Abstract
Cost reduction and multi sourcing program is one of the ways used by companies to survive in business competition. Supplier selection process conducted by PT. MTM aims to get suppliers capable of supplying the needs in a sustainable manner with quality products and competitive prices. The company needs a method to select suppliers that can supply upper arm and lower arm components for pantograph jack products. The research is done through analyzing supplier selection process by PT. MTM, examines the criteria used, and then implements the AHP and TOPSIS methods in the process to gain alternative supplier priorities and reduced purchase costs. To speed up data processing, this study utilizes Expert Choice 11 software. The result of analysis using AHP and TOPSIS is two suppliers will supply the components in PT. MTM.Keywords: AHP, multi sourcing, cost reduction, panthograph jack, supplier, TOPSIS
Highlights
The selection of suppliers in the era of globalization is no longer just a matter of comparing the price of the acquisition of goods, but has been far more complex
To complete the data to be processed using the Analytical Hierarchy Process (AHP) and TOPSIS methods, interviews were conducted with parties directly related to the procurement process, namely with the purchasing manager and supplier development team consisting of purchasing staff, engineering staff and quality staff
Decision Making Model From interviews with all party that involved in selection process, and refer to criteria described by Weber (Weber, 1991), there are five criteria that should be used by Menara Terus Makmur (MTM) in selecting suppliers, namely price criteria, quality criteria, production facilities & capacity criteria, technical capabilities criteria and delivery criteria
Summary
The selection of suppliers in the era of globalization is no longer just a matter of comparing the price of the acquisition of goods, but has been far more complex. Menara Terus Makmur (MTM) is a manufacturing company in which one of the products produced is the pantograph jack. When this research was conducted, customers of the pantograph jack product asked MTM to reduce the selling price of the product by 30% from the previous year's selling price. This makes MTM must evaluate the cost structure of making the pantograph jack product and reduce the cost of the manufacturing process and the purchase of its components
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