategic decisions), and find out the optimal number of parts and products in CLSC network (tactical decisions). The objective functions maximize profit and weights of suppliers, and one of them minimizes defect rates. To our knowledge, this model is the first effort to consider supplier selection, order allocation, and CLSC network configuration, simultaneously. The mathematical programming model is validated through numerical analysis.     

An effective supplier selection method for constructing a competitive supply-relationship

We propose an effective supplier selection method to maintain a continuous supply-relationship with suppliers. Costs have been sharply increasing and profit decreasing as the global competition among companies has increased and customer demands have diversified in the current business environment. Many other functions are now outsourced globally to strengthen competition. As a result, one of the issues is how to select good suppliers which can maintain a continuous supply-relationship.

We suggest a mathematical programming model that considers the change in suppliers' supply capabilities and customer needs over a period in time. We design a model which not only maximizes revenue but also satisfies customer needs. The suggested model is applied to supplier selection and management of the agriculture industry in Korea.     

A comprehensive study of the relationship between enterprise resource planning selection criteria and enterprise resource planning system success

We developed a conceptual framework for investigating how ERP selection criteria are linked to system quality and the service provided by suppliers and consultants, and thus how these influenced ERP implementation success. Through a cross-sectional survey of the top 5000 largest companies in Taiwan, using a balanced scorecard concept and path analysis, we showed that four system selection criteria (consultant's suggestion, a certified high-stability system, compatibility between the system and the business process, and the provision of best practices) were positively related to system quality. Three supplier selection criteria (international market position, training support by the supplier and supplier technical support and experience) had a significant influence on supplier service quality, and two consultant selection criteria (consultant's ERP implementation experience in a similar industry and consultant's support after going live) were related to consultant service quality. However, we found that most organizations did not consider all these criteria when implementing ERP systems. Our study also suggested that enhanced system quality and service quality could increase user perspective and ERP success.     

Group decision making process for supplier selection with VIKOR under fuzzy environment

During recent years, how to determine suitable suppliers in the supply chain has become a key strategic consideration. However, the nature of supplier selection is a complex multi-criteria problem including both quantitative and qualitative factors which may be in conflict and may also be uncertain. The VIKOR method was developed to solve multiple criteria decision making (MCDM) problems with conflicting and non-commensurable (different units) criteria, assuming that compromising is acceptable for conflict resolution, the decision maker wants a solution that is the closest to the ideal, and the alternatives are evaluated according to all established criteria. In this paper, linguistic values are used to assess the ratings and weights for these factors. These linguistic ratings can be expressed in trapezoidal or triangular fuzzy numbers. Then, a hierarchy MCDM model based on fuzzy sets theory and VIKOR method is proposed to deal with the supplier selection problems in the supply chain system. A numerical example is proposed to illustrate an application of the proposed model.     

Structured methodology for supplier selection and evaluation in a supply chain

Supply chain management (SCM) is one of the most important competitive strategies used by modern enterprises. The main aim of supply chain management is to integrate various suppliers to satisfy market demand. Meanwhile, supplier selection and evaluation plays an important role in establishing an effective supply chain. Traditional supplier selection and evaluation methods focus on the requirements of single enterprises, and fail to consider the entire supply chain. Therefore, this study proposes a structured methodology for supplier selection and evaluation based on the supply chain integration architecture.In developing the methodology for supplier selection and evaluation in a supply chain, enterprise competitive strategy is first identified using strengths weaknesses opportunities threats (SWOT) analysis. Based on the competitive strategy, the criteria and indicators of supplier selection are chosen to establish the supplier selection framework. Subsequently, potential suppliers are screened through data envelopment analysis (DEA). Technique for order preference by similarity to ideal solution (TOPSIS), a multi-attribute decision-making (MADA) method is adapted to rank potential suppliers. Finally, the Taiwanese textile industry is used to illustrate the application and feasibility of the proposed methodology.This study facilitates the improvement of collaborator relationships and the management of potential suppliers to help increase product development capability and quality, reduce product lifecycle time and cost, and thus increase product marketability.     

