Application of Analytic Hierarchy Process and Heuristic Algorithm in Solving Vendor Selection Problem

Vendor selection problem is believed to be a Multi Criteria Decision Making (MCDM) problem which has been a growing research area since past few decades. Several effective techniques have already been proposed by researchers and practitioners to evaluate the suppliers/vendors. Among these Analytic Hierarchy Process (AHP) is assumed to be the mostly exploited method due to its strong ability of attaining near-best solution to the problem in hand. In present research a novel heuristic approach is adopted as an optimization technique to solve the abovementioned MCDM problem. The initial solution of the problem is achieved using AHP and thereafter the quality of the solution is improved using the proposed heuristic technique. In order to validate the proposed methodology the experimentation is carried out on real-life industrial data collected from an Indian construction firm. The simulation result is compared and shown to outperform the AHP result in terms of quality of the solution. Tanmoy Chakraborty, Tamal Ghosh, Pranab K Dan