Application of AHP and FAHP Algorithm for Supplier Development Evaluation

Abstract

Implementation of supplier development (SD) is appropriate for a firm that intends to reduce costs and streamline its operations while minimising defective products. However, the number of practices involved in the SD program is too large, making them difficult to manage. Conventionally, the selection of decisions is based on multicriteria and is often complex and unstructured. Thus, this paper proposed the Analytic Hierarchy Process (AHP) and Fuzzy Analytic Hierarchy Process (FAHP) methodologies to evaluate and select SD practices. Both methods produced the same result. The results obtained can be indicated by the production professionals as guidelines to look for the opportunity to implement the SD program to improve the capabilities of their suppliers.