Taguchi Loss Function in Intuitionistic Fuzzy Sets along with Personal Perceptions for the Sustainable Supplier Selection Problem

Abstract

Sustainability, a new interdisciplinary paradigm, can be defined as a standard in terms of economic, environmental and social awareness of a company. In many applications, theoretical sustainability models considering the importance of three aspects equally differed from models used in practice. A sustainable supplier selection problem generally contains many conflicting information and the imprecise decision makers’ knowledge, and decision makers can judge suppliers based on their first impression. Hence, in this study, a sustainable supplier selection problem of a plastic packaging company in Turkey is taken into account under an expert-based model and a theorical-based model for three scenarios which consider personal perceptions of decision makers. First, an intuitionistic fuzzy set-based method is applied to the problem using two different distance measurement approaches, namely, fuzzy normalized Euclidean distance and the Taguchi loss function, for which an alternative method is proposed. Then, suppliers are ranked and the validity of the results is also checked using the Pearson product–moment correlation coefficient. The results indicate that (i) the personal perception of decision makers has an inevitable impact on results, (ii) the proposed approach can capture the associated uncertainties embedded in decision makers and fuzzy environment, and (iii) there is a disparity between the theory and the reality of sustainability.