A supply risk reduction model using integrated multicriteria decision making

Thomas Kull, Srinivas Talluri

Research output: Contribution to journalArticle

156 Scopus citations

Abstract

Risk management in supply chains is receiving increasing attention in both academia and industry. Firms are recognizing the importance of considering supply risk in evaluating and selecting suppliers for strategic partnerships. One of the critical issues faced by purchasing managers is in effectively defining, operationalizing, and incorporating supply risk measures in the supplier evaluation process. Due to the multidimensional nature of supply risk, analytical tools that can effectively integrate various risk measures into the decision process can prove useful for managers. To this end, the contribution of this paper is twofold. First, we consider extant research in supply risk in developing a framework for risk assessment based on various categories and types of risks. Second, we propose a combination of analytic hierarchy process and goal programming as a decision tool for supplier selection in the presence of risk measures and product life cycle considerations. The efficacy of the model is tested at a mid-sized automotive supplier and managerial implications are discussed.

Original languageEnglish (US)
Pages (from-to)409-419
Number of pages11
JournalIEEE Transactions on Engineering Management
Volume55
Issue number3
DOIs
StatePublished - Aug 15 2008

Keywords

  • Analytic hierarchy process (AHP)
  • Case analysis
  • Goal programming (GP)
  • Product life cycle (PLC)
  • Risk management
  • Supplier selection
  • Supply chain risk

ASJC Scopus subject areas

  • Strategy and Management
  • Electrical and Electronic Engineering

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