Interactive selection model for supplier selection process: An analytical hierarchy process approach

Abstract

Supplier Selection Process (SSP) becomes increasingly important for most manufacturing firms as it helps to reduce directly cost to the bottom line. The selection process involves the determination of quantitative and qualitative factors so as to select the best possible suppliers. It is essential to identify the relationship with the suppliers in terms of tangible factors. Owing to subjective human judgement in determining the relative importance of those selection factors, a method called Chain of Interaction is proposed to solve the problems associated with the dynamic nature of supply chain management. Focusing on the goodwill of an Analytic Hierarchy Process, an Interactive Selection Model is suggested to systemize the earlier steps, such as the determination of buyer-supplier relationships and formation of selection criteria, before the implementation of the Analytic Hierarchy Process with the help of Multi-Criterion Decision Making software called Expert Choice. The proposed Interactive Selection Model can be applied to supplier selection through the identification of buyer-supplier interactions and the valid data-collection methods. A numerical example is presented and the pros and cons of the model examined to seek further modification.