IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v11y2019i7p1872-d217971.html
   My bibliography  Save this article

An Integrated Multi-Criteria Decision-Making Model Based on Prospect Theory for Green Supplier Selection under Uncertain Environment: A Case Study of the Thailand Palm Oil Products Industry

Author

Listed:
  • Patchara Phochanikorn

    (School of Business, Central South University, Changsha 410083, Hunan, China)

  • Chunqiao Tan

    (School of Business, Central South University, Changsha 410083, Hunan, China
    School of Economics and Management, Nanjing University of Information Science and Technology, Nanjing 210044, Jiangsu, China)

Abstract

Environmental concerns have globally driven the encouragement of green supply chain management. Accordingly, business and industrial organizations try to seek green supply chain strategies to respond to market pressure regarding corporate social responsibility. Green supplier selection is one of the practical strategies for modern enterprises. With the large-scale development of the palm oil products industry, green supplier selection technique is the key for decision making when dealing with mass information and possible risks of biased data. For instance, the preference of decision makers possibly causes a misleading decision, thus leading to unnecessary waste of resources. Therefore, the contribution of this paper is to apply the integrated multi-criteria decision method using the ‘fuzzy decision-making trial and evaluation laboratory’ (fuzzy DEMATEL) method to consider the cause and effect relationship and then using fuzzy analytic network process (fuzzy ANP) to assign the weight of each relevant criteria. The initial results are useful for strategic procurement planning. In the final step, we adopt the prospect theory to synthesize procurement’s psychological and behavioral factors when selecting green suppliers. The final result refers to the comprehensive prospect value to rank the eligible suppliers into orders. Moreover, the results of both sensitivity analysis and comparison method confirm that the proposed model is adequately realistic and robust.

