An integrated approach for supplier selection in MTS and BTO SC

Abstract

Most MNCs follow worldwide sourcing through global supply chains to secure market share and surge profits. Make to stock (MTS) and Make to order (MTO) / Build to order (BTO) are two extremes in the sense that with one all production begins well before demand is received whereas with the other production begins only after demand is known. Most of the methods pick various prevailing criteria for supplier selection problem (SSP) from current literature. There are very limited studies which validate supplier selection criteria used for evaluation. Right supplier selection can make notable impact on assimilation of the supply chain relationship. Effective and accurate supplier selection decisions are important tools for supply chain management in many organizations to enhance their supply chain performance. This paper proposes a framework to select an integrated multi criteria decision-making method to find select suppliers in both MTS and BTO environment. To evaluate and validate relevant criteria for SSP, Decision Making Trial and Evaluation Laboratory (DEMATEL) technique is utilized. Depending upon supply chain environment use of appropriate multi criteria scoring technique like DEA or ANP is proposed. An illustrated example in BOSC environment is also presented to support the suggested methodology.