Analyzing the sourcing alternatives in an Indian manufacturing company

The purpose of this paper is to analyze the sourcing alternatives (i.e. supplier development (SD), supplier switching (SS) and in‐house production (IP)) in an Indian manufacturing supply chain environment.

A total of 14 attributes are identified through an extensive literature review and discussion held with managers/engineers of different Indian manufacturing companies for analyzing the sourcing alternatives. A systematic methodology is proposed and applied, comprising a fuzzy analytic hierarchy process (FAHP) for analyzing the sourcing alternatives followed by the application of classical analytic hierarchy process (AHP) for result verification.

From the results obtained from both AHP and FAHP, it is established that the SD is the most preferred alternative in comparison to other two alternatives (i.e. SS and IP) for the considered Indian manufacturing environment.

The same problem can be extended by incorporating the dynamic behavior of the attributes. The findings cannot be generalized for any other company as it is based on a single Indian manufacturing company.

The paper demonstrates a methodology to evaluate the sourcing alternatives considering judgment of multiple experts in a systematic way. It is believed that it will be quite useful for the supply chain manager to analyze sourcing alternatives by capturing his manufacturing environment into priority weights, which can reflect his priority considerations.

Although SD, SS and IP have been widely researched individually, no study has been reported in the literature to evaluate and rank these three alternatives in any specific Indian manufacturing environment.