Product Quality Delivery Speed Product Price Environmental Impact SUPPLIER RATING UNDER LOW, MODERATE, AND HIGH LEVELS OF DEMAND Local Supplier National Supplier Moderate 6 7 5 9 Weight 0.35 0.15 0.25 0.25 Low 8 9 5 9 High 5 3 3 9 Low 7 6 5 7 Moderate 7 6 7 7 High 7 6 9 7 International Supplier Moderate 6 5 7 8 Low 6 4 7 8 High 6 7 9 8
Adelie Enterprises is exploring a new service to provide
weekly delivery of grocery items to homes in the greater
Greenwood area. The company’s customers place Web-based
orders and Adelie’s team assembles and delivers the orders in
specially designed cardboard boxes. Management, interested
in locating a supplier that can provide boxes cheaply and efficiently, has discovered that each potential supplier’s abil-
ity to satisfy the company’s requirements is influenced by the
level of demand. The following table provides Adelie’s ven-
dor selection criteria, criterion weights, and rankings (1–10
with 10 being the highest) under the assumption that low,
moderate, or high demand is generated for their service.
a. Which supplier should be selected if there is low demand
for Adelie’s new service? Which supplier should be
selected under moderate demand assumptions? Under
high demand assumptions?
b. Which supplier is selected if Adelie evaluates each
alternative using a Maximin decision criterion (see
Supplement A, “Decision Making”)?
c. Which supplier achieves the highest expected ranking
if the probability of low demand is 35 percent, moderate demand is 45 percent, and high demand is
20 percent?
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