The Application of Multiple Attribute Decision Making Methods in Grading the Suppliers of Iran Tractor Manufacturing Company

Subject Areas : Business Management

Soleyman Iranzadeh ¹ , Hossein Bevrani ² , Babak Sarami Rasouli ³

1 - Assistant Professor, Department of Management, Tabriz Branch, Islamic Azad University, Tabriz, Iran
2 - Assistant Professor of Academic Degree, Department of Statistics, Tabriz University
3 - Master of Science in Industrial Management

Received: 2007-12-12 Accepted : 2008-06-15 Published : 2008-06-21

Keywords: Entropy, Normalization, Multiple Attribute Decision Making, Compromising Groups,

Abstract :

Surveying the supplying market, as well as choosing the most proper supplier, is one of the most important activities in every organization and company. Neglecting the conditions of parts and raw material supply or disregarding cooperation with the suppliers would lead to an increase in purchase costs, quality control costs, and quality guarantee costs. All the mentioned costs would eventually make the customer dissatisfied with the final goods and services. In ranking the suppliers and choosing them as suppliers, several criteria and factors should be considered. In this paper, in order to rank and evaluate the suppliers of Iran Tractor Manufacturing Company (ITMCo), we have studied the methods and models of multiple attribute decision making, and eventually, have chosen the proper model. The research population consists of the experts of parts-supplying department of ITMCo. First, the important criteria evaluating and ranking the suppliers of ITMCo. Were determined based on library Study and interviewing the experts. Then, by using a questionnaire and based on the Shanon Enteropy Method the importance rate of each criterion was specified. Studying the multiple attribute decision making models showed that TOPSIS model is the most suitable model for ranking the suppliers of ITMCo. The parts needed in ITMCo in 2005 (1384) are divided in to 6 main categories: 1) Completed forged and cast parts 2) Completed parts 3) Completed machined parts 4) half-completed forged and cast parts 5) half-completed sheeted parts 6) half-completed machined parts. Since studying all the mentioned groups is not feasible in this paper, we have confined our study only to the ranking of the suppliers of the first category, the completed forged and cast parts.

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