Suggested Citation

  • Patchara Phochanikorn & Chunqiao Tan, 2019. "An Integrated Multi-Criteria Decision-Making Model Based on Prospect Theory for Green Supplier Selection under Uncertain Environment: A Case Study of the Thailand Palm Oil Products Industry," Sustainability, MDPI, vol. 11(7), pages 1-22, March.
    • Handle: RePEc:gam:jsusta:v:11:y:2019:i:7:p:1872-:d:217971
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/11/7/1872/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/11/7/1872/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Wei Song & Zhiya Chen & Xuping Wang & Qian Wang & Chenghua Shi & Wei Zhao, 2017. "Environmentally Friendly Supplier Selection Using Prospect Theory," Sustainability, MDPI, vol. 9(3), pages 1-17, March.
    2. Tien-Chin Wang & Su-Yuan Tsai, 2018. "Solar Panel Supplier Selection for the Photovoltaic System Design by Using Fuzzy Multi-Criteria Decision Making (MCDM) Approaches," Energies, MDPI, vol. 11(8), pages 1-22, July.
    3. Eleonora Bottani & Piera Centobelli & Teresa Murino & Ehsan Shekarian, 2018. "A QFD-ANP Method for Supplier Selection with Benefits, Opportunities, Costs and Risks Considerations," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 17(03), pages 911-939, May.
    4. Opricovic, Serafim & Tzeng, Gwo-Hshiung, 2004. "Compromise solution by MCDM methods: A comparative analysis of VIKOR and TOPSIS," European Journal of Operational Research, Elsevier, vol. 156(2), pages 445-455, July.
    5. Peng Jiang & Yi‐Chung Hu & Ghi‐Feng Yen & Shu‐Ju Tsao, 2018. "Green supplier selection for sustainable development of the automotive industry using grey decision‐making," Sustainable Development, John Wiley & Sons, Ltd., vol. 26(6), pages 890-903, November.
    6. Hua Shi & Mei-Yun Quan & Hu-Chen Liu & Chun-Yan Duan, 2018. "A Novel Integrated Approach for Green Supplier Selection with Interval-Valued Intuitionistic Uncertain Linguistic Information: A Case Study in the Agri-Food Industry," Sustainability, MDPI, vol. 10(3), pages 1-18, March.
    7. Amos Tversky & Daniel Kahneman, 1991. "Loss Aversion in Riskless Choice: A Reference-Dependent Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(4), pages 1039-1061.
    8. Wu, Yunna & Xu, Chuanbo & Zhang, Ting, 2018. "Evaluation of renewable power sources using a fuzzy MCDM based on cumulative prospect theory: A case in China," Energy, Elsevier, vol. 147(C), pages 1227-1239.
    9. Chang, Da-Yong, 1996. "Applications of the extent analysis method on fuzzy AHP," European Journal of Operational Research, Elsevier, vol. 95(3), pages 649-655, December.
    10. Qin, Jindong & Liu, Xinwang & Pedrycz, Witold, 2017. "An extended TODIM multi-criteria group decision making method for green supplier selection in interval type-2 fuzzy environment," European Journal of Operational Research, Elsevier, vol. 258(2), pages 626-638.
    11. Govindan, Kannan & Shankar, Madan & Kannan, Devika, 2018. "Supplier selection based on corporate social responsibility practices," International Journal of Production Economics, Elsevier, vol. 200(C), pages 353-379.
    12. Khatun, Rahima & Reza, Mohammad Imam Hasan & Moniruzzaman, M. & Yaakob, Zahira, 2017. "Sustainable oil palm industry: The possibilities," Renewable and Sustainable Energy Reviews, Elsevier, vol. 76(C), pages 608-619.
    13. Wei Song & Zhiya Chen & Aijun Liu & Qiuyun Zhu & Wei Zhao & Sang-Bing Tsai & Hui Lu, 2018. "A Study on Green Supplier Selection in Dynamic Environment," Sustainability, MDPI, vol. 10(4), pages 1-22, April.
    14. Awasthi, Anjali & Govindan, Kannan & Gold, Stefan, 2018. "Multi-tier sustainable global supplier selection using a fuzzy AHP-VIKOR based approach," International Journal of Production Economics, Elsevier, vol. 195(C), pages 106-117.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gerda Ana Melnik-Leroy & Gintautas Dzemyda, 2021. "How to Influence the Results of MCDM?—Evidence of the Impact of Cognitive Biases," Mathematics, MDPI, vol. 9(2), pages 1-25, January.
    2. Wentao Yi & Chunqiao Tan, 2019. "Bertrand Game with Nash Bargaining Fairness Concern," Complexity, Hindawi, vol. 2019, pages 1-22, August.
    3. Xue-Guo Xu & Hua Shi & Li-Jun Zhang & Hu-Chen Liu, 2019. "Green Supplier Evaluation and Selection with an Extended MABAC Method Under the Heterogeneous Information Environment," Sustainability, MDPI, vol. 11(23), pages 1-16, November.
    4. Jian-Peng Chang & Heng-Xin Ren & Luis Martínez & Witold Pedrycz & Zhen-Song Chen, 2024. "Requirement-driven supplier selection: a multi-criteria QFD-based approach under epistemic and stochastic uncertainties," Annals of Operations Research, Springer, vol. 342(2), pages 1079-1128, November.
    5. Muhammad Ikram & Qingyu Zhang & Robert Sroufe & Marcos Ferasso, 2020. "The Social Dimensions of Corporate Sustainability: An Integrative Framework Including COVID-19 Insights," Sustainability, MDPI, vol. 12(20), pages 1-29, October.
    6. Patchara Phochanikorn & Chunqiao Tan, 2019. "A New Extension to a Multi-Criteria Decision-Making Model for Sustainable Supplier Selection under an Intuitionistic Fuzzy Environment," Sustainability, MDPI, vol. 11(19), pages 1-24, September.
    7. Qiu-Rui He & Ping-Kuo Chen, 2023. "Developing a green supplier evaluation system for the Chinese semiconductor manufacturing industry based on supplier willingness," Operations Management Research, Springer, vol. 16(1), pages 227-244, March.
    8. Soleman Imbiri & Raufdeen Rameezdeen & Nicholas Chileshe & Larissa Statsenko, 2023. "Stakeholder Perspectives on Supply Chain Risks: The Case of Indonesian Palm Oil Industry in West Papua," Sustainability, MDPI, vol. 15(12), pages 1-24, June.
    9. Aldona Kluczek & Patrycja Żegleń & Daniela Matušíková, 2021. "The Use of Prospect Theory for Energy Sustainable Industry 4.0," Energies, MDPI, vol. 14(22), pages 1-29, November.
