Suppliers ranking in production systems by Fuzzy TOPSIS method, case study: underground coal mines Resavica-Serbia

  • Goran Stojanović 1University "Union-Nikola Tesla" Belgrade – Faculty of applied sciences, Ul. Obrenoviceva 46, Nis, Serbia
  • Dejan Bogdanović
Keywords: Supplier Selection, Mining Systems, Multi-Criteria Analysis, Fuzzy TOPSIS, Ranking

Abstract

Selection and evaluation of suppliers is a complex issue that depends mostly on the quality of the decision-making process. The aim of this paper is to point to the possibility of applying multi-criteria analysis (Fuzzy TOPSIS method) for the selection of suppliers operating in mining systems in the case of the Public Company for Underground Coal Mining Resavica (JPPEU Resavica) -Serbia. Ranking of companies is done based on ten criteria, and it is considered a five suppliers (Supplier 1; Supplier 2; Supplier 3; Supplier 4; Supplier 5). The criteria cover the most important aspects of suppliers selection such as: management and organization, quality, technical ability, production facilities and capacity, financial position, delivery, service, relationship-connectivity, security and environmental protection and price. In doing so, it is used the experts knowledge from JPPEU Resavica to determine the significance and impact of certain criteria to the process of supplier selection and evaluation of suppliers in regard to each criterion. Fuzzy TOPSIS method was used for the final ranking of suppliers. The best elected supplier was the Supplier 4. The obtained results indicate that the proposed method gives excellent results and can be used for solving various, and the most complex problems that occur in mining systems, as well as in other production systems.

References

AHN, G. and HUR, S. (2016) Markov network model with unreliable edges. International Journal of Industrial Engineering, 23(3), pp. 174-182.

AISSAOUI, N., HAOUARI, M. and HASSINI, E. (2007) Supplier selection and order lot sizing modeling. Computers & Operations Research, 34, pp. 3516–3540.

BAI, C. and SARKIS, J. (2010) Integrating sustainability in to supplier selection with grey system and roughset methodologies. International Journal Production Economic, 124, pp. 252–264.

BARABAROSOG˘LU, G. and YAZGAC, T. (1997) An application of the analytic hierarchy process to the supplier selection problem, Production and Inventory Management Journal, pp. 14–21.

BIRCH, D. (2001) Corporate citizenship, rethinking business beyond corporate social responsibility. J. Andriof and M. McIntosh (eds.) Perspectives on corporate citiyzenship. London: Greenleaf Publishing. pp. 53-65.

CELEBI, D. and BAYRAKTAR D. (2008) An integrated neural network and data envelopmentanalysis for supplier evaluation under incomplete information, Expert Systems with Applications, 35 (4), pp. 1698–1710.

CHAN, F. T. S. (2003) Interactive selection model for supplier selection process: An analytical hierarchy process approach. International Journal of Production Research, 41, pp. 3549–3579.

CHEN, C. T., LIN, C. T. and HUANG, S. F. (2006) A fuzzy approach for supplier evaluation and selection in supply chain management. International Journal of Production Economics, 102, pp. 289–301.

CHOY, K. L. and LEE, W. B. (2002) A generic tool for the selection and management of supplier relationships in an outsourced manufacturing environment: the application of case based reasoning. Logist Information Management, 15, pp. 235–253.

CROOM, S. (2001) The dyadic capabilities concept: examining the processes of key supplier involvement in collaborative product development. European Journal of Purchasing and Supply Management, 7, pp. 29–37.

DE BOER, L., LABRO E. and MORLACCHI, P. (2001) A review of methods supporting supplier selection. European Journal Purch Supply Management, 7, pp. 75–89.

DEAGRAEVE, Z., LABRO, E. and ROODHOOFT, F. (2000) An evaluation of vendor selection models from a total cost of ownership perspective. European Journal of Operational Research, 125, pp. 34-58.

DICKSON, G. (1966) An analysis of vendor selection systems and decisions. Journal of Purchasing, 2, pp. 5-17.

EKICI, A. (2013) An improved model for supplier selection under capacity constraint and multiple criteria. International Journal Production Economic, 141, pp. 574–581.

ELLRAM L. (1990) The supplier selection decision in strategic partnerships. Journal of Purchasing and Material Management, 26(1), pp. 8–14.

ERHARDT, G., LANGLINAIS, T. and RATTA, V. (2010) The call to become customer smart. Technical Report Accenture.

ERTUĞRUL, İ. and KARAKAŞOĞLU, N. (2008) Comparison of fuzzy AHP and fuzzy TOPSIS methods for facility location selection, The International Journal of Advanced Manufacturing Technology, 39(7-8), pp. 783-795.

EVANS, R. H. (1980) Choice criteria revisited. Journal of Marketing, 44(1), pp. 55–56.

GHODSYPOUR, S. H. and O’BRIEN C. (1998) A decision support system for supplier selection using an integrated analytic hierarchy process and linear programming. International Journal of Production Economics, 56–57, pp. 199–212.

KAR, A. K. and PANI, A. K. (2014) How can a group of procurement experts select suppliers? An approach for group decision support. Journal of Enterprise Information Management, 27(4), pp. 337–357.

KUMAR, M., VRAT, P. and SHANKAR, R. (2006) A fuzzy programming approach for vendor selection problem in a supply chain. International Journal of ProductionEconomics, 101, pp. 273–285.

LEE, J., CHO, H. and KIM, Y. S. (2014) Assessing business impacts of agility criterion and order allocation strategy in multi-criteria supplier selection. Expert Systems with Applications, 42(3), pp. 1136–1148.

