An application of fuzzy set theory to the external performance evaluation of distribution centers in logistics

Abstract

The purpose of this paper is to propose an algorithm for external performance evaluation in the area of logistics from retailers' viewpoint under fuzzy environment. The fundamental concepts we have adopted include the factor analysis, eigenvector method, fuzzy Delphi method, fuzzy set theory and multi-criteria decision-making method. We use factor analysis to condense twenty external performance sub-criteria into six criteria to construct the hierarchical structure of external performance evaluation of distribution centers. The fuzzy Delphi method is integrated with the eigenvector method to form a set of pooled weights of the extracted criteria. The concepts of triangular fuzzy number and linguistic variables are used to assess the preference ratings of linguistic variable, ‘importance’ and ‘appropriateness’. Through the hierarchy integration, we obtain the final scores of distribution centers' performance. Then we use a revised Chang and Chen's ranking method to rank the final scores of distribution centers for choosing the best distribution center in the area of logistic management.