Selecting the best responsive option to unexpected orders at the time of capacity-shortage using multi criteria decision models

Article history: Received October 15, 2012 Accepted January 24, 2014 Available online March 4 2014 The way orders are accepted or rejected is the most important factor in customer satisfaction and success of make-to-order systems. The incoming orders to such organizations have certain delivery date in which the customer expects the order to be fulfilled and delivered. In some cases, unexpectedly increased orders exceed the existing capacity for on time fulfillment. In addition to rejection of order, as a typical choice, other options like outsourcing and capacity expansion are available to compensate for capacity shortage and deliver incoming orders according to schedule. However, each of the proposed options is superior in one or more criteria and so selecting the best one is not simply possible. The main goal of this study is to provide managers with a comprehensive, systematic, and applicable approach to evaluate and select the best of the existing options. For this purpose, a model comprised of some multicriteria techniques is delivered. Our proposed model is a blend of FAHP and FTOPSIS methods. In this model, FAHP is first used to determine the weight of criteria and then FuzzyTOPSIS (FTOPSIS) is employed to rank the options. Finally, the proposed model is applied on an actual case to assess and examine its efficiency. © 2014 Growing Science Ltd. All rights reserved.

[1]  Min Wu,et al.  Topsis-AHP simulation model and its application to supply chain management , 2006 .

[2]  R. Lin,et al.  An integrated FANP–MOLP for supplier evaluation and order allocation , 2009 .

[3]  P. Rogers,et al.  Judicious order acceptance and order release in make-to-order manufacturing systems , 2007 .

[4]  Cengiz Kahraman,et al.  Prioritization of human capital measurement indicators using fuzzy AHP , 2007, Expert Syst. Appl..

[5]  D. R. Hoffman,et al.  Personnel evaluation with AHP , 1998 .

[6]  Donatella Corti,et al.  Due date (DD) quotation and capacity planning inmake-to-order companies: results from an empirical analysis , 2008 .

[7]  Whm Henk Zijm,et al.  Order acceptance strategies in a production-to-order environment with setup times and due-dates , 1992 .

[8]  Gary M. Kern,et al.  A conceptual model for demand management in the assemble-to-order environment , 1990 .

[9]  Mahmood Ebadian,et al.  A new decision making structure for managing arriving orders in MTO environments , 2012, Expert Syst. Appl..

[10]  Masood A. Badri,et al.  A combined AHP}GP model for qualitycontrol sy stems , 2001 .

[11]  T Driouchi,et al.  Capacity planning under uncertainty: an Asian option approach , 2006 .

[12]  Wen-Chin Chou,et al.  A hybrid fuzzy MCDM approach for evaluating website quality of professional accounting firms , 2012, Expert Syst. Appl..

[13]  Yueh-Hsiang Chen,et al.  Applying fuzzy linguistic preference relations to the improvement of consistency of fuzzy AHP , 2008, Inf. Sci..

[14]  Robin O. Roundy,et al.  Capacity-driven acceptance of customer orders for a multi-stage batch manufacturing system: models and algorithms , 2005 .

[15]  David L. Olson,et al.  Management of multicriteria inventory classification , 1992 .

[16]  Peter Schuur,et al.  Order Acceptance with Reinforcement Learning , 2001 .

[17]  A. Hatami-Marbini,et al.  An Extension of the Electre I Method for Group Decision-Making Under a Fuzzy Environment , 2011 .

[18]  Ting-Yu Chen,et al.  The interval-valued fuzzy TOPSIS method and experimental analysis , 2008, Fuzzy Sets Syst..

[19]  Drakoulis Martakos,et al.  Customer evaluation for order acceptance using a novel class of fuzzy methods based on TOPSIS , 2009, Expert Syst. Appl..

[20]  Ming-Chyuan Lin,et al.  Using AHP and TOPSIS approaches in customer-driven product design process , 2008, Comput. Ind..

[21]  Alev Taskin Gumus,et al.  Evaluation of hazardous waste transportation firms by using a two step fuzzy-AHP and TOPSIS methodology , 2009, Expert Syst. Appl..

[22]  M. Snoek,et al.  Neuro-genetic order acceptance in a job shop setting , 2000 .

[23]  P. C. Schuur,et al.  Reinforcement learning versus heuristics for order acceptance on a single resource , 2007, J. Heuristics.

