Fuzzy multi-objective vendor selection under lean procurement

This paper investigates a fuzzy multi-objective vendor selection program under lean procurement based on cost minimization, delivery schedule violation minimization, and maximizing the quality level of the purchased quantity. Specifically, the paper incorporates the vendor production capacity uncertainty into the model to identify an appropriate selection policy for vendors under practical operating conditions. The use of a soft time-window mechanism for the vendor selection model enables decision makers to further incorporate a time based performance metric for vendor evaluation, based on the degree of urgency or need for a part. A solution algorithm using fuzzy AHP is proposed. The results of a numerical example suggest that decision makers prefer vendors who can promise tighter delivery schedules rather than on cost or quality. A sensitivity analysis of the soft time-window on the achievement of the lean procurement objectives is also conducted.

► We model a vendor selection problem under lean procurement environment. ► We incorporate the capacity uncertainty to identify an appropriate selection policy. ► Vendors who can promise tighter delivery schedules are preferable.