A Group Decision Approach for Supplier Selection Problem Based on a Multi-criteria Model

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The aim of this paper is to develop a group decision approach for the supplier selection problem. Suppose that a manager wants to purchase a set of devices based on the offer of a few suppliers such that several constraints are met. The proposed decision support approach combines a group decision method that calculates the performance devices and the selection risk associated with it, as well as a Multi-Objective model for the supplier selection. Every single device is evaluated by a group of evaluators across a certain set of criteria. The divergent opinions of the evaluators generate the selection risk related to the respective portfolio of devices. A new Multi-Objective model for the supplier selection problem is formulated. It has two objective functions: risk minimization and performance maximization. Starting from the aforementioned model a minimum risk model with budget and performance constraints has been formulated. A case study connected with the purchase of certain medical devices has been conducted and the related numerical results have been analysed. Our approach can help managers in the purchasing management. Based on it a software module can be realized and embedded in a decision support system.
Supplier selection problem, Group decision approach, Multi-objective, Risk minimization model, Weights