Integrating Fuzzy Delphi with Fuzzy Analytic Hierarchy Process for Multiple Criteria Inventory Classification
Golam Kabir1 and Razia Sultana Sumi2
1
PhD Student, Department of Civil Engineering, University of British Columbia, Kelowna, British Columbia, Canada. Email: gk.raju@yahoo.com (corresponding author). 2 Assistant Professor, Department of Business Administration, Stamford University, Bangladesh, Dhaka, Bangladesh. Email: sumi2681@yahoo.com
Production Management Received March 7, 2012; revisions April 3, 2012; April 6, 2012; accepted April 12, 2012 Available online June 25, 2012
_________________________________________________________________________________________
Abstract: A systematic approach to the inventory control and classification may have a significant influence on company competitiveness. In practice, all inventories cannot be controlled with equal attention. In order to efficiently control the inventory items and to determine the suitable ordering policies for them, multiple criteria inventory classification is used. In this paper, a systematic and logical approach is structured for multiple criteria inventory classification through integrating Fuzzy Delphi Method (FDM) with Fuzzy Analytic Hierarchy Process (FAHP). Fuzzy Delphi method used to identify the most important and significant criteria and, Fuzzy AHP is used to determine the relative weights of the attributes or criteria, and to classify inventories into different categories. To accredit the proposed model, it is implemented for the 351 raw materials of switch gear section of Energypac Engineering Limited (EEL), a large power engineering company of Bangladesh. Implementation results show that the proposed method can be used in inventory classification. Keywords: Multicriteria inventory classification, Fuzzy Delphi Method, fuzzy analytic hierarchy process, triangular fuzzy number.
References: Bhattacharya, A., Sarkar, B., and Mukherjee, S.K. (2007). Distance-based consensus method for ABC analysis. International Journal of Production Research, 45(15), 3405-3420. Boender, C.G.E., de Graan, J.G., and Lootsma, F.A. (1989). Multi-criteria decision analysis with fuzzy pairwise comparisons. Fuzzy Sets and Systems, 29(2), 133-143. Björnfot, A. and Torjussen, L. (2012). Extent and Effect of Horizontal Supply Chain Collaboration among Construction SME. Journal of Engineering, Project, and Production Management, 2(1), 47-55. Bozbura, F.T., Beskese, A., and Kahraman, C. (2007). Prioritization of human capital measurement indicators using fuzzy AHP. Expert Systems with Applications, 32(4), 1100-1112. Braglia, M., Grassi, A., and Montanari, R. (2004). Multiattribute classification method for spare parts inventory management. Journal of Quality in Maintenance Engineering, 10 (1), 55-65. Buckley, J.J. (1985). Fuzzy hierarchical analysis. Fuzzy Sets and Systems, 17(3), 233-247. Cakir, O. and Canbolat, M.S. (2008). A web-based decision support system for multi-criteria inventory classification using fuzzy AHP methodology. Expert Systems with Applications, 35( 3), 1367-1378. Cebi, F., Kahraman, C. and Bolat, B. (2010). A multiattribute ABC classification model using fuzzy AHP. Proceedings of the 40th International Conference on Computers and Industrial Engineering, Awaji, Japan, 25-28. Chang, D.Y. (1992). Extent analysis and synthetic decision. Optimization Techniques and Applications, 1, 352-355. Chang, D.Y. (1996). Applications of the extent analysis method on fuzzy AHP. European Journal of Operational Research, 95(3), 649-655. Chase, R.B., Jacobs, F. R., Aquilano, N.J., and Agarwal, N.K. (2006). Operations Management for Competitive Advantage. 