A fuzzy supplier selection model with the consideration of benefits, opportunities, costs and risks

  • Authors:

  • Amy H. I. Lee

  • Affiliations:

  • Department of Industrial Engineering and System Management, Chung Hua University, No. 707, Sec. 2, WuFu Road, Hsinchu, Taiwan

  • Venue:
  • Expert Systems with Applications: An International Journal
  • Year:
  • 2009

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Abstract

Even though the research on supplier selection is abundant, the works usually only consider the critical success factors in the buyer-supplier relationship. However, the negative aspects of the buyer-supplier relationship must also be considered simultaneously. The main objective in this study is to propose an analytical approach to select suppliers under a fuzzy environment. A fuzzy analytic hierarchy process (FAHP) model, which incorporates the benefits, opportunities, costs and risks (BOCR) concept, is constructed to evaluate various aspects of suppliers. Multiple factors that are positively or negatively affecting the success of the relationship are analyzed by taking into account experts' opinion on their importance, and a performance ranking of the suppliers is obtained. TFT-LCD manufacturers in Taiwan, which is the largest TFT-LCD producer country in the world, are facing increasing competition nowadays, and the selection of the most appropriate suppliers for cooperation is essential for firms to achieve competitive advantage. A case study of backlight unit supplier selection for a TFT-LCD manufacturer is presented, and the proposed model is applied to facilitate the decision process. The model is a general form that can be tailored and applied by firms that are making decisions on supplier selection.