International Journal of Computational Intelligence Systems

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International Journal of Computational Intelligence
Systems
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An Integrated Methodology using Linguistic
PROMETHEE and Maximum Deviation Method for
Third-party Logistics Supplier Selection
Chen-Tung Chen
a

b

c
, Ping-Feng Pai
a

b

c
& Wei-Zhan Hung
a

b

c
a
Department of Information Management, National United University, Miao-Li, Taiwan E-
mail:
b
Department of Information Management, National Chi Nan University, Nan-Tou, Taiwan
E-mail:
c
Department of International Business Studies, National Chi Nan University, Nan-Tou,
Taiwan E-mail:
Version of record first published: 12 Mar 2012.
To cite this article: Chen-Tung Chen , Ping-Feng Pai & Wei-Zhan Hung (2010): An Integrated Methodology using Linguistic
PROMETHEE and Maximum Deviation Method for Third-party Logistics Supplier Selection, International Journal of
Computational Intelligence Systems, 3:4, 438-451
To link to this article: http://dx.doi.org/10.1080/18756891.2010.9727712
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An Integrated Methodology using Linguistic PROMETHEE and Maximum Deviation Method for
Third-party Logistics Supplier Selection

Chen-Tung Chen, Ping-Feng Pai, Wei-Zhan Hung
Department of Information Management, National United University, Miao-Li, Taiwan
E-mail:ctchen@nuu.edu.tw
Department of Information Management, National Chi Nan University, Nan-Tou, Taiwan
paipf@ncnu.edu.tw
Department of International Business Studies, National Chi Nan University, Nan-Tou, Taiwan
steady_2006@hotmail.com

Abstract
The purpose of this paper is to present a framework and a suitable method for selecting the best logistics supplier. In
general, many quantitative and qualitative criteria should be considered simultaneously for making the decision of
logistics supplier selection. The information about judging the performance of logistics suppliers will come from
customers opinions, experts opinions and the operational data in the real environment. Under this situation, the
selection problem of logistic suppliers will be the uncertainties and fuzziness problems in the decision making process.
Therefore, we combined the linguistic PROMETHEE method with maximum deviation method to determine the
ranking order of logistics suppliers. And then, an example is implemented to demonstrate the practicability of the
proposed method. Finally, some conclusions are discussed at the end of this paper.

Keywords: Linguistic PROMETHEE, Maximum deviation method, Multi-criteria decision making, Logistic suppliers.


1. Introduction

In the global environment, the degree of the competition
among companies becomes more and more intensive. The
characteristics of competitive environment are such as
thin profit margins, high consumer expectations for
quality products, shorter life cycles, shorter lead-times,
faster dissemination and proliferation of information
1
. So,
companies are forced to take advantage of any
opportunity to optimize their business processes.
Companies have understood that they must focus on their
core competence. In order to increase the competitiveness,
they outsourced some of their non-core activities to other
companies that have made these particular activities into
their core competence
2-3
. Logistics services are one of
business activities can be outsourced. The main advantage
of outsourcing services is that the third-party logistics
(3PLs) allow companies to get into a new business, a new
market, or a reverse logistics program without
interrupting forward flows; in addition, logistics costs can
be greatly reduced
4-6
. However, the behavior of third-
party logistics supplier will indirectly affect the quality of
product and influence image of the company. Therefore,
selecting the suitable third-party logistics supplier is
important issue for each company.
In order to choose the suitable supplier, some methods
are presented for the logistics supplier selection such as
analytic hierarchy process(AHP)
7-8
, analytic network
process (ANP)
9-10
, fuzzy Technique for Order Preference
by Similarity to Ideal Solution (fuzzy TOPSIS)
approach
11
, scoring method and fuzzy expert system
12
,
data envelopment analysis (DEA)
13-14
, Linear
programming (LP)
15-16
, Integer linear programming
17-18
,
Multi-objective programming
19-20
, Genetic algorithm
(GA)
21
, hybrid decision support system
22
, principal
component analysis (PCA) and factor analysis (FA)
23
.
Many factors will influence the decision-making of
third-party logistics suppliers selection. In the past, many
literatures proposed various model to deal with the
selection problem of logistics suppliers. Cao et al.
1

