A cost efficiency approach for strategic vendor selection problem under certain input prices assumption

Mehdi Toloo*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

16 Citations (Scopus)

Abstract

Strategic vendor selection problem (VSP) has been investigated in different purchasing literature during the last two decades. Indeed, senior purchasing managers always deal with such crucial decisions. Manufacturing managers in the global market are faced with challenging and complex tasks very similar to VSP. Increasing outsourcing and opportunity provided by automotive industry to the worldwide markets make these decisions, even more, complex. Various methodologies, from simple weighted scoring methods to complex mathematical programming models, are introduced to tackle the VSP. Data envelopment analysis (DEA) is a non-parametric method in operations research and economics for evaluating the productive efficiency of decision-making units (DMUs). This study utilizes the proposed approach in Toloo and Ertay (2014) to develop a method for finding the most cost efficient DMU when the prices are fixed and known. A case study of an automotive company located in Turkey is adapted from the literature to illustrate the potential application of the suggested approach.

Original languageEnglish
Pages (from-to)175-183
Number of pages9
JournalMeasurement: Journal of the International Measurement Confederation
Volume85
DOIs
Publication statusPublished - May 2016
Externally publishedYes

Keywords

  • Automotive industry
  • Certain input prices
  • Cost efficiency
  • Data envelopment analysis (DEA)
  • Vendor selection problem (VSP)

ASJC Scopus subject areas

  • Instrumentation
  • Electrical and Electronic Engineering

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