Multicriteria Green Supplier Segmentation

Supplier segmentation is an important strategic activity for companies. The main purpose of segmenting suppliers is to more easily manage a large number of suppliers by formulating relationship management strategies for subsets of suppliers, which is more efficient than separate unique strategies for each supplier. Existing supplier segmentation approaches have paid limited attention to environmentally related criteria. Given the increased importance of sustainable and green supply chains, this points a large gap in the literature. Thus, a green supplier segmentation model is proposed in this study. A supplier potential matrix is used to evaluate suppliers with respect to two dimensions, capabilities and willingness, with respect to environmental issues. Given the multicriteria nature of this problem, a novel hybrid multicriteria methodology is used to evaluate the problem. Rough set theory is used to calculate the weight of each criterion for suppliers' capabilities and suppliers' willingness. VlseKriterijumska Optimizacija I Kompromisno Resenje (VIKOR) is then used to determine an overall score for each supplier. Finally, fuzzy C-means is used to segment the suppliers while considering the overall score for each supplier. An application of the proposed model for suppliers of a large chemical company is used to evaluate the feasibility of this technique.