Supplier Selection through Application of DEA

In the increasing competition it has become important in business world to understand the different aspects of production and purchasing to understand the need for desired material in the organization. The managers have an important responsibility of selecting a good supplier by evaluating them on different parameters which is directly or indirectly associated with their overall performance. For decision making based on multiple criteria evaluation many methods of Multi-Criteria Decision Making (MCDM) is used by firms. Data Envelopment Analysis (DEA) is prominently used by firms nowadays. In this paper, analysis of DEA is done by measuring supplier performance of two firms: multi-national telecommunication corporation and a manufacturing firm. The firm uses the methodology according to their requirement and criteria for evaluating their suppliers and find best among them.