Supplier Selection Case Study Essay

3780 Words Jan 3rd, 2011 16 Pages
Applied Mathematical Modelling 31 (2007) 2475–2486 www.elsevier.com/locate/apm

Analytic network process in supplier selection: A case study in an electronic firm
Cevriye Gencer *, Didem Gurpinar ¨
Gazi University, Faculty of Engineering and Architecture, Department of Industrial Engineering, 06570 Maltepe/Ankara, Turkey Received 1 November 2005; received in revised form 1 August 2006; accepted 9 October 2006 Available online 8 December 2006

Abstract Supplier selection, which is the first step of the activities in the product realization process starting from the purchasing of material till to the end of delivering the products, is evaluated as a critical factor for the companies desiring to be successful in nowadays competition
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[10]. ¸ 2. Analytic network process Many decision problems cannot be building as hierarchical because of dependencies (inner/outer), influences between and within clusters (criterias, alternatives). ANP is very useful to solve this kind of problems. ANP provides a general framework to deal with decisions without making assumptions about the independence of higher-level elements from lower level elements and about the independence of the elements within a level. In fact ANP uses a network without the need to specify levels as in a hierarchy [15]. ANP is firstly introduced by Saaty, which is based on 1-9 scale, in his book named ‘‘The Analytic Hierarchy Process’’ (1980). After that, Thomas L. Saaty developed this issue in his published book named ‘‘The Analytic Network Process’’ (1996). Saaty suggested the usage of AHP to solve the problem of independence on alternatives or criteria and the usage of AHP to solve the problem of dependence among alternatives or criteria. The structural difference between AHP (hierarchy) and ANP (network) is also shown in Fig. 1. As it seen from the figure a hierarchy is the simple and special case of a network.

(a)
Goal

(b)

X

Y

Fig. 1. (a) Structure of AHP, (b) Structure of ANP.

C. Gencer, D. Gurpinar / Applied Mathematical Modelling 31 (2007) 2475–2486 ¨

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Nodes of the network represent components of the system, arcs denote interactions between them. In order to build the decision

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