Ahp model for the selection of partner companies in virtual enterprises

Abstract

Rising product variety and complexity, shorter time frames to respond, and the continual need to gain new capabilities through innovativeness force the trend of outsourcing to be replaced by strategic alliances, where enterprises or individuals work together towards a common goal and share their responsibilities as well as their profits. Recent developments in information technology have enabled relatively inexpensive, reliable and fast networking to support such alliances in real time. In this context, the virtual enterprise (VE) represents an appropriate cooperation alternative and competitive advantage for the enterprises. VE is a temporary network of independent companies - suppliers, customers, even rivals - linked by information technology (IT) to share skills, costs and access to one another's markets. In this emerging business model of virtual enterprise, the decision support functionality, which addresses issues such as partner company selection, is an important domain to be studied. In this paper, we propose an analytic hierarchy process model to contribute in the selection of the partner companies in the virtual enterprises. A case example is also covered to validate the feasibility of the adoption of the model in virtual enterprise situations. © 2007 Springer-Verlag London Limited.