Demand relaxation in supplier selection processes

Vizzoto, Felipe; Caixeta Filho, José Vicente

doi:10.1590/0104-530X3826-17

Felipe Vizzoto

Escola Politécnica, Universidade de São Paulo – USP, Av. Professor Almeida Prado, Travessa 2, 128, CEP 05508-900, São Paulo, SP, Brasil, e-mail: felipe.vizzoto@gmail.com

https://orcid.org/0000-0002-9161-8054

José Vicente Caixeta Filho

Escola Superior de Agricultura “Luiz de Queioz” – ESALQ, Universidade de São Paulo – USP, Av. Pádua Dias, 11, CEP 13418-900, Piracicaba, SP, Brasil, e-mail: jose.caixeta@usp.br

Figures (5)
Tables (2)

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Figure 1
Vendor selection approach with demand relaxation and its application requirements. Where: I = Products from i ... n; J = Purpose niches from j ... m; K = Suppliers from k ... o; L = Proposals l and p; CF_ik = Supply capacity of product i by supplier k; C_ik = Cost of product i by supplier k; C_ijk = Cost of product i, in niche j, by supplier k; C_ijkl = Cost of product i, in niche j, by supplier k, in proposal l; DE_ik = Utility of product i, by supplier k; DE_ijk = Utility of product i, in niche j, by supplier k; D_i = Demand for product i; D_j = Aggregate demand in niche j; Máx_ij = Maximum usage of product i in niche j; Mín_ij = Minimum usage of product i in niche j; PP_ik = Portfolio proposal of product i by supplier k; Fmín_k = Minimum order to supplier k; E_ijk = Package content of product i, in niche j, by supplier k; VE_ijk = Integer variable associated to product i, niche j and supplier k; BP_kl = Integer variable associated to supplier k and proposal l; P_ik = Volume acquired of product i from supplier k; P_ijk = Volume acquired of product i, for niche j, from supplier k; P_ijkl = Volume acquired of product i, for niche j, from supplier k, in the proposal l; Z = Total cost per utility acquired; A = Mastery of advanced decision analysis tools; B = Interdepartamental cooperation; C = Investment in human capital; D = Hierarchical Empowerment; E = Discernment for strategic alliances development;

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Figure 2
Classification and grouping of demand in purpose niches.

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Figure 3
Maximum and minimum usage of materials in their corresponding purpose niches.

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Figure 4
Comparative utility of the products in their niches.

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Figure 5
Cost, utility, inescapable acquisitions and expenditure concentration in traditional model, reduced approach and full approach.

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Table 1
Pros and cons of supplier selection methods.

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Table 2
Proposals parameters and operational limitations.

Methods	Advantages	Disadvantages
Single Objective Programming	Simplicity	Superficial analysis of other criteria
Single Objective Programming	Multifunctional	Trade-offs between criteria are hampered
MP + Total Cost of Ownership	Objective	Complex
MP + Total Cost of Ownership	Holistic treatment of costs	Requires extensive tracking and maintenance of cost data
MP + Multiattribute Utility Methods	Fits nicely to cases in which intangible factors are relevant to decision	Results are relative
MP + Multiattribute Utility Methods	Force trade-offs to be made by management	Depends on subjective assessments, difficult to prove its effectiveness
Multi Objective Programming	Results are not relative and preserve their dimensional units	Above two criteria, trade-off analysis becomes complicated
Multi Objective Programming	Non-dominated solutions allow decisions to be made, instead of pre-shaped optimum scenarios	Objective functions weighs are subjective

