An Effective Powerful Test for Supplier Selection Evaluation with Multiple Characteristics

Abstract

Abstract Supplier selection in high-tech manufacturing industries has become more essential and has received considerable attention. In this paper, we consider a supplier selection problem with multiple characteristics in which we compare two-sided processes with multiple characteristics and select the better one with the higher capability. We first review an approach referred to as the division method. We then develop a new approach called the subtraction method. We compare the two methods in terms of their selection power. The results show that the proposed subtraction method is indeed more powerful than the division method. Two supplier-selection procedures are developed for practical applications. For practitioners’ convenience in applying our procedures, the various sample sizes required for designated selection powers are tabulated and discussed. For illustration purposes, a case is considered and solved for supplier selection evaluation.