Leonardo Leon Lopez

Email: Eliecerl.leonl@utadeo.edu.co

A REVIEW OF METHODS
A SUPPORTING SUPPLIER
SELECTION

Luitzen de Boer, Eva Labro, Pierangela Morlacchi

University of Twente, Faculty of Technology & Management, AE Enschede, Netherlands
"London School of Economics, Department of Accounting and Finance
University of Bath, Centre for Research in Strategic Purchasing and Supply,
Received 3 February 2000; received in revised form 8 September 2000; accepted 18 November 2000

KEY WORDS

Supplier, Logistics, Models, Costs, Envelopment, Selection.

MAIN IDEA
The main idea of the article is the way in which providers should be selected according to
a series of approaches to make the best decision.

SECOND IDEA
The article gives an idea of how suppliers have been selected in companies for a long
time, and from there, gives a set of parameters based on research and innovation to
reduce costs, time and labor when evaluating suppliers.

SUMMARY

Criteria for Evaluating Current Supplier Selection

* Cost
* Time
*Availability 
*Logistics

Jorge Tadeo Lozano University

English B1
 SUMMARY

Criteria for evaluating the selection of suppliers according to the parameters of

the article

Categorical methods
Categorical methods are qualitative models. On the basis of data and the buyer's
experience, current suppliers or family members will be able to evaluate
according to a set of criteria. Evaluations actually consist of categorizing the
supplier's performance on a criterion as either 'positive', and 'neutral' or 'negative'.
After a supplier has been rated on all criteria, the buyer gives an overall rating,
again by checking one of the three options. In this way, suppliers are classified into
three categories.
Data envelopment analysis
It is based on the "efficiency" concept of A Decision Alternative. The alternatives are
evaluated on "benefit" (output) and cost criteria (entry). The efficiency of an alternative
(for example, a vendor) is defined as the ratio of the weighted sum of its products (i.e. the
yield of the supplier) to the weighted sum of its inputs (i.e. the costs of use of the supplier).

Cluster Analysis (CA)

It is a basic method of statistics that uses a classification algorithm to group a series of
elements that are described by a set of numerical attribute scores into a series of groups
such that differences between elements within a group are minimal and differences
between elements in different groups are maximum.

Case Based Reasoning Systems (CBR)

CBR systems fall into the category of the so-called artificial intelligence (AI) approach.
Basically, a CBR system is a software-driven database that provides decision-makers with
useful information and experiences from similar previous decision situations.

Decision models for the final phase of the election

Linear weighting models

In linear weighting models, weightings are assigned to the criteria, the greater the weight,
the greater the importance.
 SUMMARY

Total cost of ownership (TCO) models

TCO-based models attempt to include all quantifiable costs in supplier choice
incurred throughout the life cycle of the purchased item.

Mathematical programming models

Given an adequate decision fit, PM allows the decision-maker to formulate the
decision problem in terms of a mathematical objective function that must
subsequently be maximized or minimized by varying the values of the variables in
the objective function.

PERSONAL VIEW

The methodology for the selection of suppliers proposed in the article is excellent,
because it offers a much more objective selection, taking into account several criteria that
are relevant, but are usually discarded, the implementation of the method and tools work
transversally to any selection process by the organization, has multiple procedures and
various ways of selecting the best provider, based on needs.