In this case study, you will be working on a supplier ranking problem. It is an actual application for a manufacturing company located in Tijuana, Mexico. Because of confidentiality issues, the data given here have been disguised. The supplier selection criteria and subcriteria have been defined by the Purchasing Manager as shown in Figure 5.12. Note that Flexibility, Process Capability (Cpk Index), and Service have to be maximized, while the other criteria have to be minimized. The company is considering 21 potential suppliers and the supplier data with respect to the criteria are given in Table 5.44.

Questions:

a. Scale the supplier criteria values using linear normalization (simple linearization).

b. Using the scaled values from part (a), apply the L2 metric method to rank the suppliers.

c. Determine the criteria/subcriteria weights using the following methods (use your own judgment):
i. Rating method.
ii. Pairwise comparison of criteria/subcriteria and Borda method.
iii. AHP. Test the consistency of all pairwise comparison matrices.

d. Using the weights obtained in part

(c) and the scaled supplier data in part (a), determine the supplier rankings by all three methods.

e. Compare the supplier rankings obtained by L2 metric, rating method, Borda method, and AHP. Discuss any rank reversals.

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Criteria Flexibility Subcriteria FIGURE 5.12 Quality Process capability Supplier selection Price Defective parts Service Distance Delivery Lead time