Integration of DEMATEL, ANP and DEA methods for third party logistics providers’ selection

Abstract

In a competitive environment many companies usually outsource their logistics functions to the Third Party Logistics (TPL) providers to focus on their core businesses. However, the selection of proper TPL provider is not an easy task because of conflicting quantitative and qualitative criteria. This study presents an integrated model based on three well-known methods Decision Making Trial and Evaluation Laboratory (DEMATEL), Analytical Network Process (ANP) and Data Envelopment Analysis (DEA) for the evaluation and selection of TPL providers. DEMATEL computes the effects between selection criteria while ANP derives the weights of each criterion related with TPL providers' selection problem. Finally DEA presents a mathematical model for ranking TPL providers alternatives with respect to various criteria. The application of integrated model is demonstrated with a case study. The novelty of this study comes from the fact that there is no research in the literature integrating DEMATEL, ANP and DEA for the TPL selection problems.