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Sourcing analytics for evaluating and selecting suppliers using DEA and AHP: a case of the aerospace company

Author

Listed:
  • Seong-Jong Joo
  • Bradley C. Boehmke
  • Hokey Min
  • Ozden Bayazit

Abstract

Sourcing represents one of the most upstream supply chain activities, which often dictates the rest of downstream supply chain activities. As such, a poor sourcing decision has a significant trickle-down effect on the effectiveness of a buying firm's manufacturing and logistics decisions. Considering such significance, it is imperative for the firm to make a wise, systematic decision in evaluating and selecting suppliers. To support a critical sourcing decision, we propose a supplier evaluation decision-aid tool within the framework of business analytics, which takes in to account the multiple facets of supplier performance evaluation criteria. As a core of such a tool, we develop a relatively new model that is capable of considering both objective and subjective performance criteria simultaneously using a combination of data envelopment analysis (DEA) and analytic hierarchy process (AHP). To verify the practicality and validity of the proposed analytics-based tool, we applied it to an actual problem facing a US aerospace company.

Suggested Citation

  • Seong-Jong Joo & Bradley C. Boehmke & Hokey Min & Ozden Bayazit, 2020. "Sourcing analytics for evaluating and selecting suppliers using DEA and AHP: a case of the aerospace company," International Journal of Services and Operations Management, Inderscience Enterprises Ltd, vol. 35(4), pages 461-481.
    • Handle: RePEc:ids:ijsoma:v:35:y:2020:i:4:p:461-481
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