11th Edition, McGraw Hill, New York, USA. Chen, Y., Li, K.W., Kilgour, D.M., and Hipel, K.W. (2008). A case-based distance model for multiple criteria ABC analysis. Computers & Operations Research, 35(3), 776-796. Chen, Y. and Qu, L. (2006). Evaluating the Selection of Logistics Centre Location Using Fuzzy MCDM Model Based on Entropy Weight. Proceedings of the 6th World Congress on Intelligent Control and Automation, Dalian, China. Chu, C.W., Liang, G.S., and Liao, C.T. (2008). Controlling inventory by combining ABC analysis and fuzzy classification. Computers and Industrial Engineering, 55(4), 841-851. Csutora, R. and Buckley, J.J. (2001). Fuzzy hierarchical analysis: The Lambda-Max Method. Fuzzy Sets and Systems, 120, 181-195. Journal of Engineering, Project, and Production Management, 2013, 3(1), 22-34 Integrating Fuzzy Delphi with Fuzzy Analytic Hierarchy Process for Multiple Criteria Inventory Classification 33 Flores, B.E. and Whybark, D.C. (1986). Multiple Criteria ABC Analysis. International Journal of Operations and Production Management, 6(3), 38-46. Flores, B.E. and Whybark, D.C. (1987). Implementing Multiple Criteria ABC Analysis. Journal of Operations Management, 7(1), 79-84. Flores, B.E., Olson, D.L., and Dorai, V.K. (1992). Management of Multicriteria Inventory Classification. Mathematical and Computer Modeling, 16(12), 71-82. Gumus, A.T. (2009). Evaluation of hazardous waste transportation firms by using a two step fuzzy-AHP and TOPSIS methodology. Expert Systems with Applications, 36(2), 4067-4074. Gupta, R., Sachdeva, A., and Bhardwaj, A. (2010). Selection of 3pl Service Provider using Integrated Fuzzy Delphi and Fuzzy TOPSIS. Proceedings of the World Congress on Engineering and Computer Science, II, San Francisco, USA. Guvenir, H.A. and Erel, E. (1998). Multicriteria inventory classification using a genetic algorithm. European Journal of Operational Research, 105(1), 29-37. Hadi-Vencheh, A. (2010). An improvement to multiple criteria ABC inventory classification. European Journal of Operational Research, 201(3), 962-965. Hadi-Vencheh, A. and Mohamadghasemi, A. (2011). A fuzzy AHP-DEA approach for multiple criteria ABC inventory classification. Expert Systems with Applications, 38(4), 3346-3352. Ishikawa, A., Amagasa, M., Shiga, T., Tomizawa, G., Tatsuta, R., and Mieno, H. (1993). The max-min Delphi method and fuzzy Delphi method via fuzzy integration. Fuzzy Sets and Systems, 55(3), 241-253. Jamshidi, H. and Jain, A. (2008). Multi-Criteria ABC Inventory Classification: With Exponential Smoothing Weights. Journal of Global Business Issues, Winter issue. Kabir, G. (2011). Fuzzy AHP for Contractor Evaluation in Project Management-A Case Study. International Journal of Business and Information Technology, 1(1), 85-96. Kabir, G. and Hasin, M.A.A. (2011). Evaluation of Customer Oriented Success Factors in Mobile Commerce Using Fuzzy AHP. Journal of Industrial Engineering and Management, 4(2), 361-386. Kutlu, A.C. and Ekmekçioglu, M. (2012). Fuzzy failure modes and effects analysis by using fuzzy TOPSISbased fuzzy AHP. Expert Systems with Applications, 39(1), 61-67. Lei, Q.S., Chen, J., and Zhou, Q. (2005). Multiple criteria inventory classification based on principal components analysis and neural network. Proceedings of Advances in neural networks, 1058-1063, Berlin. Liu, Q. and Huang, D. (2006). Classifying ABC Inventory with Multicriteria Using a Data Envelopment Analysis Approach. Proceedings of the Sixth International Conference on Intelligent Systems Design and Applications (ISDA '06), 1, 1185-1190, Jian, China. Meixner, O. (2009). Fuzzy AHP Group Decision Analysis and Its Application for the Evaluation of Energy Sources 2. Proceedings of the 10th International Symposium on the Analytic Hierarchy/Network Process Multi-criteria Decision Making, Pittsburgh, Pennsylvania, USA, 1-14. Mikhailov, L. (2003). Deriving priorities from fuzzy pairwise comparison judgements. Fuzzy Sets and Systems, 134(3), 365-385. Muller, M. (2003). Essentials of Inventory Management. American Management Association, New York, USA. Nahmias, S. (2004). Production and Operations Analysis. 