Group Decision Making Model for Selection of Performance Indicators for Sustainable Supplier Evaluation in Agro-Food Supply Chain

Abstract

Sustainable food production is of vital importance to ensure food security, enhanced stability, environmental protection, and economic development for any developing nation. In an Agro- Food Supply Chain (AFSC), joint efforts of all supply chain actors inclined towards sustainability can contribute significantly towards sustainable production. Suppliers, who are intermediaries between Food Processing Firm (FPF) and sub-suppliers or farmers, must follow the FPF’s sustainability practices at their own level, and they must monitor the enactment of these activities at their sub-supplier level. In this regard, the study focuses on developing a group consensus mathematical model to derive a broader set of performance indicators to evaluate a supplier’s competency in maintaining, monitoring, and tracing sustainable performance in his sub-supplier network. A two-phased group consensus model is presented; it selects performance indicators using the Delphi method and it utilizes a feedback mechanism rooted in Group Analytical Hierarchy Process. This system is based on an iterative algorithm to generate weights that all decision makers accept. The proposed model is illustrated with an analysis of an Indian flour milling company. Kendall’s concordance coefficient is employed to understand the degree of agreement among decision makers before and after the application of the proposed model. Increase in its value post-application validates the efficacy of the model. This approach for performance indicator selection for sustainable supplier evaluation research is unique in the field of AFSC. Results of the study indicate that the top ranking indicator is ‘Financial Strength’ followed by ‘Social Image’. Key policy implications are drawn from the result findings which can be further integrated to support sustainable growth and development of suppliers and sub-suppliers in any AFSC.