[24]  Eric W. T. Ngai,et al.  Evaluation of knowledge management tools using AHP , 2005, Expert Syst. Appl..

[25]  Seyed Hassan Ghodsypour,et al.  A decision support system for supplier selection using an integrated analytic hierarchy process and linear programming , 1998 .

[26]  Heinrich Kuhn,et al.  MARKOV DECISION MODELS FOR ORDER ACCEPTANCE / REJECTION PROBLEMS , 2005 .

[27]  Serhat Burmaoglu,et al.  A fuzzy hybrid MCDM approach for professional selection , 2012, Expert Syst. Appl..

[28]  Wen-Chin Chen,et al.  A fuzzy AHP and BSC approach for evaluating performance of IT department in the manufacturing industry in Taiwan , 2008, Expert Syst. Appl..

[29]  Huan-Jyh Shyur,et al.  COTS evaluation using modified TOPSIS and ANP , 2006, Appl. Math. Comput..

[30]  Lazim Abdullah.  Ranking of the Factors Associated with Road Accidents using Correlation Analysis and Fuzzy TOPSIS , 2010 .

[31]  R. Ramanathan,et al.  Using AHP for resource allocation problems , 1995 .

[32]  Selin Soner Kara,et al.  Long term supplier selection using a combined fuzzy MCDM approach: A case study for a telecommunication company , 2009, Expert Syst. Appl..

[33]  Chia-Chi Sun,et al.  A performance evaluation model by integrating fuzzy AHP and fuzzy TOPSIS methods , 2010, Expert Syst. Appl..

[34]  Heinrich Kuhn,et al.  Revenue management for a make-to-order company with limited inventory capacity , 2007, OR Spectr..

[35]  Raul Poler,et al.  Models for production planning under uncertainty: A review ☆ , 2006 .

[36]  Orlando Durán,et al.  Computer-aided machine-tool selection based on a Fuzzy-AHP approach , 2008, Expert Syst. Appl..

[37]  Cengiz Kahraman,et al.  Multi-attribute comparison of catering service companies using fuzzy AHP: The case of Turkey , 2004 .

[38]  V. Ivanescu,et al.  Order acceptance under uncertainty in batch process industries , 2004 .

[39]  S. Y. Chen,et al.  A multiple criteria decision-making model for justifying the acceptance of rush orders , 1997 .

[40]  Pin-Chang Chen,et al.  A Fuzzy Multiple Criteria Decision Making Model in Employee Recruitment , 2009 .

[41]  Siba Sankar Mahapatra,et al.  A fuzzy multi-criteria decision making approach for supplier selection in supply chain management , 2009 .

[42]  Ching-Lai Hwang,et al.  Fuzzy Multiple Attribute Decision Making - Methods and Applications , 1992, Lecture Notes in Economics and Mathematical Systems.

[43]  Juan Manuel Campos Benítez,et al.  Using fuzzy number for measuring quality of service in the hotel industry , 2007 .

[44]  Chin-Tsai Lin,et al.  Optimal marketing strategy: A decision-making with ANP and TOPSIS , 2010 .

[45]  C. Hwang.  Multiple Objective Decision Making - Methods and Applications: A State-of-the-Art Survey , 1979 .

[46]  Amitava Nandi,et al.  Behavior of an order release mechanism in a make-to-order manufacturing system with selected order acceptance , 2003, Proceedings of the 2003 Winter Simulation Conference, 2003..

[47]  Mustafa S. Canbolat,et al.  Fuzzy AHP-based supplier selection in e-procurement , 2007 .

[48]  Mohammad Ataei,et al.  Sawability ranking of carbonate rock using fuzzy analytical hierarchy process and TOPSIS approaches , 2011 .

[49]  Martin Rogers,et al.  A new system for weighting environmental criteria for use within ELECTRE III , 1998, Eur. J. Oper. Res..

[50]  Erwin W. Hans,et al.  Workload based order acceptance in job shop environments , 2005, OR Spectr..

[51]  Richard Bellman,et al.  Decision-making in fuzzy environment , 2012 .

[52]  Mohamed Marzouk,et al.  ELECTRE III Model for Value Engineering Applications. , 2011 .

[53]  Dušan Teodorović.  Multicriteria ranking of air shuttle alternatives , 1985 .

