International Journal of Procurement Management (39 papers in press)
Multi Item Two Warehouse Fuzzy Inventory Model
by Rahul Waliv, Hemant Umap
Abstract: In this paper multi-item fuzzy profit maximization inventory model with ramp type demand under imprecise space, budget constraints and imprecise holding cost with two storage facilities. There are two warehouses one is situated at market place called as own warehouse (OW) and another is little away from market place called as rented warehouse (RW). The sale is conducted from OW and the sold items are replaced continuously by the items at RW. Here shortages are not allowed. The fuzzy model has been solved by using fuzzy nonlinear programming technique and illustrated numerically.
Keywords: Ramp type demand; Deteriorating items; Linear membership function; fuzzy nonlinear programming technique;.
A CLUSTER FIRST-ROUTE SECOND APPROACH FOR A CAPACITATED VEHICLE ROUTING PROBLEM: A CASE STUDY
by Serap ERCAN COMERT, Harun R. YAZGAN, Sena KIR, Furkan YENER
Abstract: In this study, a capacitated vehicle routing problem (CVRP) which dealt with minimum distance routes for vehicles that serve customers having specific demands from a common warehouse under a capacity constraint. This problem is an NP hard. We solved the problem as a hierarchical way (i.e. cluster-first route-second method). Firstly, customers were clustered using three different clustering algorithms; K-means, K-medoids and Random clustering with considering a vehicle capacity. Secondly, routing problems for each cluster were solved using a branch and bound algorithm. The proposed solution strategy was employed on a case study in a supermarket chain. Results of numerical investigation were presented to illustrate effectiveness of the algorithms using paired sample t tests. The results illustrated that the K-medoids algorithm provided better solution than the others.
Keywords: Capacitated Vehicle Routing Problem; K-Means Clustering Algorithm; K-Medoids Clustering Algorithm; Random Clustering Algorithm; Branch and Bound Algorithm.
E-procurement and SME involvement in public procurement of innovations: An exploratory study
by Jani Saastamoinen, Timo Tammi, Helen Reijonen
Abstract: Current public procurement policies in the European Union (EU) seek to improve small and medium-sized enterprises (SMEs) access to public procurement, and emphasize public procurement of innovations (PPI) and aim to promote a switch to e-procurement. However, many information and communication related barriers impede SME access to public sector contracts, which could be mitigated by knowledge management (KM). While e-procurement is expected to increase the involvement of SMEs in public procurement, it is not well-understood how or which KM properties of an e-procurement service will best facilitate PPI. This paper presents an exploratory inquiry of how suppliers perceive the properties of an e-procurement platform, and how these properties are associated with their involvement in PPI. The results show that while information exchange properties were not estimated to be as important as other properties they are nevertheless more important in the sense of being positively associated with participating in PPI.
Keywords: Public procurement; public innovation procurement; electronic procurement; e-procurement; SMEs; innovations; knowledge management; suppliers; public sector; contracting authorities; information exchange;.
A Framework for Assessment of SSCM Strategies with respect to sustainability performance: An Indian Thermal Power Sector Perspective
by Jitendra Narayan Biswal, Kamalakanta Muduli, Suchismita Satapathy, Sushant Tripathy
Abstract: The explosion of the population in India has put a tremendous pressure to generate huge amount of energy, particularly electrical energy. Indeed, more than 50% of the total electrical energy produced in the country is generated by the coal based thermal power plants and is expected to be continued for another 2-3 decades.Growing concern over the environmental effects caused by the supply chain activities of the power industries that affects ecosystems and quality of life adversely as well natural resource depletion has been drawing attention of organizations to focus on sustainability practices.Realizing the importance of sustainable practices in traditional supply chain management, an effort has been made to develop a framework by using AHP-TOPSIS to study SSCM strategies. The findings of the research will facilitate the analysis and assessment of managerial approaches for SSCM in power generation facilities with its differing aspects rather than few limited aspects.
Keywords: Thermal power plants; Sustainable supply chain management; AHP-TOPSIS.
A game theory model for pricing and supplier selection in a closed-loop supply chain
by Maryam Esmaeili, Somayeh Najafi Ghobadi
Abstract: In this paper, pricing and supplier selection in a closed-loop supply chain (CLSC) are modeled by a game theory approach. The CLSC includes one manufacturer and multi-suppliers with variable defective parts. The manufacturer is responsible for collecting the used products where the number of defective parts purchased from the suppliers is random variable. The suppliers determine their standard deviation and the wholesale price. For the defective parts greater than the expected number, the manufacturer penalizes the suppliers. The manufacturer determines the optimal selling price, the price of collecting a used product, the number of appropriate suppliers, and the penalty cost by maximizing the profit. The end demand is affected by the selling price, and the competition between the suppliers is considered based on the Bertrand model. The interaction between the manufacturer and the suppliers is modeled by the static and dynamic games to obtain Nash and Stackelberg equilibria. In the dynamic game, the manufacturer is the leader and the suppliers are the followers. Finally, the numerical examples and sensitivity analysis with respect to the main parameters are presented to illustrate the theoretical results.
Keywords: Closed-loop supply chain; Supplier selection; Pricing; Game theory; Defective parts.