k	Fmín_k _(R$)	i	PP_ik ₍₁₀ ³ _units)	CF_ik ₍₁₀ ³ _units)	j	E_ijk _{(hectares/unit)}	P_ijk1 _(R$/hectare)	P_ijk2 _(R$/hectare)
I	200,000.00	1	15.00	27.50	a	10	49.76	45.00
		2	52.00	80.00	b	5	24.73	22.25
		30	4.00	20.00	d	5	15.00	13.00
		25	2.00	10.00	o	5	8.02	7.22
		33	14.00	14.00	q	5	53.82	48.42
II	100,000.00	18	12.80	80.00	b	5	21.75	20.50
		3	1.00	1.00	c	20	6.75	5.75
		20	2.50	10.00	d	10	22.32	20.16
		6	9.00	9.00	f	5	42.88	36.75
		22	2.00	2.00	g	5	35.10	31.50
		22	2.00	2.00	h	5	35.10	31.50
		23	3.00	7.00	i	5	1.20	1.20
		12	10.00	10.00	l	5	25.00	20.50
		15	2.00	2.50	o	20	9.40	9.00
III	200,000.00	28	125.00	400.00	b	1	15.84	14.88
		29	0.40	4.00	c	5	13.00	12.00
		5	1.50	1.50	e	20	35.20	33.10
		31	9.00	9.00	f	5	33.60	27.00
		31	9.00	9.00	g	5	33.60	27.00
		8	2.00	2.00	h	5	56.44	51.00
		9	3.50	3.50	i	10	2.35	2.10
		37	2.00	5.00	r	5	42.00	40.25
IV	200,000.00	36	1.00	55.00	a	5	20.40	19.40
		19	1.00	2.00	c	10	15.00	14.00
		21	2.00	4.50	f	10	35.20	30.00
		7	10.00	10.00	g	5	21.25	19.50
		14	5.00	5.00	n	5	76.00	71.00
IX	50,000.00	35	3.00	5.00	b	20	26.75	25.50
		31	9.00	9.00	f	5	29.40	28.00
		31	9.00	9.00	g	5	29.40	28.00
		16	4.00	8.00	p	10	3.30	3.10
		26	16.00	24.00	p	5	5.60	5.50
		13	15.00	15.00	m	10	15.75	15.75
V	100,000.00	17	80.00	275.00	a	1	45.99	43.47
		10	10.00	10.00	j	5	19.80	17.10
		3	1.00	2.00	c	10	6.50	6.50
		26	8.00	12.00	p	10	6.75	6.30
VI	100,000.00	4	3.50	5.00	d	20	19.50	18.80
		11	4.00	4.00	k	10	20.00	18.00
		38	25.00	25.00	r	1	20.00	18.75
VII	50,000.00	2	20.00	20.00	b	10	21.88	21.40
		7	10.00	10.00	g	5	20.00	17.50
		32	4.00	4.00	i	5	2.10	2.10
		10	30.00	30.00	j	5	19.80	18.90
		11	10.00	10.00	k	10	19.60	19.00
		16	8.00	12.00	p	10	3.20	3.20
		38	10.00	25.00	r	1	21.25	19.75
		24	24.00	30.00	m	5	16.80	15.00
VIII	50,000.00	7	1.50	1.50	g	20	17.50	17.00
		31	3.00	3.00	f	5	26.60	24.00
		31	3.00	3.00	g	5	26.60	24.00
		10	30.00	30.00	j	5	19.80	18.00
		12	10.00	10.00	l	5	22.50	21.00
		11	10.00	10.00	k	10	19.40	17.70
		37	5.00	5.00	r	5	35.00	34.30
		24	24.00	30.00	m	5	15.00	15.00
X	200,000.00	27	5.75	13.75	a	20	36.30	32.00
		10	10.00	15.00	j	10	18.90	18.54
		26	24.00	24.00	p	5	5.70	5.40
XI	70,000.00	35	3.00	20.00	b	20	26.25	25.00
XI	70,000.00	34	2.80	10.00	q	5	81.15	67.50
XII	200,000.00	13	20.00	30.00	m	5	17.10	16.65
XII	200,000.00	24	10.00	30.00	m	5	15.00	14.40
XIII	30,000.00	31	9.00	9.00	f	5	28.50	26.60
		31	9.00	9.00	g	5	28.00	26.30
		7	10.00	10.00	g	5	20.00	17.50
		11	10.00	10.00	k	10	19.60	18.00
		16	4.00	4.00	p	10	3.00	2.80
		24	24.00	30.00	m	5	15.00	15.00

[1] Source: Elaborated by the authors.

Brasil

Brasil

Demand relaxation in supplier selection processes

Relaxamento de demanda em processos de seleção de fornecedores

Abstract