presented a two-stage method based on Borda function
theory (BF) and Gray Rational Analysis (GRA) for
International Journal of Computational Intelligence Systems, Vol.3, No. 4 (October, 2010), 438-451
Published by Atlantis Press
Copyright: the authors
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Received: 14-01-2010; Accepted: 25-05-2010
logistic outsourcing decision-making. In their study, they
considered ten factors to select the suitable logistics
suppliers. Kannan et al.
4
put forward a hybrid method by
combining Interpretive Structural Modeling (ISM) with
fuzzy TOPSIS for the selection of third-party reverse
logistics provider (3PRLP). They considered seven
influence factors to evaluate and select among 15 reverse
logistics providers. Chan et al.
8
identified 15 important
decision criteria including cost, quality, service
performance and suppliers profile such as the risk factors
involved in the selection of global supplier in the current
business scenario and apply fuzzy extended analytic
hierarchy process (FEAHP) to evaluate the global
suppliers. Chen et al.
11
presented a fuzzy approach to deal
with the problem of supplier evaluation and selection in
supply chain management. In their paper, five major
factors are used to select the suitable supplier. Boran et
al.
24
utilized intuitionistic fuzzy weighted averaging
(IFWA) operator to aggregate individual opinions of
decision makers for rating the importance of criteria and
alternatives. They presented a group decision making
method based on TOPSIS by using intuitionistic fuzzy set
to deal with supplier evaluation problem. There are four
major criteria are considered for supplier selection such as
price, on-time delivers, relationship closeness and product
quality. Jharkharia et al.
25
considered hierarchy structure
of criteria and used analytic network process (ANP) to
select logistics service provider. Wang et al.
26
used fuzzy
hierarchical TOPSIS for supplier selection. There are five
factors are considered in their study. Yin et al.
27

presented a decision model based on grey situation and
information entropy for third-party logistics suppliers
selection. Information entropy indicator is applied to
determine the objective weight, and grey situation
decision is used to choose the best supplier. Ten
influenced factors are considered in this proposed model.
Tang
28
considered 5 main criteria including objective
logistics capacity, service quality, management efficiency
level, development potential and price advantage. He
presented a support vector machine (SVM) method for
assessment of the capacity logistics supplier. Some
criteria are collected from the past literatures and shown
in Table 1. According to the Table 1, six criteria are
usually used to select the suitable third-party logistics
suppliers such as price, service quality, on-time deliveries,
relationship closeness, financial structure, information
technology.
A few of supplier selection literatures deal with
conflicting criteria which exist in logistics supplier
selection problem. For example, high-level logistics
services mean high service price. Service quality and
outsource cost are conflicting criteria and we must make a
trade-off between them.
The 2-tuple linguistic representation model is based
on the concept of symbolic translation
29-30
. Decision
makers can apply 2-tuple linguistic variables to express
their subjective opinions and obtain the final evaluation
result with appropriate linguistic variable. It is an
effective method to reduce the mistakes of information
translation and avoid information loss through computing
with words
31
.
PROMETHEE (Preference Ranking Organization
Method for Enrichment Evaluation) is a multi-criteria
decision making method developed by Brans
32
. It is well
adapted to problems where a finite number of alternative
actions are to be ranked considering several, sometimes
conflicting, criteria
33
. There are six basic types of
preference function in PROMETHEE method, so experts
can select suitable function flexibly according to the
requirement of competition condition in the same industry
with respect to each criterion by PROMETHEE method
34
.
The maximizing deviation method is proposed by
Wang
35
to compute the weight of each criterion in
multiple attribute decision making (MADM) problems
with numerical information. If some criterion makes the
performance values among all the alternatives have
obvious differences, such a criterion plays a more
important role in choosing the best alternative. The
distinguish ability and objectivity of the maximizing
deviation method is better than AHP which is based on
subjective opinions of experts
36
.
In this paper, qualitative and quantitative criteria are
considered simultaneously for selecting the suitable
logistics supplier. We use 2-tuple linguistic valuable to
express experts and customers subjective opinions and
collect crisp value about the performance of logistics
supplier respect to quantitative criteria. In order to
compare and calculate rationally, all of the quantitative
and qualitative information will transfer to the same level
of 2-tuple linguistic valuable. And then, a new linguistic
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decision-making is presented by combining linguistic
PROMETHEE with maximum deviation method to
determine the ranking order of logistic suppliers.
This paper is organized as follows. In section 2, we
collected the criteria of logistics supplier selection from
the past literatures. In section 3, we presented the context
of the 2-tuple linguistic variable. In section 4, we
discussed the concept and formula of the maximizing
deviation method. In section 5, we described the detail of
the proposed method, and then an example is
implemented to demonstrate the procedure for the
proposed method at the section 6. Finally, conclusions are
discussed at the end of this paper.