[54]  Walter O. Rom,et al.  Order acceptance using genetic algorithms , 2009, Comput. Oper. Res..

[55]  Herbert F. Lewis,et al.  Multi-period job selection: planning work loads to maximize profit , 2002, Comput. Oper. Res..

[56]  Kalevi Kyläheiko,et al.  An analytic approach to production capacity allocation and supply chain design , 2002 .

[57]  Chian-Son Yu,et al.  A GP-AHP method for solving group decision-making fuzzy AHP problems , 2002, Comput. Oper. Res..

[58]  Serkan Balli,et al.  Operating System Selection Using Fuzzy AHP and TOPSIS Methods , 2009 .

[59]  Morteza Pakdin Amiri,et al.  Project selection for oil-fields development by using the AHP and fuzzy TOPSIS methods , 2010, Expert Syst. Appl..

[60]  Sarah M. Ryan,et al.  Capacity expansion for a loss system with exponential demand growth , 2003, Comput. Oper. Res..

[61]  Deng Yong.  Plant location selection based on fuzzy TOPSIS , 2006 .

[62]  C. Kahraman,et al.  Multi‐criteria supplier selection using fuzzy AHP , 2003 .

[63]  Serkan Yavuz,et al.  Weapon selection using the AHP and TOPSIS methods under fuzzy environment , 2009, Expert Syst. Appl..

[64]  Nagraj Balakrishnan,et al.  Rationing Capacity Between Two Product Classes , 1996 .

[65]  Ernest H. Forman,et al.  Decision By Objectives: How To Convince Others That You Are Right , 2001 .

[66]  Dong-Hyun Jee,et al.  A method for optimal material selection aided with decision making theory , 2000 .

[67]  Semih Onüt,et al.  Transshipment site selection using the AHP and TOPSIS approaches under fuzzy environment. , 2008, Waste management.

[68]  Masoud Rabbani,et al.  A comprehensive decision-making structure for acceptance/rejection of incoming orders in make-to-order environments , 2008 .

[69]  Thomas E. Morton,et al.  Selecting jobs for a heavily loaded shop with lateness penalties , 1996, Comput. Oper. Res..

[70]  Luis C. Dias,et al.  An aggregation/disaggregation approach to obtain robust conclusions with ELECTRE TRI , 2002, Eur. J. Oper. Res..

[71]  Jian Yang,et al.  Inventory control with Markovian capacity and the option of order rejection , 2006, Eur. J. Oper. Res..

[72]  Ernesto Martinez,et al.  Learning and adaptation of a policy for dynamic order acceptance in make-to-order manufacturing , 2010, Comput. Ind. Eng..

[73]  Susan A. Slotnick,et al.  Order acceptance with weighted tardiness , 2007, Comput. Oper. Res..

[74]  Emin Gundogar,et al.  A Fuzzy Topsis Approach For Logistics Center Location Selection , 2011 .

[75]  Jun Wang,et al.  Multicriteria order acceptance decision support in over-demanded job shops: A neural network approach , 1994 .

[76]  Bin Zhang,et al.  Multi-product newsboy problem with limited capacity and outsourcing , 2010, Eur. J. Oper. Res..

[77]  Mao-Jiun J. Wang,et al.  Personnel selection using fuzzy MCDM algorithm , 1994 .

[78]  Ching-Lai Hwang,et al.  Multiple Attribute Decision Making: Methods and Applications - A State-of-the-Art Survey , 1981, Lecture Notes in Economics and Mathematical Systems.

[79]  Masoud Rabbani,et al.  A decision support system for order acceptance/rejection in hybrid MTS/MTO production systems , 2011 .

[80]  I-Shuo Chen,et al.  Using a novel conjunctive MCDM approach based on DEMATEL, fuzzy ANP, and TOPSIS as an innovation support system for Taiwanese higher education , 2010, Expert Syst. Appl..

[81]  Saadettin Erhan Kesen,et al.  New product design using FDMS and FANP under fuzzy environment , 2011, Appl. Soft Comput..

[82]  Rainer Kolisch.  Integrated Production Planning, Order Acceptance, and Due Date Setting for Make-to-Order Manufacturing , 1998 .

[83]  Fausto Cavallaro,et al.  A comparative assessment of thin-film photovoltaic production processes using the ELECTRE III method , 2010 .