    10. Zongxian Liu & Wenshuai Song & Bo Cui & Xiaoling Wang & Hongling Yu, 2019. "A Comprehensive Evaluation Model for Curtain Grouting Efficiency Assessment Based on Prospect Theory and Interval-Valued Intuitionistic Fuzzy Sets Extended by Improved D Numbers," Energies, MDPI, vol. 12(19), pages 1-30, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kannan Govindan & Aditi & Jyoti Dhingra Darbari & Arshia Kaul & PC Jha, 2021. "Structural model for analysis of key performance indicators for sustainable manufacturer–supplier collaboration: A grey‐decision‐making trial and evaluation laboratory‐based approach," Business Strategy and the Environment, Wiley Blackwell, vol. 30(4), pages 1702-1722, May.
    2. Jian-Peng Chang & Heng-Xin Ren & Luis Martínez & Witold Pedrycz & Zhen-Song Chen, 2024. "Requirement-driven supplier selection: a multi-criteria QFD-based approach under epistemic and stochastic uncertainties," Annals of Operations Research, Springer, vol. 342(2), pages 1079-1128, November.
    3. Chong Li & He Huang & Ya Luo, 2022. "An Integrated Two-Dimension Linguistic Intuitionistic Fuzzy Decision-Making Approach for Unmanned Aerial Vehicle Supplier Selection," Sustainability, MDPI, vol. 14(18), pages 1-24, September.
    4. Nebiyu Kedir & Phuong H. D. Nguyen & Citlaly Pérez & Pedro Ponce & Aminah Robinson Fayek, 2023. "Systematic Literature Review on Fuzzy Hybrid Methods in Photovoltaic Solar Energy: Opportunities, Challenges, and Guidance for Implementation," Energies, MDPI, vol. 16(9), pages 1-38, April.
    5. Syed Hammad Mian & Khaja Moiduddin & Hisham Alkhalefah & Mustufa Haider Abidi & Faraz Ahmed & Faraz Hussain Hashmi, 2023. "Mechanisms for Choosing PV Locations That Allow for the Most Sustainable Usage of Solar Energy," Sustainability, MDPI, vol. 15(4), pages 1-24, February.
    6. Almalky,, 2020. "An Integrated Multi‐Criteria Decision Support Framework for the Selection of Suppliers in Small and Medium Enterprises based on Green Innovation Ability," OSF Preprints 3cg8j, Center for Open Science.
    7. Dan-Ping Li & Li Xie & Peng-Fei Cheng & Xiang-Hong Zhou & Cheng-Xun Fu, 2021. "Green Supplier Selection Under Cloud Manufacturing Environment: A Hybrid MCDM Model," SAGE Open, , vol. 11(4), pages 21582440211, November.
    8. Patchara Phochanikorn & Chunqiao Tan, 2019. "A New Extension to a Multi-Criteria Decision-Making Model for Sustainable Supplier Selection under an Intuitionistic Fuzzy Environment," Sustainability, MDPI, vol. 11(19), pages 1-24, September.
    9. Amir Hossein Salimi & Amir Noori & Hossein Bonakdari & Jafar Masoompour Samakosh & Ehsan Sharifi & Mohammadreza Hassanvand & Baharam Gharabaghi & Mehdi Agharazi, 2020. "Exploring the Role of Advertising Types on Improving the Water Consumption Behavior: An Application of Integrated Fuzzy AHP and Fuzzy VIKOR Method," Sustainability, MDPI, vol. 12(3), pages 1-33, February.
    10. Morteza Yazdani & Dragan Pamucar & Prasenjit Chatterjee & Ali Ebadi Torkayesh, 2022. "“A multi-tier sustainable food supplier selection model under uncertainty”," Operations Management Research, Springer, vol. 15(1), pages 116-145, June.
    11. Yazdi, Amir Karbassi & Wanke, Peter Fernandes & Hanne, Thomas & Abdi, Farshid & Sarfaraz, Amir Homayoun, 2022. "Supplier selection in the oil & gas industry: A comprehensive approach for Multi-Criteria Decision Analysis," Socio-Economic Planning Sciences, Elsevier, vol. 79(C).
    12. Wu, Yunna & Ke, Yiming & Xu, Chuanbo & Li, Lingwenying, 2019. "An integrated decision-making model for sustainable photovoltaic module supplier selection based on combined weight and cumulative prospect theory," Energy, Elsevier, vol. 181(C), pages 1235-1251.
    13. Pasura Aungkulanon & Walailak Atthirawong & Pongchanun Luangpaiboon & Wirachchaya Chanpuypetch, 2024. "Navigating Supply Chain Resilience: A Hybrid Approach to Agri-Food Supplier Selection," Mathematics, MDPI, vol. 12(10), pages 1-42, May.
    14. Mohit Jain & Gunjan Soni & Deepak Verma & Rajendra Baraiya & Bharti Ramtiyal, 2023. "Selection of Technology Acceptance Model for Adoption of Industry 4.0 Technologies in Agri-Fresh Supply Chain," Sustainability, MDPI, vol. 15(6), pages 1-20, March.
    15. Davis-Sramek, Beth & Robinson, Jessica L. & Darby, Jessica L. & Thomas, Rodney W., 2020. "Exploring the differential roles of environmental and social sustainability in carrier selection decisions," International Journal of Production Economics, Elsevier, vol. 227(C).
    16. Lupo, Toni, 2015. "Fuzzy ServPerf model combined with ELECTRE III to comparatively evaluate service quality of international airports in Sicily," Journal of Air Transport Management, Elsevier, vol. 42(C), pages 249-259.
    17. Amin Mahmoudi & Saad Ahmed Javed, 2022. "Probabilistic Approach to Multi-Stage Supplier Evaluation: Confidence Level Measurement in Ordinal Priority Approach," Group Decision and Negotiation, Springer, vol. 31(5), pages 1051-1096, October.
    18. Pratibha Rani & Arunodaya Raj Mishra & Abbas Mardani & Fausto Cavallaro & Dalia Štreimikienė & Syed Abdul Rehman Khan, 2020. "Pythagorean Fuzzy SWARA–VIKOR Framework for Performance Evaluation of Solar Panel Selection," Sustainability, MDPI, vol. 12(10), pages 1-18, May.
    19. Alexei Pérez-Velázquez & Leandro Leysdian Oro-Carralero & Jorge Laureano Moya-Rodríguez, 2020. "Supplier Selection for Photovoltaic Module Installation Utilizing Fuzzy Inference and the VIKOR Method: A Green Approach," Sustainability, MDPI, vol. 12(6), pages 1-19, March.
    20. Aleksandar Aleksić & Danijela Tadić, 2023. "Industrial and Management Applications of Type-2 Multi-Attribute Decision-Making Techniques Extended with Type-2 Fuzzy Sets from 2013 to 2022," Mathematics, MDPI, vol. 11(10), pages 1-24, May.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:11:y:2019:i:7:p:1872-:d:217971. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.