An Inventory Model for Deteriorating Items with Time Dependent Holding Cost and Shortages under Permissible Delay in Payment
by Nabendu Sen, Sumit Saha
Abstract: This study is motivated by the work of Khanra et al.[Applied Mathematical Mathematics and Computation 218(2011)1-9].We have revisited their model taking into account the following points; (i) The demand rate as a+bt+csin(t) ,(ii) Shortages are allowed, (iii) Delay in payment is permissible under three different cases, i.e. case I: The credit period is less than the time of occurrence of shortages, case II: The credit period is greater than the time of occurrence of shortages and case III: The credit period is greater than the cycle time. Under these aforesaid assumptions, an inventory model is developed and solved to obtain optimal solutions for inventory system with deteriorating items. An algorithm is proposed to solve the developed model. Finally, numerical examples are given in support of the developed model and sensitivity analysis is carried out with suitable example. Justification for extension of the existing model in literature with above mentioned demand function and linear time dependent holding cost is also discussed in this paper.
Keywords: Delay in payment; Inventory costs; Deterioration; Backlogged; Profit; Demand rate; Shortage changes slightly; significant changes; Fluctuations in rate of demand; Lead time.
The effect of product quality uncertainty on quality-screening efforts: does the purchase frequency and procurement channel choice matter?
by Renger Kanani, Arnt Buvik
Abstract: Product quality uncertainty is one of the major concerns for buyers in online transactions. In fact, research into the consequences and control of this uncertainty in online transactions has increased considerably in recent years. However, product quality uncertainty poses challenges not only to online buyers, but also to offline buyers. Therefore, the objectives of this empirical study were to examine the effect of product quality uncertainty on quality-screening efforts in offline transactions, and whether the frequency of purchase from the same source and the choice of procurement channel may be used as control mechanisms to reduce this effect. Empirical evidence from 239 small food-processing firms shows that product quality uncertainty has a positive effect on quality-screening efforts. Moreover, our findings demonstrate that this effect decreases significantly when food processors purchase frequently from the same source, and when they buy directly from the farm rather than through intermediaries.
Keywords: quality screening efforts; product quality uncertainty; purchase frequency; procurement channel.
Purchasing Category Management: Providing Integration between Purchasing and Other Business Functions
by Jussi Heikkila, Riikka Kaipia, Mika Ojala
Abstract: Organising the purchasing and supply management (PSM) function has been changing due to the increasingly strategic role of the function requiring integration with other business functions and the entire supply chain. One solution is to organise PSM into categories - a common practice in todays manufacturing organisations. In this paper we explore how purchasing category management (PCM) affects cross-functional integration. We analysed purchasing category management practices through in-depth case-studies in four manufacturing firms in two types of industry. Our research contributes to the purchasing and supply management research in two ways. First, it addresses the role of purchasing category management in organising PSM in large manufacturing companies. Second, it elaborates on purchasing categories providing integration between purchasing and other business functions, suggesting how different mechanisms are needed for different contexts.
Keywords: purchasing; procurement; supply management; purchasing category; category management; purchasing category management; organisation; integration; organisational integration; cross-functional integration; case research.
A partial backlogging production-inventory lot-size model with time-varying holding cost and weibull deterioration
by Ajay Singh Yadav, Anupam Swami
Abstract: This paper presents an economic production model with time varying holding cost. The demand and backlogging rates are assumed to be continuous and varying with time. While the production rate is assumed to be stock dependent with unknown time horizon. Shortages are allowed with partial backlogging of demand. Deterioration is taken into consideration and the deterioration rate follows the weibull distribution pattern. The models generate optimal values of initial production run time, onset of shortages, and production recommencement time that minimizes the total relevant costs of production and inventory for any given set of system parameters. A numerical example and sensitivity analysis are given to validate the proposed models.
Keywords: Production; partial backlogging; inventory; variable holding cost; non instantaneous deterioration.
Inventory decisions in a closed-loop supply chain system with learning and rework
by Wakhid Ahmad Jauhari, Oktiviandri Hendaryani, Nughthoh Arfawi Kurdhi
Abstract: In this study, we investigate a closed-loop supply chain model consisting of a manufacturer and a retailer. The retailer orders items from the manufacturer to satisfy end customers demand. The manufacturer uses both regular production and remanufacturing processes to produce items to satisfy the demand from the retailer. The returned items are collected and screened by the manufacturer for recovering process. We consider learning process in both regular production and remanufacturing processes. In addition, the imperfect items produced during regular production are reworked. The model contributes to the current literature by allowing the inclusion of learning process in regular production and remanufacturing processes, imperfect items, rework and multiple cycle policy. Our objective is to optimize the percentage of used item purchasing price per raw material cost, retailer ordering cycle, number of regular production cycles and the number of remanufacturing cycles, so that the joint expected total annual profit incurred has the minimum value. Furthermore, an algorithm is proposed to find the optimal solutions of the proposed model. We also provide a numerical example and conduct a sensitivity analysis to illustrate the models behaviour and feasibility.
Keywords: closed-loop supply chain; reverse logistic; learning; rework; defective item; remanufacturing.