Intelligent evaluation of supplier bids using a hybrid technique in distributed supply chains

The main idea of this research is to devise the smart module to pick the best supplier bid(s) automatically. The hybrid model is composed of three useful tools: fuzzy logic, AHP, and QFD. The approach has been carefully implemented and verified via a real-world case study in a medium-to-large industry manufacturing vehicle tires and other rubber products. A collection of 12 assessment criteria classified into two categories have been considered. Eight factors are derived from customer suggestions and the other four are design specifications required to manufacture the product. The main outcomes are: a hybrid autonomous model to evaluate supplier bids without direct human intervention; devising a hybrid three-module method and overcoming complexity of computations in resulting algorithm by means of agents; outlining the best criteria to assess suppliers; evaluating the suppliers based on voice of customer during all stages of the process; and discussing analysis, design, and implementation issues of the evaluation agent. The paper includes implications for development of an integrated total system for supply chain coordination. The most important advantages of this work over earlier researches on supplier selection are: implementation of an autonomous assessment mechanism using intelligent agents for the first time, making the best out of three widely applied methodologies all at once, evaluation process mainly based on features of customer order, coordination of supply job based on a bidding system, and portal-mediated operation and control.     

A green supplier selection model for high-tech industry

With growing worldwide awareness of environmental protection, green production has become an important issue for almost every manufacturer and will determine the sustainability of a manufacturer in the long term. A performance evaluation system for green suppliers thus is necessary to determine the suitability of suppliers to cooperate with the firm. While the works on the evaluation and/or selection of suppliers are abundant, those that concern environmental issues are rather limited. Therefore, in this study, a model for evaluating green suppliers is proposed. The Delphi method is applied first to differentiate the criteria for evaluating traditional suppliers and green suppliers. A hierarchy is constructed next to help evaluate the importance of the selected criteria and the performance of green suppliers. Since experts may not identify the importance of factors clearly, the results of questionnaires may be biased. To consider the vagueness of experts’ opinions, the fuzzy extended analytic hierarchy process is exploited. With the proposed model, manufacturers can have a better understanding of the capabilities that a green supplier must possess and can evaluate and select the most suitable green supplier for cooperation.     

An innovative integration of fuzzy-logic and systems dynamics in sustainable supplier selection: A case on manufacturing industry

Globally, supply chains compete in a complex and rapidly changing environment. Hence, sustainable supplier selection has become a decisive variable in the firm’s financial success. This requires reliable tools and techniques to select the best sustainable supplier and enhance understanding about how supplier behavior evolves with time. System dynamics (SD) is an approach to investigate the dynamic behavior in which the system status alterations correspond to the system variable changes. Fuzzy logic usually solves the challenges of imprecise data and ambiguous human judgment. Thus, this work presents a novel modeling approach of integrating information on supplier behavior in fuzzy environment with system dynamics simulation modeling technique which results in a more reliable and responsible decision support system. Supplier behavior with respect to relevant sustainability criteria in the past, current and future time horizons were sourced through expert interviews and simulated in Vensim to select the best possible sustainable supplier. Simulation results show that an increase in the rate of investment in sustainability by the different suppliers causes an exponential increase in total sustainability performance of the suppliers. Also, the growth rate of the total performance of suppliers outruns their rate of investment in sustainability after about 12 months. A dynamic multi-criteria decision making model was presented to compare results from the systems dynamics model.     

Supplier Selection Based on a Neural Network Model Using Genetic Algorithm

In this paper, a decision-making model was developed to select suppliers using neural networks (NNs). This model used historical supplier performance data for selection of vendor suppliers. Input and output were designed in a unique manner for training purposes. The managers' judgments about suppliers were simulated by using a pairwise comparisons matrix for output estimation in the NN. To obtain the benefit of a search technique for model structure and training, genetic algorithm (GA) was applied for the initial weights and architecture of the network. The suppliers' database information (input) can be updated over time to change the suppliers' score estimation based on their performance. The case study illustrated shows how the model can be applied for suppliers' selection.