A Multi-Criteria Intuitionistic Fuzzy Group Decision Making Method for Supplier Selection with VIKOR Method

Introduction

Supplier selection is a fundamental issue of supply chain area which heavily contributes to the overall supply chain performance. Particularly for companies who spend a high percentage of their sales revenue on parts and material supplies, and whose material costs represent a larger portion of total costs, savings from supplies are of particular importance

These, strongly urge for a more systematic and transparent approach to purchasing decision making, especially regarding the area of supplier selection. Selecting the suppliers significantly reduces the purchasing cost and improves corporate competitiveness, and that is why many experts believe that the supplier selection is the most important activity of a purchasing department. Supplier selection is the process by which suppliers are reviewed, evaluated, and chosen to become part of the company’s supply chain. The major aims of supply chain management are to reduce supply chain risk, reduce production costs, maximize revenue, improve customer service, optimize inventory levels, business processes, and cycle times, and resulting in increased competitiveness, customer satisfaction and profitability (Chou & Chang, 2008; Ha & Krishnan, 2008; Heizer & Render, 2004; Monczka et al., 2001; Simchi-Levi et al., 2003; Stevenson, 2005). Indeed supplier selection is a multiple criteria decision- making (MCDM) problem affected by several conflicting factors such as price, quality and delivery.

Several factors affect a supplier’s performance. Dickson (1996), Ellram (1990), Roa and Kiser (1980), and Stamm and Golhar (1993) identified, respectively 60, 18, 13 and 23 criteria for supplier selection. One of the well-known studies on supplier selection belongs to Dickson (1966) who identified 23 important evaluation criteria for supplier selection. Weber et al. (1992) reviewed and classified 74 articles addressed the supplier selection problem.