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The performance evaluation of existing suppliers using data envelopment analysis

Author

Listed:
  • Seong-Jong Joo
  • George H. Messer Jr.
  • Ronald Bradshaw

Abstract

For any supply chain management activity to operate effectively, there must be some method of monitoring supplier performance and the metrics in place to provide visibility of performance. Many different methods have been developed over the years to aid in this effort. In the literature, there are numerous examples for the application of various decision tools to aid in the selection of new suppliers or the evaluation of multiple suppliers of the same commodity. This study is an attempt to evaluate and score a focal company's existing suppliers of various commodities. The goal is to rate the suppliers comparatively using common measurable characteristics. An anonymous midsize manufacturing company in the aerospace industry has provided a full year of historical data on its 30 largest Tier 1 suppliers to aid this work. This study applies Data Envelopment Analysis (DEA) to the supplier data and results in the comparative rankings of supplier performance.

Suggested Citation

  • Seong-Jong Joo & George H. Messer Jr. & Ronald Bradshaw, 2009. "The performance evaluation of existing suppliers using data envelopment analysis," International Journal of Services and Operations Management, Inderscience Enterprises Ltd, vol. 5(4), pages 429-443.
    • Handle: RePEc:ids:ijsoma:v:5:y:2009:i:4:p:429-443
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