Multiobjective supplier selection using optimisation technique for balancing supply chain

This paper presents an innovative method to distribute sales volume among multiple suppliers in a multiobjective, multisource supplier selection scenario using optimisation techniques. The dynamics of assigning sales volume is captured in a mathematical model purported at satisfying multiple objectives. In such a multiobjective scenario, the theory of pareto optimality is introduced to formulate the process of optimal supplier selection. Linear Integer Programming method is proposed to solve the mathematical model for an optimal solution. The mathematical model is also retrofitted to solve for models with incremental discount pricing with the help of Non-Linear Programming techniques. The results illustrate the effectiveness and applicability of the technique under the discussed scenario. The results obtained using the linear integer programming method are also compared against a conventional process like Analytic Hierarchy Process and both the methods are appraised for their merits and demerits. © 2008, Inderscience Publishers.