Integration of Data Envelopment Analysis and Goal Programming in Supplier Selection Optimization

Abstract

Supplier selection is a common problem in manufacturing processes. However, like all fields of
the industries, every business still has to maintain good management and strategy in order to
increase the sales, maximize profits and considering the quality of raw materials. In this article, an
integration of data envelopment analysis and goal programming is chosen to resolve supplier
selection problem which deals with both qualitative and quantitative criteria. While the data
envelopment analysis measure the quality of each supplier using efficiency values, and goal
programming determines the best suppliers and the optimal order quantities among the
determined suppliers. The objective of mathematical models are maximizing total value of
purchase (TVP), minimizing total cost of purchase (TCP), and maximizing TVP and TCP
synchronously under some constraints such as quantity discount and capacity. Finally, this
research will determine the best supplier and optimum order quantity considering both qualitative
and quantitative criteria.