A hybrid AHP-FCM model for backup supplier selection in presence of disruption risk

Jafar Razmi, Meysam Arvan and Aschkan Omidvar

International Journal of Decision Sciences, Risk and Management, 2014, vol. 5, issue 3, 213-233

Abstract: Nowadays, owing to the globalisation phenomenon, organisations are encouraged to outsource their parts and services. Therefore, for making the best and the most accurate decisions, supplier selection by multi-criteria decision-making methods (MCDM) is an important part of the decision making process in companies and enterprises. Furthermore, due to dependency on a limited number of suppliers, numerous firms have encountered a huge loss of profit as a result of disruption. In order to prevent such losses, companies should predetermine some backup suppliers. In this study, a model which considers the selection of a backup supplier in the presence of disruption and delay risks is proposed. The model is a combination of fuzzy cognitive maps (FCMs) and analytical hierarchy process (AHP) methods. The former considers the interactions between the criteria in order to calculate their real impact in the problem, and then the output weights are accommodated to the disruption state by experts' views. The latter is the supplier selection process. Dickson criteria are used in the study and the model by considering the weights proposed by Dickson for each criterion. Finally, a numerical example is presented to demonstrate the proposed model's applicability.

Keywords: supplier selection; disruption risk; backup suppliers; fuzzy cognitive maps; FCMs; analytical hierarchy process; AHP; multicriteria decision making; MCDM; supply chain management; SCM. (search for similar items in EconPapers)
Date: 2014
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