An Analytic Hierarchy Process Approach For Supplier Evaluation and Selection In a Steel Manufacturing Company (original) (raw)
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THE ANALYTICAL HIERARCHY PROCESS IN THE SUPPLIER SELECTION PROBLEM
2000
The Supplier Selection Problem (SSP) consists of analyzing and measuring the performance of a set of suppliers in order to rank and select them for improving the competitiveness of the whole supply system. As many conflicting factors should be taken into account in the analysis, the problem can be tackled using multi-criteria models and methods. In this work a careful scrutiny of the papers appeared on international scientific journals in the recent years about SSP is provided. The survey highlights that the most used methodology is the Analytical Hierarchy Process (AHP). Thus, an overview view of the current proposals based on AHP and its variants to cope with the SSP is provided. Crucial aspects which arise when the methodology is actually applied in real cases are identified and discussed.
Journal of Scientific Research & Reports, 2014
Every organization needs suppliers and no organization can exist without suppliers. Therefore, the organizations approach to suppliers and the selection of the appropriate supplier, its acquisition processes and policies, and its relationships with suppliers, is of vital importance, both to organizations and suppliers alike. No organization can be successful without the support of its supplier base, operationally and strategically, short or long-term.To select the best supplier, it is essential to make an analytical decision based upon tangible and intangible criteria. Chose and management of a supplier has to be congruent with organizational strategy. Therefore, the vision and strategy of the manufacturer are the key drivers for how the supply function will be managed and how supply decisions are made and exectuted. The proposed model in this study was applied in a steel manufacturing company in Malaysia with the goal of reducing time in choosing the correct supplier for the company. This study aims to provide a systematic model stimulating correct supplier selection using the Fuzzy Analytic Hierarchy Process (FAHP) method along with a series of sensitivity analyses which were conducted using the Expert Choice (EC) program to evaluate the impact of changes in the priority of criteria for the
Using Analytical Hierarchy Process (AHP) to Build Suppliers' Selection Model
The analytical Hierarchy process (AHP) is a multi-criteria decision making approach (MCDMA) can be used to solve complex decision problems. This study aimed to use this objective tool to build suppliers' selection model, utilizing competitive priorities "quality, cost, delivery and flexibility" as an evaluation and selection criteria. The researcher has developed an evaluation questionnaire distributed to a simple random sample of functional managers in the chemical industries sector companies enlisted in Amman Stock Exchange, the relative importance degrees were measured for main criteria "competitive priorities" from the perspective of those managers to identify their attitudes when selecting suppliers, the study concluded that the quality is the most important criterion among competitive priorities criteria for selecting and evaluating suppliers as it got a percentage of 0.53 of the general sum, followed by cost criterion that got a percentage of 0.22 so the two criteria have got 0.75 percentage. In the light of what the study has concluded, the researcher recommended the necessity of using Analytical Hierarchy Process in making decisions of selecting suppliers especially in chemical industries sector, and other industrial sectors as well, due to what this approach has of advantages and features for making complex decisions.
Designing a computational tool for supplier selection using analytical hierarchy process
With increasingly competitive global world markets, companies are under intense pressure to find ways to cut production and material costs to survive and sustain their competitive position. Since a qualified supplier is a key element and a good resource for a buyer in reducing such costs at optimum material quality, evaluation and selection of the right suppliers is critical to maintain competitiveness. This decision becomes more complicated in case of multiple suppliers, multiple conflicting criteria, and imprecise parameters. Most supplier selection models consider the buyer’s viewpoints and maximise only the buyer’s advantages and thus do not necessarily lead to an optimal situation for business competitiveness. This paper deals with a multi attribute decision model using AHP for the justification of supplier selection, explore the factors influencing the supplier selection, the relationship between the identified factors and the firm’s performance with reference to manufacturing industries in Bhubaneswar City.
