An integrated approach of sustainable procurement and procurement postponement for the multi-product, assemble-to-order (ATO) production system
Mukherjee, Krishnendu
http://dx.doi.org/10.1590/0103-6513.191915
Production, vol.26, n2, p.249-260, 2016
Abstract
Postponement strategy is mainly used to handle the perceived variety and actual variety of product in the most cost effective way. However, postponement strategy has never been used by researchers in procurement to reduce cost and to enhance overall flexibility of the process. This paper gives a new concept of postponement, called procurement postponement, which is considered to be effective for the multi-product, assemble-to-order (ATO) system. A two-stage integrated approach of sustainable procurement and postponement method is proposed for the multi-product ATO production system to deal demand uncertainty, green house gas (GHG) emission, reliability of supply, level of disassembly and social issues of supplier selection with intuitionsitic fuzzy analytic hierarchy (IF-AHP) and multi-objective genetic algorithm (MOGA). Case study of an Indian company is discussed to use the proposed method by cost-emission-decision matrix.
Keywords
Intuitionsitic fuzzy set. AHP. MOGA. Cost-emission-decision matrix. Postponement strategy.
References
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Bowersox, D. J., & Closs, D. J. (1996). Logistical management, the integrated supply chain process. New York: Macmillan Publishing Company.
Brown, A. O., Lee, H. L., & Petrakian, R. (2000). Xilinx improves its semiconductor supply
chain using product and process postponement. Interfaces, 30(4), 65-80.
Chen, T. Y. (2011). A comparative analysis of score functions for multiple criteria decision making in intuitionistic fuzzy settings. Information Sciences, 181(17), 3652-3676. http://dx.doi.org/10.1016/j.ins.2011.04.030.
Cheng, T. C. E., & Podolsky, S. (1996). Just-in-time manufacturing: an introduction. 2nd ed. London: Chapman and Hall.
Chiou, J. S., Wu, L. Y., & Hsu, J. C. (2002). The adoption of form postponement strategy in a global logistics system: the case of Taiwanese information technology industry. Journal of
Business Logistics, 23, 107-124.
Christopher, M. (2000). The agile supply chain: competing in volatile markets. Industrial Marketing Management, 29(1), 37-44.
Department of Energy and Climate Change. (2009). Guidelines to Defra/DECC’s GHG conversion factors for company reporting: methodology paper for emission factors. London: DECC.
Ernst, R., & Kamrad, B. (2000). Evaluation of supply chain structures through modularization
and postponement. European Journal of Operational Research, 124, 495-510.
Freight Operations Information System. (2012). Retrieved in 01 January, 2015, from https://www.fois.indianrail.gov.in/FoisWebsite/html/Freight_Rates.htm
Frota Neto, J. Q., Walther, G., Bloemhof, J., Van Nunen, J. A. E. E., & Spengler, T. (2009). From closed-lo op to sustainable supply chains: The WEEE case. International Journal of Production Research, 48(15), 4463-4481. http://dx.doi.org/10.1080/00207540902906151.
Geyer, R., & Jackson, T. (2004). Supply loops and their constraints: the industrial ecology of recycling and reuse. California Management Review, 46(2), 55-73. http://dx.doi.org/10.2307/41166210.
Ghodsypour, S. H., & O’Brien, C. (1998). A decision support system for supplier selection using an integrated analytic hierarchy process and linear programming. International Journal of Production Economics, 56-57, 199-212. http://dx.doi.org/10.1016/S0925-5273(97)00009-1.
Guan, Z., Jin, Z., & Zou, B. (2007). A multi-objective mixed-integer stochastic programming model for the vendor selection problem under multi-product purchases. Information and Management Sciences, 18(3), 241-252.
Handfield, R., Walton, S., Sroufe, R., & Melnyk, S. (2002). Applying environmental criteria to supplier assessment: a study in the application of the analytical hierarchy process. European Journal of Operational Research, 141(1), 70-87. http://dx.doi.org/10.1016/S0377-2217(01)00261-2.
Heskett, J. L. (1976). Marketing. New York: Macmillan Publishing Co.
Hsu, C.-W., & Hu, A. H. (2009). Applying hazardous substance management to supplier selection using analytic network process. Journal of Cleaner Production, 17(2), 255-264. http://dx.doi.org/10.1016/j.jclepro.2008.05.004.
