A hybrid approach for supplier selection based on revised data envelopment analytic hierarchy process

Abstract

For most managers, purchasing decisions are key decisions in the achievement of business organisation's strategic objectives. Appropriate supplier selection is necessary as it fulfils these important objectives of the organisation by maximising overall value to the purchaser, reducing uncertainty in supply, and by forming a long term, reliable relationship between buyers and suppliers. Supplier selection being affected by several conflicting factors requires an appropriate multi-criteria decision making approach. One of the recent approaches used for supplier selection is a hybrid data envelopment analytic hierarchy process (DEAHP) approach. However, this approach suffers from serious drawbacks as it uses counter intuitive priority vectors for inconsistent pair wise comparison matrices and also at times, it generate illogical weights for consistent pair wise comparison matrices as well. The objective of this paper is to present a revised DEAHP (RDEAHP) approach to overcome these drawbacks of DEAHP. The uniqueness of the research lies in the application of RDEAHP approach for supplier selection problem.