Green supplier selection using an AHP-Entropy-TOPSIS framework

Purpose - Strategies that balance economic and environmental performance are increasingly sought after as enterprises focus more and more on the sustainability of their operations. Green supply chain management (GSCM) in particular, enables the integration of environmentally-friendly suppliers into the supply chain to be systematised to fit with specific environmental regulations and policies (Rao, 2002). More persuasively, GSCM allows enterprises to improve profits whilst lowering impacts on the global environment (Van Hock and Erasmus, 2000). The research focuses on development of a green supplier selection model using an index system based on a combination of traditional supplier and environmental supplier selection criteria. Design/methodology/approach – A two-phase survey approach was adopted for the research. For the first phase, semi-structured interviews with senior management representatives of the case company - an electronic machinery manufacturer based in China – were used to determine green supplier selection criteria. For the second phase, a two-part questionnaire survey was undertaken, online. The first part provided the data for an analytic hierarchy process analysis of the first phase criteria, the second part with collecting data for the Entropy weight analysis. The resultant AHP and Entropy weights were then combined to form compromised weights - which, using the TOPSIS method, were translated into preferential rankings of suppliers. Findings –Senior managers were found to rank traditional criteria more highly than environmental alternatives – the implication being that for the company, concerned, it may take some time before environmental awareness is fully assimilated into GSCM practice Originality/value – As far as is known, this is the first application of AHP / Entropy / TOPSIS methodology in the area of GSCM. As with any prototype, the approach is clearly not without its limitations: for example, the results are necessarily conditioned by the particular set of green supplier selection criteria obtained. Notwithstanding the latter, the results, overall, appear very insightful, suggesting the technique could offer considerable promise for GSCM analysis in the future.