W9._Norbert Eze_ Selecting Suppliers by Using Non-compensatory Models

W9._Norbert Eze_ Selecting Suppliers by Using Non-compensatory Models

By norberteze on December 29, 2012

I.      PROBLEM RECOGNITION, DEFINITION AND EVALUATION

A supply chain manager of NETCO has instructed me to carry out selection of a best supplier to purchase some materials from. Supplier selection method I am going to adapt to is multiattribute decision-making problem. Table..1 shows the desired attributes to assist me in the alternatives evaluation of the suppliers. The following tools below I will be used to achieve the best choice of suppliers from four alternatives….suppliers A, B, C and D.:

      i.        Dominance

     ii.        Satisficing

    iii.        Disjunctive resolution

   iv.        Lexicography.

The above tools are tools that make up Non Compensatory models. Non-compensatory models are models used often to mostly helpful in eliminating inferior alternatives from the analysis. It is refer non-compensatory because trade-offs among attributes are permissible. Comparisons of alternatives must be judged on an attribute-by-attribute basis.

II.    DEVELOPMENT OF FEASIBILITY ALTERNATIVES

Summary of information of feasibility alternatives are shown in the table below. The attributes are equally shown in Table..1. with their scores

Applying Dominance Tools:

Dominance is a useful screening method for eliminating inferior alternatives from the analysis. Usually it is will not be possible to select the best alternative based on dominance alone. Below table is analysis carried on dominance basis. Check for Dominance among alternatives is shown on the table Table..2. Pair-wise comparison of each supplier with set attributes was inspected and Supplier B dominated.

Applying Dominance method, in Table…2 proved clearly that Supplier B dominates Supplier A based on the quality of products. Supplier A will be dropped for consideration

Applying Satisficing Tools:

Satisficing, sometimes referred to as the method of feasible ranges, requires the establishment of minimum or maximum acceptable values (the standard) for each attribute. Alternative having one or more attributes values that fall outside the acceptable limits are excluded from further consideration. See table…3 by bounding the permissible values of attributes from two sides (or from one) information processing requirements are substantially reduced, masking the evaluation problem more manageable. From the table we can deduce that the analysis is not producing satisficing result since all the alternatives are unacceptable but Supplier B is more preferable since capacity is almost lowest in strength.

Applying Disjunctive Resolution:

The disjunctive method is similar to satisficing in that it relies on computing the attributes of each alternative to the standard. If an alternative has just one attribute that meets or exceeds the standard, that alternative is kept. In satisficing, all attributes must meet or exceed the standard in order for an alternative to be kept in the feasible set. See table…4 Ordinal Ranking of Suppliers Attributes. The easiest way to obtain a consisttent ordinal ranking is to make paired comparison between each possible attribute combination. By ranking each attribute can be to the number of times it appears on the right-hand side of the comparison. The ranking in table...4 is Quality>experiences>Reputation>Capacity>Skill.

.

Lexicography

The tools ensure that the model is particularly suitable for decision situations in which a single attribute is judged to be more important than all other attributes. Lexicography requires that the importance of each attribute be specified to determine the order in which attributes are to be considered. See table..5 Evaluation using application of Lexicography is super because it select the final best choice.

  

III.   DEVELOPMENT OF OUTCOMES FOR EACH ALTERNATIVE

·      Applying Dominance method, in Table…2 proved clearly that Supplier B dominates Supplier A and others based on the quality of products. Supplier A will be dropped for consideration even other suppliers. With dominance it possible to select the best supplier from.

·     The outcome using Feasible Ranges for Satisfcing, proved that comparisons of attributes values for each suppliers against the feasible range reveals that Supplier C and D cannot be selected because they are below the threshold of Experience, Quality and so on.

·     Ordinal ranking of supplier attributes range Supplier C as zero because the management skill of Supplier C is weighing lowest.

·      Lexicography has proven that Supplier B > Supplier C > Supplier A > Supplier D. Supplier with Quality is the best of all.

IV.  SELECTION OF A CRITERION (OR CRITERIA)

The use of Lexicography model was adopted in Tab. 5 to get to the highest ranked attribute (resulting to Supplier B selection).

      Similarly from tab. 2, checking for Dominance, Supplier B dominated all.

     So the application of Dominance and Lexicography models gave me the same results admirable result.

V.    ANALYSIS AND COMPARISON OF THE ALTERNATIVES

Lexicography model gave me the best alternative because the attributes were ranked in order of importance.

VI.  SELECTION OF PREFERRED ALTERNATIVE

As already explained above the Supplier B has the highest ranked value and dominated all the other alternatives, so it is the preferred alternative for this case study.

VII. PERFORMANCE MONITORING AND POST-EVALUATION OF RESULT

The application of Lexicography and Dominance model is a really a good performance monitoring tool in the sense that they ranked all the alternatives in their order of importance.

References:

1.     Purdue OWL APA style. (2011). APA formatting and style guide, pg (10). Retrieved from http://owl.english.purdue.edu/owl/resource/560/19

2.      Sullivan, W. G., Wicks, E.M., & Koelling, C.P. (2012). Engineering economy, (15th ed.)  (Chapter 1) (pp. 23-37)  (Chapter 14) (pp. 573-583)

3.      Howard Technology Middle East (2012). Operating Cost Estimating and Financial Analysis, ( 2012) (Selection 7) (pp. 1-7)

4.      AACE International. (2012). Skill & Knowledge of Cost Engineering, (5th ed.)  (Selection 5) (Chapter 23) (pp. 23.1-23.10) (Chapter 24) (pp. 24.1-24.5)