LEHMANN, D. R. and O’SHAUGHNESSY, J. (1974) Difference in attribute importance for different industrial products. Journal of Marketing, 38(2), pp. 36-42.

LI, C. C. and FUN, Y. P. (1997) A new measure for supplier performance evaluation. IIE Transactions, 29(1), pp. 753-758.

LIMA, F. R., OSIRO, L. and CARPINETTI, L. C. R. (2013) A fuzzy inference and categorization approach for supplier selection using compensatory and non-compensatory decision rules. Applied Soft Computing, 13, pp. 4133–4147.

LIN, H. T. and CHANG, W. L. (2008) Order selection and pricing methods using flexible quantity and fuzzy approach for buyer evaluation. European Journal of Operational Research, 187(2), pp. 415–428.

LIN, R. H. (2012) An integrated model for supplier selection under a fuzzy situation. International Journal of Production Economics, 138, pp. 55–61.

LIU, F. H. F. and HAI, H. L. (2005) The voting analytic hierarchy process method for selecting supplier. International Journal of Production Economics, 97, pp. 308–317.

MAFAKHERI, F., BRETON, M. and GHONIEM, A. (2011) Supplier selection order allocation: a two stage multiple criteria dynamic programming approach. International Journal of Production Economics, 132, pp. 52–57.

MEDINI, K. (2015) Modularity and variety spinoffs: a supply chain planning perspective. International Journal of Industrial Engineering, 22(6), pp. 753-768.

MENDOZA, A., SANTIAGO, E and, RAVINDRAN, A. R. (2008). A three-phase multicriteria methodto the supplier selection problem, International Journal of Industrial Engineering: Theory, Applications and Practice, 15 (2), pp. 195–210

MIEMCZYK, J., JOHNSEN, T. E. and MACQUET, M. (2012) Sustainable purchasing and supply management: a structured literature review of definitions and measures at the dyad, chain and net work levels. Supply Chain Management, 17, pp. 478–496.

MURALIDHARAN, C., ANANTHARAMAN, N. and DESHMUKH, S. G. (2002) A multi-criteria group decision-making model for supplier rating. Journal of Supply Chain Management, 38, pp. 22–33.

PRAHINSKI, C. and BENTON, W. C. (2004) Supplier evaluations: communication strategies to improve supplier performance. Journal of Operations Management, 22, pp. 39–62.

QIAN, L. (2014) Market-based supplier selection with price, delivery time, and service level dependent demand. International Journal of Production Economics, 147, pp. 697–706.

SHIN, H., COLLIER, D. A. and WILSON, D. D. (2000) Supplier management orientations andsupplier/buyer performance. Journal of Operations Management, 18, pp. 317–333.

SHIPLEY, D. D. (1985) Reseller’s supplier selection criteria for different consumer products. European Journal of Marketing, 19, pp. 26–36.

STOJANOVIĆ, S. G. (2016) Razvoj hibridnog višekriterijumskog modela u fazi okruženju za prioritizaciju pouzdanosti dobavljača u rudarskim sistemima. (PhD), Belgrade University-Technical faculty in Bor.

TALLURI, S. and NARASIMHAN, R. (2004) A methodology for strategic sourcing. European Journal of Operational Research, 154, pp. 236–250.

TALLURI, S. and NARASIMHAN, R. (2003). Vendor evaluation with performance variability: a max–min approach, European Journal of Operational Research, 146, pp. 543–552.

TAM, M. C. Y. and TUMMALAV, .M. R. (2001) An application of the AHP in vendor selection of a telecommunications system. OMEGA - The International Journal of Management Science, 29, pp. 171–182.

VANTEDDU, G., CHINNAM, R. B. and GUSHIKIN, O. (2011) Supply chain focus dependent supplier selection problem. International Journal of Production Economics, 129, pp. 204–216.

VERMA, R. and PULLMAN, M. E. (1998) An Analysis of the Supplier Selection Process. OMEGA - The International Journal of Management Science, 26, pp. 739-750.

VOKURKA, R. J., CHOOBINEH, J. and VADI, L. (1996) A prototype expert system for the evaluation and selection of potential suppliers. International Journal of Operations and Production Management, 16, pp. 106–127.

WANG, J. W., CHENG, C. H. and CHENG, H. K. (2009) Fuzzy hierarchical TOPSIS for supplier selection. Applied Soft Computing, 9, pp. 377–386.

WEBER, C. L., CURRENT, J. R. and BENTON, W. C. (1991)Vendor selection criteria and methods. European Journal of Operational Research, 50, pp. 2–18.

WEBER, C. H., CURRENT, J. R. and DESAI, A. (1998) Non-cooperative negotiation strategies for vendor selection, European Journal of Operational Research, 108, pp. 208–223.

WU, D. and OLSON, D. L. (2008) Supply chain risk, simulation, and vendor selection. International Journal of Production Economics, 114, pp. 646–655.

XIA, W. and WU, Z. (2007) Supplier selection with multiple criteria in volume discount environments. Omega, 35, pp. 494–504.

ZEYDAN, M., ÇOLPAN, C. and ÇOBANOGLU, C. (2011) A combined methodology forsupplier selection and performance evaluation. Expert Systems with Applications, 38, pp. 2741–2751.

ZHU, J. (2004) A buyer–seller game model for selection and negotiation of purchasing bids: extensions and new models, European Journal of Operational Research, 134, pp. 150–156.

Published
2021-06-30
How to Cite
Stojanović, G., & Bogdanović, D. (2021). Suppliers ranking in production systems by Fuzzy TOPSIS method, case study: underground coal mines Resavica-Serbia. Podzemni Radovi, (38), 27-45. https://doi.org/10.5937/podrad2138027S
Section
Articles

Most read articles by the same author(s)