5th Edition, Irwin/McGraw Hill, Burr Ridge, IL, USA, 213-215. Ng, W.L. (2007). A simple classifier for multiple criteria ABC analysis. European Journal of Operational Research, 177(1), 344-353. Noorderhaben, N. (1995). Strategic decision making. Addison-Wesley, UK. Partovi, F. Y. and Burton, J. (1993). Using the analytic hierarchy process for ABC analysis. International Journal of Production and Operations Management, 13(9), 29-44. Partovi, F.Y. and Anandarajan, M. (2002). Classifying inventory using and artificial neural network approach. Computers & Industrial Engineering, 41(4), 389-404. Ramanathan, R. (2006). ABC inventory classification with multiple-criteria using weighted linear optimization. Computers & Operations Research, 33(3), 695-700. Rao, R.V. (2007). Decision making in the manufacturing environment using graph theory and fuzzy multiple attribute decision making methods. Springer-Verlag, London. Rezaei, J. (2007). A Fuzzy Model for Multi-Criteria Inventory Classification. Analysis of Manufacturing Systems, 167-172. Saaty, T.L. (1980). The analytic hierarchy process. McGraw-Hill, New York, NY. Saaty, T.L. (1998). The Analytic Hierarchy Process: Planning, Priority Setting, Resource Allocation. RWS Publications, Pittsburgh. Simunovic, K., Simunovic, G. and Saric, T. (2009). Application of Artificial Neural Networks to Multiple Criteria Inventory Classification. Strojarstvo, 51(4), 313-321. Tang, Y.C. and Beynon, M.J. (2009). Group decisionmaking within capital investment: a Fuzzy Analytic Hierarchy Process approach with developments. International Journal of Operational Research, 4(1), 75-96. Wang, Y.M., Yang, J.B., and Xu, D.L. (2005). A twostage logarithmic goal programming method for generating weights from interval comparison matrices. Fuzzy Sets Systems, 152, 475-498. Xu, R. (2000). Fuzzy least square priority method in the analytic hierarchy process. Fuzzy Sets and Systems, 112(3), 395-404. Yu, M.C. (2011). Multi-criteria ABC analysis using artificial-intelligence-based classification techniques. Expert Systems with Applications, 38(4), 3416-3421. Zhou, P. and Fan, L. (2007). A note on multi-criteria ABC inventory classification using weighted linear optimization. European Journal of Operational Research, 182(3), 1488-1491. Journal of Engineering, Project, and Production Management, 2013, 3(1), 22-34 34 G. Kabir and R. S. Sumi Golam Kabir is a PhD student in the Civil Engineering Department of Faculty of Applied Science at The University of British Columbia (UBC), Kelowna, British Columbia, Canada. Mr. Kabir was an Assistant Professor in the Department of Industrial and Production Engineering (IPE) at Bangladesh University of Engineering and Technology (BUET). He received a B.Sc. and a M.Sc. in Industrial and Production Engineering from BUET in 2009 and 2011 respectively. His main scientific interest concentrates on multi criteria decision analysis under risk and uncertainty, fuzzy inference system and decision support system. He has a large number of international journal publications in his credit. Razia Sultana Sumi is an Assistant Professor in the Department of Business Administration at Stamford University Bangladesh. She received BBA and MBA in Marketing Department from Dhaka University, Bangladesh. Her research interests are marketing research, productivity improvement and decision science. Journal of Engineering, Project, and Production Management, 2013, 3(1), 22-34