Supply Chain Coordination Voyage towards Supplier Relationship Management: A Critical Review
by Aishwarya Dash, Ranjit Das, Sushant Tripathy
Abstract: Supply Chain Coordination bridges gap between the point of origin and point of consumption in the supply chain network of companies that is from suppliers to end users to manage their dependence on each other. Now-a-days the Manufacturing organizations are using the power of Supplier Relationship for their survival in a high volatile market Place. This Research is focused on hundreds of past research work in the areas of coordination and their findings have been grouped under three categories like factors affecting Supplier Relationship Management (SRM), methodologies used to measure the performance of SRM & trends of SRM. The findings of this exploratory paper is to uncover the meaningful key factors, appropriate methodology used to measure the performance, and focused dynamic trends of supplier relationship management of manufacturing organisation in twenty fast centuries. Our study will be a guideline for supply chain managers to develop a strong covalent bonding with suppliers in present scenario.
Keywords: Supply chain coordination; Supplier Relationship; Performance Measurement Methodology.
e-Tendering Readiness in Construction: An A Priori Model
by Moath Alyahya, Martin Skitmore, Adrian Bridge, Madhav Nepal, David Cattell
Abstract: Electronic tendering (e-Tendering) is moving the construction procurement industry to more professional practice. Nowadays, many organisations have not made the move to e-Tendering or they dont practice e-Tendering fully. However, the growing use of e-Tendering requires organisations to have a minimum of electronic readiness (e-Readiness). In this paper, the need for an e-Tendering model in construction is demonstrated. Additionally, a conceptual e-Tendering Readiness Model (e-TRM) is developed to describe the status of an organisation readiness to adopt e-Tendering. This involves a review of previous e-Tendering models, the importance of e-Tendering models for the construction industry and the requirements for developing e-TRM. The e-TRM is then proposed to assess an organisation readiness prior to e-Tendering implementation. This involves five themes of People, Process, Work Environment, Technology and Service Providers. These five themes consist of 13 constructs representing the basic items of the e-TRM. The Service Providers theme is proposed for the first time as a necessary support for successful e-Tendering implementation. Finally, some suggestions are made for future work to empirically test the e-TRM.
Keywords: e-Tendering; e-procurement.
An Inventory model for Deteriorating Items with Expiry Date and Time Varying Holding Cost
by Seema Sharma, Sanjay Singh, S.R. Singh
Abstract: In this paper, an economic order quantity model for items which deteriorate and expire with time has been developed. The holding cost has been assumed to be a linear function of time, whereas demand has been considered as a function of expiry date and selling price. Shortages are allowed and partially backlogged. The model so developed has been discussed for two cases of partial backlogging (i) backlogging rate is taken to be constant and (ii) backlogging rate depends upon waiting time. A numerical example given here illustrates each case. Finally, sensitivity analysis is carried out to analyze the behavior of the model.
Keywords: Deterioration; Expiry items; Holding Cost; Partial Backlogging.
Analysing Contractor Prequalification Criteria in Construction: New Insights through Interpretive Structural Modeling
by ASHISH GOEL
Abstract: Previous research has established the importance of selecting suitable prequalification criteria to shortlist competent contractors and the role of these criteria in project success. However, very few studies have dealt with establishing hierarchy and investigating interrelationship among prequalification criteria. The rationale of this research is to unearth this seemingly unapparent relationship among these criteria through Interpretive Structural Modeling (ISM). The analysis reveals that financial capability and past performance of contractor, two of most commonly used criteria for contractor prequalification, are inadequate for competent contractor short-listing due to their strong dependence on other criteria. Based on the hierarchy developed in the model, it is suggested that criteria like environmental policy, litigation/blacklisting history and bid capacity of the contractor should be given higher importance by the clients. The findings may improve the prequalification process by assisting the clients in making informed decision regarding selection of prequalification criteria based on the hierarchy and classification established in the model.
Keywords: Prequalification Criteria; Contractor selection; Construction; Interpretive Structural Modeling (ISM); MICMAC.
INTEGRATED SUPPLY CHAIN MODEL FOR DETERIORATING ITEMS WITH LINEAR STOCK DEPENDENT DEMAND UNDER IMPRECISE AND INFLATIONARY ENVIRONMENT
by Ajay Singh Yadav, Anupam Swami
Abstract: In this paper, we develop an integrated supply chain model for deteriorating item, with linear stock dependent demand, taking into account the views of both the vendor and the multi-buyer under imprecise and inflationary environment. We have used the implicit cost in this model and use function principle to calculate the fuzzy total supply chain cost and Graded Mean Integration Representation Method is used to defuzzify the fuzzy total supply chain costs.
Keywords: integrated supply chain model; deteriorating item; linear stock dependent demand; inflationary environment; graded mean integration representation method.
Solving the problem of industry by formulating it as a capacitated transportation problem
by Kavita Gupta
Abstract: This paper presents the solution to the problem of the manager of a trading firm, D.M Chemicals, who deals in the trade of marble powder. The problem of the manager is to determine the quantity (in tons) of marble powder that the firm should purchase from different sellers and sell to the different buyers such that the total cartage and relative purchasing cost is minimized provided the demand and supply conditions are satisfied and the extra demand is also met during emergency situations. The problem under consideration is modeled as a linear plus linear fractional capacitated transportation problem with enhanced flow. The data is taken from the account keeping books of the firm. The solution so obtained by using the developed algorithm is compared with the existing data. Moreover, the solution obtained is verified by a computing software Excel Solver.
