Building a Proposed Model for Suppliers' Selection Using Multi-Criteria Approach

This study aimed to build a proposed model for suppliers' selection using Multi-Criteria Decision Making Approach (MCDMA): The Analytic Hierarchy Process (AHP)" [4] [5] and to apply it in the public shareholding construction companies in Nashik, based on suppliers' competitive priorities "quality, cost, delivery, and flexibility". The study also aimed to evaluate the relative importance of suppliers selection core-criteria, "quality, cost, delivery, and flexibility" from the perspective of functional managers of the researched construction companies. To gather the necessary data a random sample of (50) functional managers have been selected to fill the comparison forms, After analyzing data and applying, the study revealed that which is the most important supplier’s selection criterion among all competitive priorities, with a relative index value , cost importance of suppliers' selection, delivery and flexibility respectively. The study revealed also that the use of AHP for suppliers' selection process is highly recommended in the construction manufacturing sector in particular, and other manufacturing sectors. Due to the advantages of this approach in solving complex multi-criteria problems. Many items, these three performance areas would be enough, however for critical items needing an in- depth analysis of the supplier’s capabilities, a more detailed supplier evaluation study is required. In this activity material and their procurement is important parameter. About 60-70% cost engaged in construction are for material itself. Material procurement is prior important step of purchase action. Wider range of supply activity included in procurement process as compared to purchasing action. Vendor is important aspect in procurement process. In this highly competitive environment, ‘Supplier’ is one of the most important components of a supply chain. At present most of the construction companies are randomly selecting suppliers for the purchase of materials. It also lacks on part of considering the relative importance of criteria while making a selection of the best supplier. This study is a supplier evaluation approach through the Analytic Hierarchy Process. Such approach may support supplier selection in the most scientific manner which considers the relative importance of various criteria for decision making. The primary criteria are cost/price, quality and delivery, which are generally the most obvious and most critical areas that affect the buyer. For many items, these three performance areas would be enough, however for critical items needing an in-depth analysis of the supplier’s capabilities, a more detailed supplier evaluation study is required Supplier Evaluation and Management is a very strong concept in manufacturing industry, but has to come a long way in the construction Projects.