Supplier selection and management system considering relationships in supply chain management

Abstract

This paper is aimed to suggest a methodology leading to effective supplier management processes utilizing information obtained from the supplier selection processes. For this methodology, we propose the supplier selection and management system (SSMS) that includes purchasing strategy system, supplier selection system, and supplier management system, and we explain how the SSMS is applied to a real supply chain. The methodology identifies the managerial criteria using information derived from supplier selection process and makes use of them in the supplier management process. These managerial criteria include key criteria that are major criteria required by the manufacturer for the best quality of parts from suppliers according to the character of each part, and weak criteria that show the shortcomings of selected suppliers as compared with alternative suppliers with regard to each criterion. The effectiveness of supplier management with managerial criteria was verified by a t-test and a correlation analysis with the example of a Korean air conditioner manufacturer.