Multi-criteria selection of allied transportation firm: An application in plastic industry

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Multi-criteria selection of allied transportation firm: An application in plastic industry

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Abstract

Transportation is a critical process in supply chains which includes receiving raw material from suppliers and sending products to customers. Companies usually face the problem of selecting the proper transportation contractor to transfer their raw material and finished goods. However, this decision is normally challenging. This problem is influenced by several factors such as time, flexibility, safety and economic factors. Moreover, companies are increasingly aware of they need to work together with their logistics partners in order to best serve their customers and achieve business excellence. The aim of this research is to propose a two-phase multi-criteria decision-making (MCDM) approach to evaluate strategic transportation allies effectively. In this paper, the allied transportation firm selection problem is formulated as a multi-attribute decision-making (MADM) model. We also have employed fuzzy logic for ratings and the evaluations. A case study in plastic production industry is also presented to demonstrate the potential and applicability of the method.

Keywords: Supply chain, Transportation contractor selection, Fuzzy, Multi-Criteria decision-Making, Strategic alliances

Abstract
Introduction
Evaluation criteria
Methodology
1. Analytical hierarchy process
2. Fuzzy extension of TOPSIS
Case study
Conclusion
References

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[...] However, a vast number of alliances fail to success due to a number of various reasons. Therefore, identifying causes of failures as well as the selection of the appropriate partner for strategic alliance can lead to high degree of performance in the business environment (Arino, 2003; Dacin et al, 1997; Lee and Cavusgil, 2006). However, the selection of a suitable partner (i.e. transportation firm) for strategic alliance in a logistics value chain is not an easy decision and is associated with uncertainty and complexity. [...]

[...] Levitas, (1997), Selecting partners for successful international alliances: Examination of US and Korean firms; Journal of World Business 3–16. Delaney R.V., (1991), Trends in logistics and U.S. world competitiveness, Transportation Quarterly, 19-41. Doz Y., and G. Hamel, (1998), Alliance Advantage: The Art of Creating Value through Partnering; Harvard Business School Press, Boston. Erensal Y.C., T.O. Oncan, and M.L. Demircan, (2006), Determining key capabilities in technology management using fuzzy analytic hierarchy process: A case study of Turkey; Information Sciences, 176: 2755–2770. Ertugrul and A. Tus, (2007), Interactive [...]

[...] The multi-objective treatment transportation firm selection and developing the group decision-support system should also be added in the transportation firm selection problems REFERENCES Arino A., (2003), Measures of strategic alliance performance: An analysis of construct validity; Journal of International Business Studies 66–79. Bozbura F.T., and A. Beskese, (2007), Prioritization of organizational capital measurement indicators using fuzzy AHP; International Journal of Approximate Reasoning, 44: 124–147. Bozbura F.T., A. Beskese, and C. Kahraman, (2007), Prioritization of human capital measurement indicators using fuzzy AHP, Expert Systems with Applications, 32: 1100–1112. [...]

[...] According to Miller (1956), most decision makers are not able to analyze more than 7 to 9 factors simultaneously when making a decision. Thus, it is necessary to break down the complex problem into more manageable sub problem (Chan and Kumar, 2007). With respect to the large number of factors influencing the decision, we conduct the problem through a four level of hierarchy. The main objective which is placed in the first level of the hierarchy is the selection of the most efficient transportation company. The main criteria, sub-criteria (attributes) and transportation company options will be placed in the later levels. [...]

[...] Rank the best alternatives according to the C value in descending order CASE STUDY The problem discussed here is concerned with a Plastics production company, looking for the most appropriate allied transportation firm for supplying its raw materials and delivering the finished goods to the customers. The company wants to take into account all the possible important criteria which can affect the decision regarding the best transportation firm. Therefore, three alternative transportation firms are determined and evaluation is done base upon the discussed criteria and attributes. [...]

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