Supplier Selection Model Based on Risk in an Indonesian Healthcare Service Industry

Abstract

In Indonesia, healthcare services are a priority industry sector. In the last few periods, every health care provider began to evaluate and make a performance improvement of the entire supply chain. Supplier selection is one of supply chain business process that have some risks. Therefore, this research is conducted to identify and reduce various risks in supplier selection process. The method used is Fuzzy Failure Mode and Effect Analysis (FFMEA) with three main stages, i.e. fuzification, rule evaluation and difuzification. The result show that there are four criteria, i.e. price, communication, quality and delivery time used for supplier selection in an Indonesian healthcare industry. Each criterion has some supplier performance risks with a total of 10 failure modes. The integration of risk factors in supplier selection model have been successfully done with one best suppliers based on the lowest risk score.