Lee, H. L. (1998). Postponement for mass customization: satisfying customer demands for tailor-made products. In J. Gattorna (Ed.), Strategic Supply Chain Alignment. Surrey: Gower.
Lee, H. I., Kang, H. Y., Hsu, C. F., & Hung, H. C. (2009). A green supplier selection model for high-tech industry. Expert Systems with Applications, 36(4), 7917-7927. http://dx.doi.org/10.1016/j.eswa.2008.11.052.
Lee, H. L., & Tang, C. S. (1998). Variability reduction through operations reversal. Management Science, 44(2), 162-172.
Matos, S., & Hall, J. (2007). Integrating sustainable development in the supply chain: the case of life cycle assessment in oil and gas and agricultural biotechnology. Journal of Operations Management, 25(6), 1083-1102. http://dx.doi.org/10.1016/j.jom.2007.01.013.
Mukherjee, K. (2014a). Analytic hierarchy process and technique for order preference by similarity to ideal solution: a bibliometric analysis ‘from’ past, present and future of AHP and TOPSIS. International Journal of Intelligent Engineering Informatics, 2(2/3), 96-117. http://dx.doi.org/10.1504/IJIEI.2014.066210.
Mukherjee, K. (2014b). Supplier selection criteria and methods: past, present and future. International Journal of Operational Research. In press.
Mukherjee, K., Sarkar, B., & Bhattacharya, A. (2011). Comments on the erratum to “Supply planning model for remanufacturing system in reverse logistics environment” Computers & Industrial Engineering, 61(4), 1349-1350. http://dx.doi.org/10.1016/j.cie.2011.06.013.
Muralidharan, C., Anantharaman, N., & Deshmukh, S. G. (2002). A multi-criteria group decision making model for supplier rating. The Journal of Supply Chain Management, 38(3), 22-33. http://dx.doi.org/10.1111/j.1745-493X.2002.tb00140.x.
Nidumolu, R., Prahalad, C.K., & Rangaswami, M.R. (2009). Why sustainability is now the key driver of innovation? Harvard Business Review,.
Noci, G. (1997). Design “green” vendor rating systems for the assessment of a supplier’s environmental performance. European Journal of Purchasing & Supply Management, 3(2), 103-114. http://dx.doi.org/10.1016/S0969-7012(96)00021-4.
Sanchez, P. P., & Soyer, R. (1998). Information concepts and pairwise comparison matrices. Information Processing Letters, 68(4), 185-188. http://dx.doi.org/10.1016/S0020-0190(98)00161-6.
Schwarz, J., Beloff, B., & Beave, E. (2002). Use sustainability metrics to guide decision-making. CEP Magazine, July, 58-63. Retrieved in 01 January, 2015, from www.cepmagazine.org
Shin, H., Collier, D. A., & Wilson, D. D. (2000). Supply management orientation and supplier buyer performance. Journal of Operations Management, 18(3), 317-333. http://dx.doi.org/10.1016/S0272-6963(99)00031-5.
Smith, K. G., Carroll, S. J., & Ashford, S. J. (1995). Intra-and inter-organizational cooperation: toward a research agenda. Academy of Management Journal, 38(1), 7-23. http://dx.doi.org/10.2307/256726.
Spekman, R. E. (1988). Perceptions of strategic vulnerability among industrial buyers and its effect on information search and supplier evaluation. Journal of Business Research, 17(4), 313-326. http://dx.doi.org/10.1016/0148-2963(88)90042-2.
Szmidt, E., & Kacprzyk, J. (2000). Distance between intuitionistic fuzzy sets. Fuzzy Sets and Systems, 114(3), 505-518. http://dx.doi.org/10.1016/S0165-0114(98)00244-9.
Tracey, M., & Tan, C. L. (2001). Empirical analysis of supplier selection and involvement, customer satisfaction and firm performance. Supply Chain Management: An International Journal, 6(4), 174-188. http://dx.doi.org/10.1108/EUM0000000005709.
Twede, D., Clarke, R. H., & Tait, J. A. (2000). Packaging postponement: a global packaging
strategy. Packaging Technology and Science, 13(3), 105-115.
Van Hoek, R. I. (1999). From reversed logistics to green supply chains. Supply Chain Management, 4(3), 129-134. http://dx.doi.org/10.1108/13598549910279576.
Van Mieghem, J. A., & Dada, M. (1999). Price versus production postponement: capacity and competition. Management Science, 45(12), 1631-1649.
