Multiple criteria inventory classification using fuzzy analytic hierarchy process

Abstract

A systematic approach to the inventory control and classification may have a significant influence on company competitiveness. In practice, all inventories cannot be controlled with equal attention. In order to efficiently control the inventory items and to determine the suitable ordering policies for them, multi-criteria inventory classification is used. In this paper, fuzzy analytic hierarchy process for multiple criteria ABC inventory classification has been proposed. Fuzzy Analytic Hierarchy process (Fuzzy AHP) is used to determine the relative weights of the attributes or criteria, and to classify inventories into different categories. To accredit the proposed model, it is implemented for the 351 raw materials of switch gear section of Energypac Engineering Limited (EEL), a large power engineering company of Bangladesh. In this approach, at first, related criteria have been selected (Unit price, last year consumption or annual demand, last use date, supplier, criticality, durability) and the weights of these criteria was determined using Fuzzy AHP. Then a score to each item was assigned for each criterion as triangular fuzzy number and the final normalized weighted score of each item using fuzzy set theory is calculate. Finally, Chang's extent analysis was used for the comparison of fuzzy numbers and the final scores are compared with each other. Then all items were classified into three classes according to their final score.

An integrated decision analytic framework of machine learning with multi-criteria decision making for multi-attribute inventory classification

“…Cebi and Kahraman (2012) proposed a single and two multiple attributes fuzzy models based on both FAHP and fuzzy TOPSIS for information under incomplete and vague conditions. Kabir and Hasin (2012) also proposed an FAHP-based classification. The study used fuzzy logic to determine relative criteria weights.…”

Implementing Fuzzy Logic and AHP into the EFQM model for performance improvement: A case study

“…Badizadeh and Khanmohammadi [40] developed a Fuzzy multi-criteria decision making model for assessment and selection of the best idea of new product development based on the criteria in a company associated with the automobile manufacturing industry in Iran. Kabir and Hasin [41] used a Fuzzy analytic hierarchy process for multiple criteria ABC inventory classification in a large power engineering company of Bangladesh. Javanbarg et al [42] presented a Fuzzy optimization model to solve Multi-Criteria Decision Making (MCDM) systems based on Fuzzy AHP using an improved Particle Swarm Optimization (PSO).…”

A multicriteria framework for inventory classification and control with application to intermittent demand

“…They demonstrated that AHP is more complete than the ABC approach because several dimensions are taken into account. Different forms of AHP approaches have been applied in MCIC by several authors (Partovi & Burton, 1993;Partovi & Hopton, 1994), including an AHP fuzzy version proposed by Cakir and Canbolat (2008) and Kabir and Hasin (2012), and AHP combined with the k-means clustering algorithm (Lolli, Ishizaka, & Gamberini, 2014). Ramanathan (2006) criticized AHP because it requires subjective pair-wise comparison of criteria that affects the results.…”