To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Supplement S7 Supplier Selection.

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To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Supplement S7 Supplier Selection

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Analytical Hierarchy Process 1.Establish preferences for each alternative for each criteria 2.Assign importance scores to each criteria 3.Preferences and importance scores are combined for final selection Ranks decision alternatives and selects the best one Ranks decision alternatives and selects the best one Allows consideration of multiple criteria Allows consideration of multiple criteria

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Supplier Selection Example Suppliers:A, B, and C Criteria:product cost, product quality, service, and delivery NUMERICAL PREFERENCE LEVELVALUE Equally preferred1 Equally to moderately preferred2 Moderately preferred3 Moderately to strongly preferred4 Strongly preferred5 Strongly to very strongly preferred6 Very strongly preferred7 Very strongly to extremely preferred8 Extremely preferred9 Table S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Southcorp Company COSTQUALITYSERVICEDELIVERY ABC A132 B1/311/5 C1/251 ABC A161/3 B1/611/9 C391 ABC A11/31 B317 C11/71 ABC A11/31/2 B314 C21/41 Pairwise comparison Example S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Southcorp Company COSTQUALITYSERVICEDELIVERY ABC A132 B1/311/5 C1/251 ABC A161/3 B1/611/9 C391 ABC A11/31 B317 C11/71 ABC A11/31/2 B314 C21/41 Pairwise comparison COST SUPPLIERABC A132 B1/311/5 C1/251 11/6916/5 Example S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Southcorp Company COSTQUALITYSERVICEDELIVERY ABC A132 B1/311/5 C1/251 ABC A161/3 B1/611/9 C391 ABC A11/31 B317 C11/71 ABC A11/31/2 B314 C21/41 Pairwise comparison COST SUPPLIERABC A6/113/95/8 B2/111/91/16 C3/115/95/16 Example S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Southcorp Company COSTQUALITYSERVICEDELIVERY ABC A132 B1/311/5 C1/251 ABC A161/3 B1/611/9 C391 ABC A11/31 B317 C11/71 ABC A11/31/2 B314 C21/41 Pairwise comparison COST Row COST Row SUPPLIERABCAverage A B C Example S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Southcorp Company Summarized preferences CRITERIA SUPPLIERCostQualityServiceDelivery A B C Pairwise ranking of importance CRITERIACOSTQUALITYSERVICEDELIVERY Cost11/534 Quality5197 Service1/31/912 Delivery1/41/71/21 Example S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Southcorp Company Summarized preferences ROW CRITERIACOSTQUALITYSERVICEDELIVERYAVERAGES Cost Quality Service Delivery CRITERIA Cost Quality Service Delivery Preference vector Example S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Southcorp Company Overall score CRITERIA Cost Quality Service Delivery CRITERIA CostQualityServiceDelivery A B C Supplier A score=0.1993(0.5012) (0.1819) (0.1790) (0.1561) = Supplier B score= Supplier C score= Select Supplier C Example S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. AHP with Excel Exhibit S7.1

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. AHP with Excel Exhibit S7.2

To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. AHP with Excel Exhibit S7.3