An integrated approach for supplier selection

Abstract

This research is emphasized to develop a quantitative approach for assessing supply chain resilience under disruption environment, which incorporates an analytical framework in supply chain design. A three-stage framework is developed on supply chain quality, configuration and technology management. This is based on a survey of the perceptions of practicing managers from an OEM (original equipment manufacturer). The three-stage process involves empirical assessment of strategic supply chain quality, configuration and technology variables and then using quality function deployment to deploy them to improve the competitiveness of the supply chain. The focus of this multi-dimensional approach is on the selection of a suitable supplier considering multi-criteria by integrating Quality Function Deployment (QFD) tool with Technique for Order Preference by Similarity to Ideal Solution TOPSIS. A number of decision determinants for supply chain resilience have been chosen as technical requirements and customer criteria's. Furthermore, analytical hierarchy process (AHP) has also been embedded to deal with linguistic judgments expressing relationships and correlations required in QFD. TOPSIS is used to develop the ranking of a number of suppliers considering different multi-dimensional parameters in a uniform system. To illustrate the practical implications of the methodology, the approach are exemplified with the help of a case study in the automobile OEM scenario. This concept has helped in decision making in the occurrence of disruption on the performance of the supply chain system. Based on the strategic model developed, some very interesting managerial insights are offered with respect to the effect of cost efficient operations and resiliency in volatile or competitive global market scenario for choosing alternate suppliers, which in turn affects the overall supply chain performance. Finally decision maker's perception has taken an important role for the supplier selection i.e., whether he is much more worry about cost or rational to pay moderately for developing a resilient system in the supply chain. © 2012 Published by Elsevier Ltd.