Application of Fuzzy Based VIKOR Approach for Multi-Attribute Group Decision Making (MAGDM): A Case Study in Supplier Selection

Abstract

In today’s competitive global markets, selection of a potential supplier plays an important role to cut production costs as well as material costs of the company. This leads to successful survival and sustainability in a competitive marketplace. Therefore, evaluation and selection of an appropriate supplier has become an important part of supply chain management. The nature of the supplier selection process is a complex multi-attribute group decision making (MAGDM) problem which deals with both quantitative and qualitative factors may be conflicting in nature as well as contain incomplete and uncertain information. In order to solve such a kind of MAGDM problems, the development of an effective supplier selection model is evidently desirable. In this paper, an application of the VIKOR method combined with fuzzy logic has been used to solve supplier selection problems with confliting and non-commensurable (different units) criteria, assuming that compromising is acceptable for conflict resolution. The decision maker wants a solution, which must be closest to the ideal, and the alternatives are evaluated according to all established criteria. Linguistic values are used to assess the ratings and weights for the conflicting factors. These linguistic ratings can be expressed in triangular fuzzy numbers. Then, a hierarchy MAGDM model based on fuzzy sets theory and the VIKOR method has been proposed to deal with the supplier selection problems in the supply chain system. A case study has been illustrated as an application of the proposed model.