Hybrid analytical hierarchy process model for supplier selection
Industrial Management & Data Systems, 2008
Purpose -This paper aims to propose a new approach called "analytical hierarchy process weighted fuzzy linear programming model (AHP-FLP)" for supplier selection. Design/methodology/approach -A hybrid method of supplier selection, AHP-FLP is applied to a real industry case. The weights of the various criteria, taken as local weights from a given judgment matrix, are calculated using analytical hierarchy process (AHP) that are also considered as the weights of the fuzzy linear programming model. This new model is compared with the classical AHP method. Findings -This study concluded that the AHP-FLP method outperforms the AHP method for supplier selection with respect to restricted supplier selection criteria. Drawing on a real case, Supplier 1 was identified to be the best supplier through the AHP model under no restrictions, which contradicts the finding that Supplier 2 was selected as the best supplier by the AHP-FLP model subject to constraints. Research limitations/implications -More research is definitely called for within the context of studying a more complex supply chain with multiple supply network and nodes. There is also a crucial need for investigating other hybrid methods to find the optimum supplier. Practical implications -The findings of this study indicate that the weights of supplier selection criteria calculated by the AHP-FLP model are in line with the actual supplier selection decision of purchasing managers. Since the AHP-FLP model is relatively more difficult to implement compared with the crisp AHP, its application will be more appropriate for high-value components where stringent purchasing criteria are required. In contrast, AHP remains an appropriate approach for relatively lower value components (C class). Originality/value -The novelty of this study lies in the application of a hybrid approach to a real industry case. This study has dealt with one of the most important subjects in supply chain management, providing a better decision for supplier selection using appropriate quantitative techniques.
The Analytic Hierarchy Process in the Supplier Selection Problem
Proceedings of the International Symposium on the Analytic Hierarchy Process, 2009
The Supplier Selection Problem (SSP) consists of analyzing and measuring the performance of a set of suppliers in order to rank and select them for improving the competitiveness of the whole supply system. As many conflicting factors should be taken into account in the analysis, the problem can be tackled using multi-criteria models and methods. In this work a careful scrutiny of the papers appeared on international scientific journals in the recent years about SSP is provided. The survey highlights that the most used methodology is the Analytical Hierarchy Process (AHP). Thus, an overview view of the current proposals based on AHP and its variants to cope with the SSP is provided. Crucial aspects which arise when the methodology is actually applied in real cases are identified and discussed.
Supplier selection in supply chain using analytical hierarchy process
International Journal of Productivity and Quality Management, 2013
Supplier selection is an important constituent in supply chain management. Supply chain management emphasises on evaluation and selection of supplier against multiple criteria rather than cost as a single criteria. Multi criterion includes both qualitative and quantitative criteria. In this paper, we have proposed analytical hierarchy process model, to evaluate and rank the potential supplier, supplying copper component (busbar), to a multinational organisation, engaged in designing, manufacturing and delivering a range of products covering various stages of power transmission and distribution system. AHP is a four step decision analysis model which converts the qualitative factor of supplier transferred into the quantitative measure reliability and a decision making method for ranking alternative course of action when multiple criteria must be considered.
International Journal of Advanced Operations Management, 2017
A good supplier is a key resource for an organisation in reducing costs, improving productivity and quality of the product. Hence, selection of potential suppliers has become an important task of supply chain management. Traditionally, procurement is considered as buying the material at cheapest price and maximizes the buyer's profit. But this does not necessarily lead to an optimal situation for all members of a supply chain. This paper attempts to propose an analytical framework for supplier evaluation and selection using analytical hierarchy process (AHP) and linear programming problem (LPP). Supplier selection process includes evaluation of multiple criteria and various constraints associated with them. A case of auto parts manufacturing firm is analysed. After analysing the case, the suppliers were ranked based on their performance using AHP technique and LPP is then adopted to determine the optimum quantity to be procured from each of the best ranked supplier.
Jurnal Sistem dan Manajemen Industri, 2019
PT. GMT has a mission to deliver the products to the customer on time and high-quality products to improve services. Sometimes, the delivery of product delays caused by the raw materials delays or didn't meet specifications. Selection optimal suppliers of raw materials are one of the solutions. There are two factors must be considered for the selection of suppliers, qualitative factors and quantitative factors. In this study, for qualitative factors, based on the criteria needed by PT GMT. This research produces three Linear Programming models, first: a qualitative objective function that will be maximized called the Total Value of Purchase (TVP). TVP is an integration of the Analytical Hierarchy Process (AHP) and Mix Integer Programming Integration. Second, the quantitative objective function for the procurement cost of raw materials, which is called the Total Cost of Purchase (TCP). The third is to optimize qualitative and quantitative simultaneously using the Goal Programming...