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A fuzzy AHP based integer linear programming model for the multi‐criteria transshipment problem

Ting He (Harbin Institute of Technology, Harbin, China and Aston Business School, Aston University, Birmingham, UK)
William Ho (Aston Business School, Aston University, Birmingham, UK)
Carman Lee Ka Man (The Hong Kong Polytechnic University, Hong Kong, Hong Kong)
Xiaofei Xu (Harbin Institute of Technology, Harbin, China)

The International Journal of Logistics Management

ISSN: 0957-4093

Article publication date: 18 May 2012

Abstract

Purpose

The purpose of this research is to develop a holistic approach to maximize the customer service level while minimizing the logistics cost by using an integrated multiple criteria decision making (MCDM) method for the contemporary transshipment problem. Unlike the prevalent optimization techniques, this paper proposes an integrated approach which considers both quantitative and qualitative factors in order to maximize the benefits of service deliverers and customers under uncertain environments.

Design/methodology/approach

This paper proposes a fuzzy‐based integer linear programming model, based on the existing literature and validated with an example case. The model integrates the developed fuzzy modification of the analytic hierarchy process (FAHP), and solves the multi‐criteria transshipment problem.

Findings

This paper provides several novel insights about how to transform a company from a cost‐based model to a service‐dominated model by using an integrated MCDM method. It suggests that the contemporary customer‐driven supply chain remains and increases its competitiveness from two aspects: optimizing the cost and providing the best service simultaneously.

Research limitations/implications

This research used one illustrative industry case to exemplify the developed method. Considering the generalization of the research findings and the complexity of the transshipment service network, more cases across multiple industries are necessary to further enhance the validity of the research output.

Practical implications

The paper includes implications for the evaluation and selection of transshipment service suppliers, the construction of optimal transshipment network as well as managing the network.

Originality/value

The major advantages of this generic approach are that both quantitative and qualitative factors under fuzzy environment are considered simultaneously and also the viewpoints of service deliverers and customers are focused. Therefore, it is believed that it is useful and applicable for the transshipment service network design.

Keywords

Citation

He, T., Ho, W., Lee Ka Man, C. and Xu, X. (2012), "A fuzzy AHP based integer linear programming model for the multi‐criteria transshipment problem", The International Journal of Logistics Management, Vol. 23 No. 1, pp. 159-179. https://doi.org/10.1108/09574091211226975

Publisher

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Emerald Group Publishing Limited

Copyright © 2012, Emerald Group Publishing Limited