Keywords: capacitated; transportation problem; optimal solution; feasible solution; enhanced flow,related transportation problem; corner feasible solution.
Analyzing the European Unions Tenders Electronic Daily: Possibilities and Pitfalls
by Eric Prier, Palina Prysmakova, Clifford McCue
Abstract: As a public policy tool, the open data movement holds out hope of large payoffs in democratic accountability. This paper explores the efficacy of the Tenders Electronic Daily or TED open dataset which covers 33 European countries operating at numerous levels of government. While the recent move toward making the TED open data available in a potentially more user-friendly manner could have been a milestone in realizing a major aspect of the goals of the open data movement, this study demonstrates through numerous procurement examples that the structure of the individual files that comprise this complex dataset is extremely difficult to understand inrnits current form. Moreover, the transparency that may have resulted from this initiative is unlikely to efficiently serve the purposes of public procurement accountability. As a result, the TED open data in its current form should be approached with an abundance of caution.
Keywords: public purchase; e-government; transparency; large-scale dataset; contract award; contract notice.
A framework for buyer satisfaction in E-Procurement in Indian scenario: An integrated ISM and SEM approach
by Manish Gupta
Abstract: E-Procurement is expected to enhance coordination between buyers and suppliers and result in significant mutual satisfaction and economic benefits. However, many organizations that have implemented E-Procurement are highly uncertain about the extent to which the satisfactions are realized. In the present scenario, even though the overall benefits of such systems are established, there is a need to analyze different factors that lead to different levels of buyer satisfaction among different organizations. In this work the ISM model for buyer satisfaction is proposed which is further analytically validated with SEM using AMOS. The results of validation turned out in fair with our developed models for buyer satisfaction. The findings indicate that transparency, improved quality and fulfilling warranty have the maximum driving power whereas long term relationship between buyer-supplier has the maximum driven power. It is furthermore validated in the paper that transparency, improved quality, and fulfilling warranty leads to commitment, cooperation and trust that further on results in long term relationship.
Keywords: E-Procurement; buyer; supplier; buyer satisfaction; Interpretive Structure Modelling; Structure Equation Modelling.
Using mechanism design theory in negotiations to improve purchasing performance
by Ines Schulze-Horn, Niels Pulles, Holger Schiele, Paul Scheffler
Abstract: The purchasing and supply management field persistently seeks new or enhanced negotiation methods to improve purchasing performance. In this regard, mechanism design theory could be applied to make negotiations more effective. By drawing on the basic premises of game theory, mechanism design theory can be used by purchasers to define negotiation rules that incentivise suppliers to reduce purchasing prices. Research on mechanism design theory still appears to be somewhat underrepresented in the traditional purchasing and supply management literature. Therefore, this study provides an introduction to mechanism design theory and explores the benefits of applying it to purchasing and supply management. Additionally, this study presents a case study of 28 projects to examine how mechanism design-based negotiations can be executed and how this negotiation approach differs from conventional approaches. The research shows how mechanism design theory can extend purchasers toolbox of negotiation methods and contribute to purchasing performance.
Keywords: game theory; mechanism design theory; market design; negotiation; purchasing.
EVALUATING CRITICAL FACTORS FOR THE IMPLEMENTATION OF E-PROCUREMENT IN GHANA
by Safowaa Osei-Tutu, Ernest Kissi, Ernest Osei-Tutu, Desmond Addisson
Abstract: E-Procurement implementation in other parts of the world has brought benefits such as efficiency, cost reduction, reduced procurement process, minimized corruption,enhanced compliance and standardization of procurement. Though the Public Procurement Authority has made many strides in the adoption of e-procurement in the Ghanaian Public Sector, the pace for the implementation and adoption is still very slow.Thus, the aim of this study is to evaluate the critical factors for the implementation of e-procurement in Ghana. With the knowledge of these critical factors for e-procurement implementation a survey was conducted involving 60 procurement professionals. The mean score ranking test was then used to determine the factors that were significant to he implementation of e-procurement. The results revealed that availability of internet, power stability ,capacity enhancement of procurement officers, availability of it infrastructure were important critical factors when it comes implementation of e-procurement while the mandatory Use of e-procurement Technical interoperability Budgetary Control among others were of less important. This study therefore evaluate the critical factors for e-procurement implementation in public sectors. The implication is that the findings offers useful factors that will guide the stakeholders and policy makers in e-procurement implementation. It provides practitioners with better understanding of e-procurement environment.
Keywords: E-Procurement,Critical Factors; Ghana; Implementation.
