A fuzzy multi-criteria decision making model for supplier selection

Abstract

This paper presents a hybrid fuzzy model for group Multi Criteria Decision Making (MCDM). A modified fuzzy DEMATEL model is presented to deal with the influential relationship between the evaluation criteria. The modified DEMATEL captures such relationship and divides the criteria into two groups, particularly, the cause group and the effect group. The cause group has an influence on the effect group where such influence is used to estimate the criteria weights. In addition, a modified TOPSIS model is proposed to evaluate the criteria against each alternative. Here, a fuzzy distance measure is used in which the distance from the Fuzzy Positive Ideal Solution (FPIS) and Fuzzy Negative Ideal Solution (FNIS) are calculated. The resulted distances were used to calculate the similarity to Ideal and Anti-ideal points. Later, an optimal membership degree (closeness coefficient) of each alternative is computed to estimate to which extent an alternative belongs to both FPIS and FNIS. The closer the degree of membership to FPIS and the farther from FNIS the more preferred the alternative. The membership degree is obtained by the optimization of a defined objective function that measures the degree to which an alternative is similar/dissimilar to the Ideal/Anti-Ideal solutions. The closeness coefficient is used to rank the alternatives. To better have a high contrast between the ranks of alternatives an optimization problem was introduced and solved to maximize the contrast. The presented hybrid model was applied on an industrial case study for the selection of cans supplier/suppliers at Nutridar Factory in Amman-Jordan to demonstrate the proposed model. Finally a sensitivity analysis is introduced to verify the resulting ranks of the available suppliers via testing different values of the used parameters. The sensitivity analysis has shown robust and valid results that are close to real preferences of the consulted experts.