This document discusses supplier selection using grey relational theory. It involves choosing suppliers based on multiple qualitative and quantitative criteria. Several methods are analyzed, including fuzzy logic, analytical hierarchical process, and multi-criteria decision making. An example is presented to illustrate grey relational analysis for selecting a brake system supplier based on attributes like cost, quality, and delivery time. The results show grey relational theory provides an effective way to evaluate suppliers that considers both subjective and objective factors.

2. Presented by
A. H. M. Saifuddin 0711020
Md. Mizanur Rahman 0711021
Sk. Mohiuddin Al Faruq 0711022
Supervised By
A.M.M. Nazmul Ahsan
Lecturer, Dept. of
Industrial Engineering & Management(IEM),KUET.

3. Supplier selection is the process of
- choosing supplier for any supply chain
- optimizing different criteria of Supplier selection
- managing most critical activities of purchasing in
supply chain
- involving qualitative and quantitative multi-criteria
- consequently bringing out the most promising supplier
for the product.

4.  As global purchasing is becoming more risky.
 As the advancement of different technologies in
reducing time and cost such as Just In Time.
 Buyer supplier relation is no longer depends solely
on the price of the product rather than delivery time,
quality and flexibility.
 It helps assessing competitive market and allocates
best option.

5. Fuzzy logic approach
- measure supplier performance
- help Decision Making (DM) for appropriate
ordering
Multiple Attribute Utility Theory (MAUT)
- formulate viable sourcing strategies
- capable of handling multiple conflicting
attributes

6. Analytical Hierarchical Process (AHP)
- for prioritizing alternatives when multiple
criteria must be considered
- to structure complex problems in the form
of a hierarchy
Multi-criteria decision model
- for outsourcing contracts based on utility
function. The utility function includes the impacts on
cost, delivery time, and dependability.

7. Multi-Criteria Decision Making (MCDM)
- for quality evaluation and performance
appraisal
- criteria attributes are both qualitative as well
as quantitative
Grey relational Theory
- easily captures the dynamic characteristics of
different factors that in terms helps to save a lot
costs and time.

8.  Quick and saves a lot of money and time.
 It’s a dynamic process that in turns provides
opportunities for change in the number of attributes
easily.
 It can be easily transform into computer algorithm or
program that simply gives a quicker approach in
attaining solution.
 Emphasizes mostly on objective factors rather than
trust or dependency.

9.  Developed by Deng
 used to solve the uncertainty problems under the
discrete data and incomplete information
 especially for those problems with very unique
characteristic

10.  Gray Relational Equation
 Here i (j) is the jth value in ∆i difference data
series.
 is called distinguishing coefficient (=0.5).

11.  Data collected from Aftab Automobiles for the break
system of Automobiles.
 Several Attributes are chosen from different
suppliers.
 Cost and other attribute’s quantities against each
Supplier has been tabulated.

12. Table 1 : Attributes for hydraulic brake system of a vehicle

13. Table 2: Grey Relational Generation (Normalized, Reference Data Series)
Table 2: Grey Relational Generation (Normalized,
Reference Data Series)

14. Data Analysis
Table 3: Loss Estimates

15.  Gray Relational Equation
 Here i (j) is the jth value in ∆i difference data
series. is called distinguishing coefficient
(=0.5).

16. Data Analysis
Table 4: Grey Relational Coefficients and overall Grey
Relational Grade

17. Results

18. Results

19. In Recent times –
 Grey Relational Theory have found to be most
effective and promising in respect of time and cost.
 All the subjective and objective factors are equally
calculated for the entire set of suppliers.
 This paper has created future opportunities on
automation of supplier selection process.
 It was found to be dynamic process which responds
in a quickest possible way for any change.

20. Due to the advantages of Grey multiple attributes
decision, this paper proposes -
 For new supplier selection, it is very convenient to perform overall
measurement based on each company’s requirements.
 The company can choose its own appropriate goal for each
selection factor based on the characteristic demand of raw
materials
 Based on the preceding discussion, it is judged that the proposed
Grey multiple attributes decision method is very precise on the
whole. It can overcome the ambiguity arising from the measured
parameters of each attribute.