The influence of the Status Quo Bias Theory in the Compliance to Public Procurement Regulations in a Sub-Saharan Economy
by David Asamoah, Jonathan Annan, Diana Effah-Baah
Abstract: The importance of public procurement cannot be overemphasized, as this is a tool for achieving efficiency and value in acquisition of goods, works and services. Public sector bodies are required to conduct public procurement according to public procurement law. However, user resistance to the compliance of the procurement regulations have been reported in extant literature. Yet, there is lack of research on understanding users non-compliance of public procurement laws, especially in sub-Saharan Africa nations such as Ghana. This study uses the Status Quo Bias (SQB) theory to investigate why users fail to comply with the Public Procurement regulations in a Sub-Saharan nation. We collected data from 84 public sector institutions in Ghana and ordinary least square (OLS) regression was used to analyse the measurement and structural models. Three (3) out of the seven (7) hypothesis developed were supported. We offer theoretical and managerial implications.
Keywords: Public Procurement; Status Quo Bias (SQB) theory; Compliance; Firm Resistance; Ghana.
Green supply management in the public and private sector in Hungary
by Gyongyi Vorosmarty, Tunde Tatrai
Abstract: This paper aims to compare the green purchasing practice of the private sector and that of public procurement. Private sector purchasing in western economies is often seen as benchmark for public procurement in terms of efficiency, management processes and management of spending. In this paper we present the results of a literature review and a survey completed in Hungary. The number of publications comparing the two fields is low even in western countries; however the Hungarian data and evaluation show similarities with previous international results. Based on our results supplier management is more important for private organisations, while public entities focus on the procurement process and concentrate on the administrative requirements of national regulations. Due to the lack of East European comparative studies, this paper follows the approach of the European and US literature in terms of concept development.
Keywords: Green purchasing; green public procurement; supplier management.
28 YEARS OF TRACEABILITY MANAGEMENT: Trends, bottlenecks and opportunities
by Dirk-Jan F. Kamann, Jose A. Alfaro, Szabolcs Sebrek
Abstract: This paper shows the evolution of traceability management from 1990-2017 using 124 articles. It lists 73 journals by name, classified in 12 fields of science. We find a dominance of food journals, with journals in supply chain management and IT in a stable second and third position. Articles are coded for 9 possible topics and divided into two categories: theoretical and empirical. An increasing Berry index for the 9 topics shows an increased dispersion across the various topics. Out of the 43 case studies, 36 relate to the food industry, although more recent publications also deal with other sectors. Various relevant theories are discussed and observed bottlenecks are discussed as well as future potential, like using Systems Thinking with Big Data Analysis as an enabler.
Keywords: Traceability; Supply Chain Management; Food industry; Literature Review.
Compliance with transparency provisions in the Public Procurement ACT, 2003 (ACT 663)
by Re. Fr. Baltharzzar Obeng Larbi, Bernard Kofi Baiden, Kofi Agyekum
Abstract: The Public Procurement Act, 2003 (Act 663) was introduced to improve financial management and judicious use of state resources in Ghana. However, many procurement entities in the public sector, especially the Colleges of Education, are said to perform poorly in complying with the key provisions in the Act. This study examines the extent to which the Colleges of Education (COE) in Ghana comply with one of the key provisions; transparency in the Public Procurement Act 663 of Ghana. A questionnaire survey was conducted among 53 Tender Committee members in seven Colleges of Education in Ashanti Region, Ghana. Respondents were interviewed using tools for assessing transparency which were spelt out in five thematic areas to include record of proceedings, giving notice on records, publicizing procurement activities, advertising procurement, and holding proceedings in public. Data obtained was analyzed through percentages, mean scores and relative importance indices. Findings show that the average percentage level of compliance with the transparency provisions in Act 663 among the COEs is 77.4%, indicating that the COEs complied with the transparency provisions in the Act 663. Findings from this study should encourage people in managerial positions in all sectors where procurement is carried out within Ghana to ensure that they comply with the transparency provisions in the act to help fight the menace of corruption.
Keywords: Public procurement; Compliance; Transparency provisions; Recording; Notification; Publicization; Advertising; Proceedings.
Empirical Classification and Effect of Procurement Process on Organizational Performance Outcomes
by Atef Harb, Reine Abou Antoun, Abdallah Kassem, Cesar Baena
Abstract: For many years, Purchasing and Procurement became a major concern for researchers and decision makers worldwide. In Lebanon, the Purchasing functions have become recently a major concern for different organization and industries. The purpose of this research is to investigate the different purchasing clusters of Lebanese industrial organization and to study their effect on organizational management and performance. In order to achieve our objective, two research questions are addressed. (1) How purchasing functions within Lebanese organizations are classified? (2) How do purchasing functions in the Lebanese organizations affect performance outcomes? These research questions have been translated into the following two hypotheses: (H1) Purchasing functions within the Lebanese organizations/industries can be classified based on their level of involvement in strategic planning, status in the eyes of top management, degree of internal integration, and purchasing skills. (H2) Based on different configurations of purchasing characteristics, different purchasing functions will have higher levels of performance outcomes. To answer the research questions and to test the hypotheses, analyses were conducted based on collected data from 95 Lebanese organizations. The researchers developed a research instrument with 19 indicators to measure performance outcomes (PO) as the dependent variable, and 18 indicators to measure purchasing clusters (PC) as the independent variable. Data were collected via a paper-based, telephone, and email survey questionnaire. Using SPSS, descriptive testing, principal component analysis, and linear regression techniques were used to investigate the relationships among variables and to illustrate the impact of (PC) on (PO) in the Lebanese organizations. The results presented that the hypothesized measurement models are valid and reliable to answer the research questions. Findings supported the two hypotheses and showed a statistically significant relation between the two studied variables. As a conclusion, this research assessesed, analyzed and presented the importance of purchasing clusters and showed its positive influence on organizational performance in the Lebanese organizations/industries. The most efficient purchasing functions included strategic planning, purchasing status, internal integration, purchasing skills and affected supplier integration; supplier relationships outcomes, production performance, and financial performance helping all decision makers involved to better control and plan for the best achievements of the optimal decisions and the expected results. The findings will be very useful for researchers and practitioners seeking to improve the performance and standing of the purchasing function through the identification of the different characteristics and potential limitations faced at each phase. Also, they will be very helpful for engineers and IT managers to know the concept for the best implementation of a new engineering system and/or a new software.
