An Integrated Fuzzy Approach for Strategic Alliance Partner Selection in Third-Party Logistics

Abstract

Outsourcing some of the logistic activities is a useful strategy for companies in recent years. This makes it possible for firms to concentrate on their main issues and processes and presents facility to improve logistics performance, to reduce costs, and to improve quality. Therefore provider selection and evaluation in third-party logistics become important activities for companies. Making a strategic decision like this is significantly hard and crucial. In this study we proposed a fuzzy multicriteria decision making (MCDM) approach to effectively select the most appropriate provider. First we identify the provider selection criteria and build the hierarchical structure of decision model. After building the hierarchical structure we determined the selection criteria weights by using fuzzy analytical hierarchy process (AHP) technique. Then we applied fuzzy technique for order preference by similarity to ideal solution (TOPSIS) to obtain final rankings for providers. And finally an illustrative example is also given to demonstrate the effectiveness of the proposed model.