Vendor selection in a modified re-buy situation using a strategy-aligned fuzzy approach

The supplier/vendor selection is a decision-making problem at the strategic management level that involves a semi-structured process. The majority of the existing approaches obtained their optimal solutions without considering their fits with the strategy of the firm. This study utilizes the supplier positioning matrix, modified from the product-process change matrix, to link the capability of suppliers with the requirements of the customers to identify the strategy-aligned criteria for vendor selection in a modified re-buy situation. A fuzzy factor rating system is then used to evaluate the potential vendors based on the type of components required by the customers. In addition, in the proposed model, the final decision-maker is given the authority to synthesize the scores of individual alternatives based on the risks of individual vendors to accommodate the differences among the vendors to the specific environment. An empirical case study is performed to demonstrate the efficacy of the proposed system and to identify the best potential vendor(s) for further negotiation and development. The results of the case study also provide interesting managerial implications.