Keywords: Purchasing; Procurement; Purchasing Clusters; Performance Outcome; Organizational Performance; Management; Internal Integration; Strategic Planning; Engineering Design.
Preserve the Relative Efficiency Values: An Inverse Data Envelopment Analysis with Imprecise Data
by Mojtaba Ghiyasi, Sahar Khoshfetrat
Abstract: Data Envelopment Analysis (DEA) measures the relative efficiency of a set of Decision Making Units (DMUs) according to the available input-output data. With the advent of DEA models, Inverse DEA is applied to modify the inputs and outputs of DMUs without affecting their efficiency. Inverse DEA models are applied when the decision makers need to change the input-outputs of the DMUs to a certain level without affecting their efficiency. In fact, Inverse DEA models are extended when the input-output data are imprecise and available in the intervals form. However, with regard to uncertainty, complete information about the input-output data is not available in many real world applications. To address this problem, this study deals with the Inverse DEA problem in an uncertain environment. Therefore, two Multi-Objective Linear Programming (MOLP) models are proposed to estimate the required upper/lower inputs, producing requested outputs and preserving the efficiency scores. Proposed models preserve the upper/lower efficiency scores of all considered DMUs. A numerical example is provided to illustrate the proposed methodology of this study. According to the results, it is shown that proposed models provide better results in terms of required upper/lower inputs.
Keywords: Inverse DEA; Imprecise data; Interval data; MOLP.
Contingent variables to the price charged by hotels
by Maria João Machado
Abstract: This study has two specific objectives: to analyse the association between the hotel features and the price practiced; to analyse whether the performance evaluation tools used are associated with the price charged by the hotels. Data collection began with a survey directed at the financial managers of 4 and 5 star hotels located in Portugal to collect information on the performance evaluation tools used, and on some hotel features. I obtained 241 completed questionnaires, and to meet the objectives proposed, I also collected the price charged by the responding hotels, using the online platform Booking.com. The results obtained help us to fill a knowledge gap identified in the literature review regarding the influence of the hotels operating conditions on the price practiced, since it leads to the conclusion that hotel features and the performance evaluation tools used influence the price practiced.
Keywords: hotel price; performance evaluation tools; Balanced Scorecard; Tableau de Bord; hotel features; hotel industry; contingent variables.
A Mixed Integer Linear Programming Model for Dynamic Supplier and Carrier Selection Problems
by Purnawan Adi Wicaksono, I. Nyoman Pujawan, Erwin Widodo
Abstract: The dynamic supplier selection problem (DSSP), which occurs when no supplier can fulfil the buyers total demand due to various limitations, has received attention from academics. However, to the best of our knowledge, there is no publication that addresses the DSSP and carrier selection simultaneously. Given that products are sourced from different suppliers, the choice of carrier is important in order to satisfy demand at the minimum total cost. In this paper we present a model that integrates the DSSP and carrier selection under uncertain delivery performance; that is, a portion of orders are not delivered on time and a portion of delivered goods are imperfect and hence are rejected by the buyer. We propose a mixed integer liner programming (MILP) model and apply it to a case where a buyer is sourcing multiple items from multiple suppliers and the decision has to be made on a multi-period planning horizon. A numerical example has been tested to show the effectiveness of the model. We assume that backlogging is allowed and the effect of demand fluctuation is analysed.
Keywords: dynamic supplier selection; carrier selection; mixed integer linear programming; delivery performance.
Purchasing Inventory Models for Exponential Demand with Deteriorating items and Discounted Cost in Third Order Equation
by Sivashankari C.K.
Abstract: The purpose of this article is to present a solution procedure for the inventory problem of deteriorating items and Exponential demand taking account of time value of money. Also, most of the works on inventory models do not take the optimal solution in higher order equation. In this paper, inventory models for deterioration items with time dependent exponential demand under inflation and the optimum solution is derived in higher order equations. Two models are developed and the optimum time and total cost are derived (i) when the demand is exponential with deterioration items, (ii) demand is exponential with deterioration items and discounted cost. Mathematical models are developed for each model and the optimum time and optimal lot size which minimizes the total cost is derived. Numerical examples are given to illustrate the theoretical results and made the sensitivity analysis of parameters on the optimal solutions. The validation of result, this model was coded in Microsoft Visual Basic 6.0
Keywords: Inventory; Deteriorating; Exponential Demand; Discounted cost and Third order equation.
