How the solution changes according to different values

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Reference no: EM131316317

Alphen is an Austrian company producing yoghurt. In order to produce a new product for coeliacs, the company has to select a supplier of goat milk (which does not contain gluten). The company has decided to consider two selection criteria: the price and the reliability of the potential supplier.

After a brief market analysis, the candidates have been identified and ratings for each of the two criteria have been computed (see Table).

The supplier selection has been conducted by using two different methods, which are variants of the weighted scoring method: the absolute scoring method (ASM) and the relative scoring method (RSM). In ASM, the score of a supplier is given by considering the judgement value expressed on each criterion independently from the values given for the same judgement to the other suppliers. In RSM, the judgement value on a criterion depends on the worst value assigned the other suppliers for the same criterion. The company has decided to give a 40% (α = 0.4) weight to the price criterion and a 60% (i.e. 1 - α) weight to the reliability.

Determine the supplier to be selected by using ASM and RSM. Discuss how the solution changes according to different values of the parameter α.

Table: Potential suppliers and absolute judgement on the two criteria adopted by Alphen
Supplier	Price	Reliability
1	4.0	1.8
2	5.0	1.5
3	5.5	1.2
4	3.8	1.9
5	5.2	1.6
6	4.8	1.7

Reference no: EM131316317

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