Article Preview
Top1. Introduction
Supply chain management (SCM) has become an indispensable competitive strategy in acquiring and sustaining organizational productivity and profitability (Gunasekaran, Patel, & McGaughey, 2004). Carter and Narasimhan (1993) emphasize the significance of purchasing in the supply chain stating that ‘purchasing issues, strategies, and tactics are just as important as marketing, finance, accounting, and operational issues even though purchasing is first in the value chain and furthest from the actual delivery of the product or service to the customer’ (Carter & Narasimhan, 1993 in Cheraghi, Dadashzadeh, & Subramanian, 2004, p.91). This remains to be a fact and becoming even more relevant (Caniato, Luzzini, & Ronchi, 2014) in today’s, dynamic and competitive business environment, where the ‘the advent of the Internet commerce and its impact on customer expectations’ (Cheraghi et al., 2004, p.91) has only made its effects more distinguishable in ensuring the long-term supply chain competitiveness and thus viability of a firm (Cheraghi et al., 2004; Yang, 2010; Ku, Chang, & Ho, 2010).
As Görener (2008, p.31) puts it ‘The most important function of a purchasing department is to provide the required materials at the right time, right quantity and requested quality at the least cost from the right supplier for the organization’. This is the core reason why supplier selection and evaluation have become indispensable in today’s goods and service producing industries.
Performance management has proven to produce positive change in organizational systems and processes (Pinheiro de Lima, Gouvea da Costa, Angelis, & Munik, 2013), and thus, it has become one of the most widely recognized managerial processes (Bititci, Ackermann, Ates, Davies, Garengo et al., 2011) both in the manufacturing (e.g. Gomes, Yasin, & Lisboa, 2004; Chen, 2008; Bititci, Firat, & Garengo, 2013; Van Horenbeek & Pintelon, 2014) and service (e.g. Brignall & Modell, 2000; Sotirakou & Zeppou, 2006; Moxham & Boaden, 2007; Oztemel & Salmona, 2009) sectors. Consequently, with the intention of bringing a potential practical solution to the multi-criteria decision making problem of supplier evaluation (Agarwal, Sahai, Mishra, Bag, & Singh, 2011); a supplier performance evaluation process using the Six Sigma DMAIC methodology has been proposed in this paper.
Six Sigma ‘has evolved from scientific management and continuous improvement theories by combining the finest elements of many former quality initiatives’ (Aboelmaged, 2010, p.268). Among its many definitions reflecting different perspectives (Schroeder, Linderman, Liedtke, & Choo, 2008; Aboelmaged, 2010), the authors have chosen to adopt Linderman, Schroeder, Zaheer, and Choo’s (2003, p.195) definition stating that ‘Six Sigma is an organized and systematic method for strategic process improvement and new product and service development that relies on statistical methods and the scientific method to make dramatic reductions in customer defined defect rates’.