An Organisational Approach to Sustainable Public Procurement
by Ridzuan Kushairi M.R.
Abstract: A systematic review of the literature on public procurement found that social and environment objectives were adopted in economic development over the last three decades. The need to incorporate social and environmental objectives in economic development was found to be an ethical approach in governance. The adoption was aimed at addressing socio-economic justice and environmental protection in economic development. Studies found that the sustainable adoption objectives by the public sector lacked progress. This was due to varied objectives adopted in public procurement and the inefficiency of the adoption process. The factors that affect the sustainable agenda were institutional and stakeholder factors. An interview process was undertaken of the federal agencies public procurement system to investigate the institutional and stakeholder factors of the public sector in adopting social and environmental objectives in public procurement. The investigation was approached from the perspective of the organisation as a multi-structure system involving hierarchies, people, and the system of administration and governance. This study found that collaboration among stakeholders in the organisation structure played an important role in enhancing the adoption of social and environmental objectives in public procurement by adopting different types of knowledge within a bounded and complex multi structure system of the organisation. This provided contributions to the practitioners and policy makers a basis for designing public procurement policies and regulations.
Keywords: Sustainable Public Procurement; Organisation Structure; Public Procurement.
The Power of Public Procurement: Social Equity and Sustainability as Externalities and as Deliberate Policy Tools
by Mohamad Alkadry
Abstract: Cities in the United States are facing the impacts of climate change and socio-economic disparities on a daily basis. This article emphasises the increasing importance of adoption of sustainability policies at the local government level. This premise is based on Everett Rogers Diffusions of Innovations theory, which indicates that organisations can be trendsetters in their policy decisions. Local governments are increasingly becoming trendsetters in leading other public and even private organisations on sustainability efforts in general, and in sustainable procurement in particular. The research on what drives a local government's involvement in sustainable procurement is scarce. This study analyses survey responses from 207 U.S. regional and local governments who are member agencies of the National Institute of Government Purchasing (NIGP). A model analysing organisational, regional socio-economic, and regional demographic variables was created and tested. Results demonstrate that political leanings, degree of professionalisation, and access to decision makers are the most significant predictors of variance in adoption of sustainable procurement practices. We conclude that ethical spending of public dollars to achieve sustainable outcomes (i.e. sustainable procurement) is more likely to be influenced by the political leanings of the population than by the capacity of the local government to institute and enforce sustainable practices.
Keywords: sustainability; sustainable public procurement; local government.
Inventory Model for Deteriorating Items with Price and Time Dependent Seasonal Demand
by Pratibha Sharma, Ashish Sharma, Sanjay Jain
Abstract: Deteriorating items are considered as the main source of revenue. Many deteriorating items pusses the seasonal demand pattern. Generally, the sellers made a bulk purchase during the season and used the replenished inventory over a number of successive demand seasons. Thus, the inventory models for deteriorating item with a seasonal demand will provide valuable managerial insights. We developed a deterministic inventory model with price and time-dependent seasonal demand rate for items undergoing constant deterioration. Replenished inventory is used for more than one successive seasons and after depletion, at the end of the season order is placed for next replenishment. Shortages are considered only for one season. Time-dependent partial backlogging is considered for shortages. Analytical results for the optimality of the profit function with respect to decision variables in closed-form expressions are presented. Solution procedure and analytical results are verified with a numerical example.
Keywords: Inventory; Deterioration; Seasonal demand; Time and price dependent demand; Backlogging.
Implementing e-tendering to improve the efficiency of public construction contract in Saudi Arabia
by Moath Al-Yahya, Kriengsak Panuwatwanich
Abstract: The demand from the construction industry for paperless business processes has increased the use of e-tendering systems around the world. E-tendering systems are quite complex since they involve many stages to meet the need of construction sectors. This paper developed an e-tendering model the public construction contract in Saudi Arabia to improve its efficiency with addresses the dilemma of traditional tendering. Moreover, to assist the development of the proposed e-tendering model, literature review, ten interviews, a focus group, and 52 questionnaire participants are conducted. Therefore, the model allows a contractor to be involved during the design stage and involved officially during the design process. This feature seeks to minimise the pre-construction time, reduce the bidder's risks and maximise the quality and transparency of e-tendering. As a result, this paper identified the stage of tender document handling to the bidders is the most affected stage toward more efficient of e-tendering process.
Keywords: construction; e-government; e-business; e-procurement; tendering; procurement; e-tendering; e-bidding; bidding; tender.
Optimal selling price and lot size for non-instantaneous deteriorating items with different demand rates and partial backlogging
by Ajay S. Gor, Hetal R. Patel
Abstract: This study is an extension of Maihami and Kamalabadi (2012a) (Int. J. Production Economics, Vol. 136, pp.116-122) by taking the demand rate as general function of price and time and it is different in different time interval. When deterioration starts, price discount is offered. This study also considers deterioration rate as general function of time. Back order rate is also taken as general function to develop a model. Numerical examples are presented to illustrate the model. Sensitivity analysis is carried out for major parameters and some managerial insights are proposed.
