Managing supplier selection problem with integrated fuzzy AHP and fuzzy VIKOR: A manufacturing company case

Abstract

The ability of businesses to gain a strong place in the sector in which they operate is directly related to the effective management of each member of the supply chain. In the globalizing world with increasing competitive conditions, businesses have to manage their supply chains efficiently to be successful in the market. Companies should improve their strategies by rapidly adapting to the new circumstances formed by various crises such as wars, climate change, or pandemics. The high performance of a business is greatly correlated with the performance of its suppliers. Therefore, supplier selection by evaluating supplier performance is a Multi-Criteria Decision-Making (MCDM) problem that simultaneously includes many qualitative and quantitative factors. In this article, the performances of the suppliers of a Turkish small-medium enterprise (SME) operating in the manufacturing sector during COVID-19 are evaluated using an integrated fuzzy MCDM technique. Despite its importance, supplier selection is less considered for SMEs. The purpose of including fuzzy logic in the study is to ensure that linguistic expressions are converted into fuzzy numbers to overcome uncertainty and subjectivity. Four supplier alternatives are evaluated by four main criteria, and in total by eleven sub-criteria determined by expert opinions. The weights of the performance criteria are obtained by the Fuzzy Analytic Hierarchy Process (FAHP), and the performance ranking of the suppliers is determined by the fuzzy VIKOR. The absence of a manufacturing sector-based study on SMEs operating in Turkey during the COVID-19 period constitutes the main motivation