Risk analysis for the supplier selection problem using failure modes and effects analysis (FMEA)

Simon Li () and Wei Zeng
Additional contact information
Simon Li: University of Calgary
Wei Zeng: University of Calgary

Journal of Intelligent Manufacturing, 2016, vol. 27, issue 6, No 12, 1309-1321

Abstract: Abstract While seeking for global suppliers is a general trend for lower cost and better quality, it is not trivial for a company to assess the corresponding risks in supplier selection. This paper proposes the supplier selection method that applies failures modes and effects analysis (FMEA) to assess the risks in the decision process. As each supplier is evaluated under the common multi-criteria framework, risks are viewed as the possible deviations from expected performance, and they are interpreted as failure modes in risk analysis. Following the concepts of FMEA, each failure mode is examined with respect to the possible causes and effects. This method generates two technical deliverables for supporting risk analysis. Firstly, the FMEA document is developed to support the team’s discussion of supplier risks and accumulate the risk knowledge within the company. Secondly, the ranking numbers based on FMEA (i.e., risk priority numbers) are utilized to evaluate a discount on a supplier’s performance according to their risk level. A real-case example about selecting methanol suppliers in the global market is used to demonstrate the proposed method for risk analysis in practice.

Keywords: Supplier selection; Risk analysis; Failure modes and effects analysis (FMEA) (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://link.springer.com/10.1007/s10845-014-0953-0 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:joinma:v:27:y:2016:i:6:d:10.1007_s10845-014-0953-0

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/10845

DOI: 10.1007/s10845-014-0953-0

Access Statistics for this article

Journal of Intelligent Manufacturing is currently edited by Andrew Kusiak

More articles in Journal of Intelligent Manufacturing from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().