Institut for Forretningsudvikling og Teknologi

Kamran Rashidi

Categorizing suppliers for development investments in construction: application of DEA and RFM concept: Construction Management and Economics

Publikation: Bidrag til tidsskrift/Konferencebidrag i tidsskrift /Bidrag til avisTidsskriftartikelForskningpeer review

  • A. Noorizadeh, Aalto University, Helsinki, Finland
  • K. Rashidi
  • A. Peltokorpi, Aalto University, Finland
Supplier development plays a significant role in the cost, quality and delivery improvements of construction projects. However, there is limited research on analytical methods of categorizing and prioritizing a high number of suppliers for effective allocation of scarce development resources. This research aims to develop an objective model to categorize a general contractor’s suppliers. To do so, we use three concepts from different research backgrounds–recency, frequency and monetary value (RFM); data envelopment analysis (DEA); and the customer pyramid–and add the number of projects (P) shared with each supplier as a context-related variable to build a novel RFMP model. The model categorizes suppliers into four levels of the supplier pyramid, utilizing historical data on supplier–contractor transactions. To test the model in practice, we adopt a case study of an international construction company in Finland. The results reveal that a supplier’s RFMP score reflects its contribution to the contractor’s business; therefore, development investments should vary, based on a supplier’s position in the supplier pyramid. This research contributes to the knowledge on supply chain management in construction by combining three approaches–RFM, DEA and the customer pyramid–into a single objective model to categorize suppliers for effective development investments. © 2018, © 2018 Informa UK Limited, trading as Taylor & Francis Group.
OriginalsprogEngelsk
TidsskriftConstruction Management and Economics
Vol/bind36
Nummer9
Sider (fra-til)487-506
Antal sider20
ISSN0144-6193
DOI
StatusUdgivet - 2018
Eksternt udgivetJa

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