Wu, C. H., Kuo, T. C., & Lu, Y. Y. (2007). Environmental principles applicable to green supplier evaluation by using multi-objective decision analysis. International Journal of Production Research, 45(18-19), 4317-4331. http://dx.doi.org/10.1080/00207540701472694.
Amindoust, A., Ahmed, S., Saghafinia, A., & Bahreininejad, A. (2012). Sustainable Supplier Selection: a ranking model based on fuzzy inference system. Applied Soft Computing, 12(6), 1668-1671. http://dx.doi.org/10.1016/j.asoc.2012.01.023.
Bai, C., & Sarkis, J. (2010). Green supplier development: analytical evaluation using rough set theory. Journal of Cleaner Production, 18(12), 1200-1210. http://dx.doi.org/10.1016/j.jclepro.2010.01.016.
Bowersox, D. J., & Closs, D. J. (1996). Logistical management, the integrated supply chain process. New York: Macmillan Publishing Company.
Brown, A. O., Lee, H. L., & Petrakian, R. (2000). Xilinx improves its semiconductor supply
chain using product and process postponement. Interfaces, 30(4), 65-80.
Chen, T. Y. (2011). A comparative analysis of score functions for multiple criteria decision making in intuitionistic fuzzy settings. Information Sciences, 181(17), 3652-3676. http://dx.doi.org/10.1016/j.ins.2011.04.030.
Cheng, T. C. E., & Podolsky, S. (1996). Just-in-time manufacturing: an introduction. 2nd ed. London: Chapman and Hall.
Chiou, J. S., Wu, L. Y., & Hsu, J. C. (2002). The adoption of form postponement strategy in a global logistics system: the case of Taiwanese information technology industry. Journal of
Business Logistics, 23, 107-124.
Christopher, M. (2000). The agile supply chain: competing in volatile markets. Industrial Marketing Management, 29(1), 37-44.
Department of Energy and Climate Change. (2009). Guidelines to Defra/DECC’s GHG conversion factors for company reporting: methodology paper for emission factors. London: DECC.
Ernst, R., & Kamrad, B. (2000). Evaluation of supply chain structures through modularization
and postponement. European Journal of Operational Research, 124, 495-510.
Freight Operations Information System. (2012). Retrieved in 01 January, 2015, from https://www.fois.indianrail.gov.in/FoisWebsite/html/Freight_Rates.htm
Frota Neto, J. Q., Walther, G., Bloemhof, J., Van Nunen, J. A. E. E., & Spengler, T. (2009). From closed-lo op to sustainable supply chains: The WEEE case. International Journal of Production Research, 48(15), 4463-4481. http://dx.doi.org/10.1080/00207540902906151.
Geyer, R., & Jackson, T. (2004). Supply loops and their constraints: the industrial ecology of recycling and reuse. California Management Review, 46(2), 55-73. http://dx.doi.org/10.2307/41166210.
Ghodsypour, S. H., & O’Brien, C. (1998). A decision support system for supplier selection using an integrated analytic hierarchy process and linear programming. International Journal of Production Economics, 56-57, 199-212. http://dx.doi.org/10.1016/S0925-5273(97)00009-1.
Guan, Z., Jin, Z., & Zou, B. (2007). A multi-objective mixed-integer stochastic programming model for the vendor selection problem under multi-product purchases. Information and Management Sciences, 18(3), 241-252.
Handfield, R., Walton, S., Sroufe, R., & Melnyk, S. (2002). Applying environmental criteria to supplier assessment: a study in the application of the analytical hierarchy process. European Journal of Operational Research, 141(1), 70-87. http://dx.doi.org/10.1016/S0377-2217(01)00261-2.
Heskett, J. L. (1976). Marketing. New York: Macmillan Publishing Co.
Hsu, C.-W., & Hu, A. H. (2009). Applying hazardous substance management to supplier selection using analytic network process. Journal of Cleaner Production, 17(2), 255-264. http://dx.doi.org/10.1016/j.jclepro.2008.05.004.
Lee, H. L. (1998). Postponement for mass customization: satisfying customer demands for tailor-made products. In J. Gattorna (Ed.), Strategic Supply Chain Alignment. Surrey: Gower.
Lee, H. I., Kang, H. Y., Hsu, C. F., & Hung, H. C. (2009). A green supplier selection model for high-tech industry. Expert Systems with Applications, 36(4), 7917-7927. http://dx.doi.org/10.1016/j.eswa.2008.11.052.
