Using ANP and ELECTRE Methods for Supplier Selection: Cable Industry Application

Abstract

Business has to perform their activities in increasingly competitive environment due to emerging technologies and globalization. To be successful in this competitive environment, they have to make decisions to ensure superiority over its competitors. One of the important decisions for the future of the business is the selection of right suppliers. The right selection of suppliers that will provide the necessary resources will be an advantage to businesses. Choosing the right supplier will lead to increase in product quality, decrease in costs, to increase customer satisfaction and production flexibility. Therefore, accurate and impartial manner in the selection of suppliers is a necessity. In this study, supplier selection problem is discussed for business operating in the cable industry.Supplier selection, due to the excess of the criteria for effective decision-making and the alternative, is defined as \"Multi-Criteria Decision Making Problem\". Different methods have been developed to solve the multi-criteria decision making problem. In this study, “Analytic Network Process (ANP)” and “Elimination Et Choix Traduisant La Realité (ELECTRE)” methods were used to complement each other and this integrated method as applied to the selection of suppliers for a cable manufacturing company operating in Samsun. Supplier selection criteria used in the study have been identified as the 6 main criteria and 19 sub-criteria in accordance with the literature. These criteria may be both qualitative and quantitative. The weight of criteria were determined by taking into account the opinions of experts. The information obtained from them were used as input for Super Decision program for ANP approach. Then weights of the criteria and the performance of seven suppliers for each criteria have been used as input for ELECTRE method. The required calculations were made for the application of ELECTRE method using Microsoft Excel 2010 program. As a result of these calculations suppliers were evaluated and ranked. Thus it was determined the best supplier for business.