Keywords: non-instantaneous deterioration; generalised demand rate; back order rate; price discount.
An analysis of replenishment model of deteriorating items with ramp-type demand and trade credit under the learning effect
by Archana Sharma, Usha Sharma, Chaman Singh
Abstract: Effective management and control strategies are prerequisites in order to optimise inventory related decisions. Robust replenishment model can reduce overall inventory cost and increase financial surplus for the organisation. Adoption of trade credit strategy for deteriorating items provides economic benefits to the retailer (buyer) in settling the account for the fixed period and boosts the sales of the organisation. Therefore, in this proposed model trade credit is introduced and demands pattern follows ramp-type which is quadratic function of time for decaying items. Shortages are allowed and partially backlogged where the backlogging rate is dependent of waiting time. The inflation factor is also considered to propose realistic environment. Additionally, this study also considered the cost components which are followed by learning curve to improve the total inventory cost with strategic scheduling. Finally, the model is analysed through numerical examples and the sensitivity analysis is performed to test the robustness of the model.
Keywords: ramp-type demand; partial backlogging; learning effect; trade credit; inflation.
Interactional function of risk management and value engineering in civil projects (case study: 108-unit residential complex project in Parand New Town)
by Majid Razeghi Jahromi, Fatemehsadat Mousavifard, Abdolhossein Ayoubi
Abstract: Risk management is known as a process of properties maintenance and the ability in money making and value engineering and management is an inseparable part of risk management. Unified value management and risk management establishes synergy. This study is done with the intention of studying interactional function of value engineering and risk management in civil projects while Dallas model is considered as theoretical model. In this study implementation of value engineering and risk management was done in a unified practical way. Findings indicate that implementation of his model in construction phase of building project will lead to decrease in approximately certain costs as much as 24.77% while project temporary delivery and finalising the project are getting near, decrease rate of final costs will reach 21.32%. After procedures and studying results of tables, it can be concluded that interactional function of risk management and value engineering in this project was accompanied with 7.35% of savings.
Keywords: risk management; value engineering; civil projects; residential complex project; interactional function; costs; saving; maintenance; delivery; risk measurement.
An analytical approach for EOQ determination using trapezoidal fuzzy function
by Sudhir Kumar Sharma, Srikrishna Madhumohan Govindaluri
Abstract: Inventory management involves ordering right quantities of items for matching demand and supply. In inventory management, economic order quantity (EOQ) problem deals with determining the quantity to be ordered for minimising the sum of ordering and holding costs. This problem has been discussed by a number of researchers under the assumptions of deterministic and uncertain environments. Many studies have also employed fuzzy sets to characterise the imprecision and uncertainty of supply chains in EOQ models. This paper proposes a fuzzy EOQ model where the decision variables, batch order quantity and maximum inventory, are modelled using trapezoidal numbers. The signed distance method is used for defuzzification. The results show that the trapezoidal fuzzy model allows incorporating uncertainty using the proposed fuzzy economic order quantity model with only a slight increase in the batch order quantities and total cost per unit compared to the crisp economic order quantity model, which assumes deterministic conditions.
Keywords: trapezoidal fuzzy number; economic order quantity; EOQ; inventory management; signed distance method; total cost per unit.
Lead time reduction: early supplier involvement and the information supply chain
by John D. Hanson
Abstract: Lead time reduction is a central concern of procurement, but is critical in the initial launch of newly designed or revised products. Early supplier involvement is often advocated for reducing these lead times, but empirical studies show equivocal results. This paper draws from literature on concurrent engineering to explore the mechanisms available for lead-time reduction in the supply chain. It is shown that these mechanisms depend on flows of the information that is created during the process. There is, in effect, a supply chain for information that must be recognised and managed. Conditions are identified that are necessary for early supplier involvement to result in lead time reduction and offered as testable hypotheses for future research.
Keywords: early supplier involvement; ESI; lead time reduction; LTR; concurrent engineering; 3DCE.
Optimising safety stocks and reorder points when the demand and the lead-time are probabilistic in cement manufacturing
by Karzan Mahdi Ghafour
Abstract: Inventory control is an extremely challenging task, complicated by a probability of demand and lead-time. An inventory system attempts to balance between overstock and understock to reduce the total cost and achieve customer demand in a timely manner. The optimality of inventory policies for a cement industry is still unknown for many types of inventory systems. In this paper, probability distribution of demand during lead-time is considered when the demand and lead-time are probabilistic while extracting the optimal safety stock placement and the reorder point in cement manufacturing. Probability distributions of demand during lead-time include Pearson type 6 four-parameter, log-Pearson 3, fatigue life (Birnbaum-Saunders), and inverse Gaussian three-parameter distributions. The probability distribution of demand during lead-time is established when the demand and the lead-time are probabilistic; each one has a probability distribution function. The safety stock depends on the safety factor under certain service level and the standard deviation of demand during lead-time which can be obtained from the distribution. The quantities of the safety stock and the reorder point represent an optimal value at each position to avoid over or under stock, the most controversial issue in the inventory system.
Keywords: safety stocks; reorder points; probabilistic demand; lead-time.