Lee, H. L., & Tang, C. S. (1998). Variability reduction through operations reversal. Management Science, 44(2), 162-172.
Matos, S., & Hall, J. (2007). Integrating sustainable development in the supply chain: the case of life cycle assessment in oil and gas and agricultural biotechnology. Journal of Operations Management, 25(6), 1083-1102. http://dx.doi.org/10.1016/j.jom.2007.01.013.
Mukherjee, K. (2014a). Analytic hierarchy process and technique for order preference by similarity to ideal solution: a bibliometric analysis ‘from’ past, present and future of AHP and TOPSIS. International Journal of Intelligent Engineering Informatics, 2(2/3), 96-117. http://dx.doi.org/10.1504/IJIEI.2014.066210.
Mukherjee, K. (2014b). Supplier selection criteria and methods: past, present and future. International Journal of Operational Research. In press.
Mukherjee, K., Sarkar, B., & Bhattacharya, A. (2011). Comments on the erratum to “Supply planning model for remanufacturing system in reverse logistics environment” Computers & Industrial Engineering, 61(4), 1349-1350. http://dx.doi.org/10.1016/j.cie.2011.06.013.
Muralidharan, C., Anantharaman, N., & Deshmukh, S. G. (2002). A multi-criteria group decision making model for supplier rating. The Journal of Supply Chain Management, 38(3), 22-33. http://dx.doi.org/10.1111/j.1745-493X.2002.tb00140.x.
Nidumolu, R., Prahalad, C.K., & Rangaswami, M.R. (2009). Why sustainability is now the key driver of innovation? Harvard Business Review,.
Noci, G. (1997). Design “green” vendor rating systems for the assessment of a supplier’s environmental performance. European Journal of Purchasing & Supply Management, 3(2), 103-114. http://dx.doi.org/10.1016/S0969-7012(96)00021-4.
Sanchez, P. P., & Soyer, R. (1998). Information concepts and pairwise comparison matrices. Information Processing Letters, 68(4), 185-188. http://dx.doi.org/10.1016/S0020-0190(98)00161-6.
Schwarz, J., Beloff, B., & Beave, E. (2002). Use sustainability metrics to guide decision-making. CEP Magazine, July, 58-63. Retrieved in 01 January, 2015, from www.cepmagazine.org
Shin, H., Collier, D. A., & Wilson, D. D. (2000). Supply management orientation and supplier buyer performance. Journal of Operations Management, 18(3), 317-333. http://dx.doi.org/10.1016/S0272-6963(99)00031-5.
Smith, K. G., Carroll, S. J., & Ashford, S. J. (1995). Intra-and inter-organizational cooperation: toward a research agenda. Academy of Management Journal, 38(1), 7-23. http://dx.doi.org/10.2307/256726.
Spekman, R. E. (1988). Perceptions of strategic vulnerability among industrial buyers and its effect on information search and supplier evaluation. Journal of Business Research, 17(4), 313-326. http://dx.doi.org/10.1016/0148-2963(88)90042-2.
Szmidt, E., & Kacprzyk, J. (2000). Distance between intuitionistic fuzzy sets. Fuzzy Sets and Systems, 114(3), 505-518. http://dx.doi.org/10.1016/S0165-0114(98)00244-9.
Tracey, M., & Tan, C. L. (2001). Empirical analysis of supplier selection and involvement, customer satisfaction and firm performance. Supply Chain Management: An International Journal, 6(4), 174-188. http://dx.doi.org/10.1108/EUM0000000005709.
Twede, D., Clarke, R. H., & Tait, J. A. (2000). Packaging postponement: a global packaging
strategy. Packaging Technology and Science, 13(3), 105-115.
Van Hoek, R. I. (1999). From reversed logistics to green supply chains. Supply Chain Management, 4(3), 129-134. http://dx.doi.org/10.1108/13598549910279576.
Van Mieghem, J. A., & Dada, M. (1999). Price versus production postponement: capacity and competition. Management Science, 45(12), 1631-1649.
Wu, C. H., Kuo, T. C., & Lu, Y. Y. (2007). Environmental principles applicable to green supplier evaluation by using multi-objective decision analysis. International Journal of Production Research, 45(18-19), 4317-4331. http://dx.doi.org/10.1080/00207540701472694.
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