Supplier Selection in an Agile Manufacturing Environment using DEA and ANP

M. Asif Hasan, R. Shankar, and J. Sarkis

International Journal of Logistics Systems and Management, Vol. 4, No. 5, pp. 523-550, 2008.

Supplier selection is one of the most important activities of organizations, where the short- and long-term success of a buyer organization depends on proper selection of its suppliers. The current competitive environment has placed increasing competitive pressures on the suppliers to match the needs of the buyer(s) in terms of quantity, quality, product-mix, cost, time, and place of delivery, to name a few performance measures.  Part of this importance relates to the focus on competitive supply chains and extended enterprises.  Part of this influence requires the adoption of agile manufacturing practices requiring its suppliers to also have agile attributes.  This study designs and implements a procedure for judging the suitability of suppliers for an organization competing on agile manufacturing characteristics.  Quantitative and qualitative factors will need to be used to appraise and select appropriate suppliers to fit within an organization’s agility practices.  In seeking to achieve this task the synergistic integration of two techniques the analytical network process (ANP) and data envelopment analysis (DEA) will be applied in a multi-phased supplier selection approach.  Initially ANP is executed to appraise the suppliers on their qualitative benefits, generating quantitative data from these qualitative dimensions. Secondly, DEA is used to synthesize the data to arrive at a ranking of the suppliers.  The technique is validated in a small company case study.


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