Application of interpretative structural modelling integrated multi criteria decision making methods for sustainable supplier selection

Abstract

Abstract Purpose The purpose of this paper is to report a study on the application of interpretative structural modelling (ISM) integrated with multi-criteria decision-making (MCDM) techniques for enabling the sustainability supplier selection. Design/methodology/approach In this paper, two approaches of hybrid MCDM methods are followed and the selection of sustainable supplier was based on the comparative results obtained from both the methods. The first hybrid approach is ISM – analytic network process (ANP) – ELimination and Et Choice Translating REality (ELECTRE II) and the second hybrid approach is ISM – ANP – Vlse Kriterijumska Optimizacija Kompromisno Resenje (VIKOR). ISM was used to identify the inter relationship between the criteria. Inter-relationship of criteria obtained from ISM will serve as an input for ANP. The weights obtained from ANP will be used in ELECTRE II and VIKOR. ELECTRE II is an outranking method, whereas VIKOR is a compromise ranking method; comparison of both the methods was carried out in this study. Findings In this study, two modules ISM–ANP – ELECTRE and ISM–ANP – VIKOR were compared for the problem of sustainable supplier selection. ELECTRE results with a single solution showed that Supplier 2 can be selected as the best supplier; VIKOR result shows that Supplier 1 and Supplier 2 can be selected as the best suppliers. Originality/value The selection of sustainable supplier considering the interrelationship of criteria using ISM and ranking the alternatives using compromise and outranking techniques was found to be original and novel contribution of the author.

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