2. The 2-Tuple Linguistic Representation

2.1 The fuzzy set and triangular fuzzy number

The fuzzy set theory is first introduced by Zadeh in
1965
37
. The fuzzy set theory is a very feasible method to
handle the imprecise and uncertain information in a real
world
38
. Especially, it is more suitable for subjective
judgment and qualitative assessment in the evaluation
processes of decision making than other classical
evaluation methods applying crisp values
39-40
.
A positive triangular fuzzy number (PTFN) T
~
can be
defined as ( ) u m l T , ,
~
= , where u m l s s and 0 > l ,
shown in Fig.1. The membership function ) ( ~ x
T
of
positive triangular fuzzy number (PTFN) T
~
is defined
as
41

( )

< <

< <

=
otherwise
u x m
m u
x u
m x l
l m
l x
x
T
, 0
,
,
~

(1)


0
1
l m u
) ( ~ x
T


Fig. 1. Triangular fuzzy number T
~
.

A linguistic variable is a variable whose values are
expressed in linguistic terms. In other words, variable
whose values are not numbers but words or sentences in a
nature or artificial language
42-43
. For example, quality is
a linguistic variable whose values are very low, low,
medium, high, very high, etc. These linguistic values can
also be represented by fuzzy numbers. There are two
advantages for using triangular fuzzy number to express
linguistic variable
44
. First, it is a rational and simple
method to use triangular fuzzy number to express
customers opinions. Second, it is easy to do fuzzy
arithmetic when using triangular fuzzy number to express
the linguistic variable. It is suitable to represent the degree
of subjective judgment in qualitative aspect than crisp
value.

2.2 The 2-tuple linguistic variable
Let } ,..., , , {
2 1 0 g
s s s s S = be a finite and totally
ordered linguistic term set. The number of linguistic term
is g+1 in set S. A 2-tuple linguistic variable can be
expressed as ) , (
a a
s o , where
a
s is the a-th linguistic
term in S and
a
o is a numerical value representing the
difference between calculated linguistic term and the
closest index label in the initial linguistic term set. The
concept of symbolic translation function is presented to
translate crisp value into a 2-tuple linguistic variable
45
.
The generalized translation function can be represented
as
46

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)
2
1
,
2
1
[ ] 1 , 0 [ :
g g
S A
(2)
) , ( ) (
a a
s o | = A
(3)
Where e [0, 1],
) ( g round a = |
,
g
a
a
= | o
, and
)
2
1
,
2
1
[
g g
a
e o
.
A reverse function
1
A
is defined to return an
equivalent numerical value from 2-tuple linguistic
information
) , (
a a
s o
. According to the symbolic
translation, an equivalent numerical value is obtained as
follow
46
.
| o o = + = A

a a a
g
a
s ) , (
1

(4)
Let x = {(r
1
, o
1
), (r
2
, o
2
),, (r
n
, o
n
)} be a 2-tuple
linguistic variable set. The arithmetic mean X is
computed as
47

) , ( ) , (
1
1
1
m m
n
a
a a
s r
n
X o o =
|
|
.
|

\
|
A A =
=


(5)
where n is the amount of 2-tuple linguistic variable. The
) , (
m m
s o is a 2-tuple linguistic variable which is
represented as the arithmetic mean.
In general, decision makers would use the different 2-
tuple linguistic variables based on their knowledge or
experiences to express their opinions
48
. For example, the
different linguistic variables show as Table 2 and Figs. 2-
4. Each 2-tuple linguistic variable can be represented as a
triangle fuzzy number. A transformation function is
needed to transfer these 2-tuple linguistic variables from
different linguistic sets to a standard linguistic set at
unique domain. In the method of Herrera and Martinez
45
,
the domain of the linguistic variables will increase as the
number of linguistic variable is increased. To overcome
this drawback, a new translation function is applied to
transfer a crisp number or 2-tuple linguistic variable to a
standard linguistic term at the unique domain
46
. Suppose
that the interval [0, 1] is the unique domain. The linguistic
variable sets with different semantics (or types) will be
defined by partitioning the interval [0, 1]. Transforming a
crisp number (e [0, 1]) into a-th linguistic term
) , (
) ( ) ( t n
a
t n
a
s o of type t as
) , ( ) (
) ( ) ( t n
a
t n
a t
s o | = A (6)
where
) (
t
g round a = |
,
t
t n
a
g
a
= | o
) (
,
1 ) ( = t n g
t
.
n(t) is the number of linguistic variable of type t.
Transforming a-th linguistic term of type t into a crisp
number (e [0, 1]) as
| o o = + = A
) ( ) ( ) ( 1
) , (
t n
a
t
t n
a
t n
a t
g
a
s
(7)
where 1 ) ( = t n g
t
and )
2
1
,
2
1
[
) (
t t
t n
a
g g
e o .
Therefore, the transformation from a-th linguistic term
) , (
) ( ) ( t n
a
t n
a
s o of type t to k-th linguistic term
) , (
) 1 ( ) 1 ( + + t n
k
t n
k
s o of type t+1 at interval [0, 1] can be
expressed as
) , ( )) , ( (
) 1 ( ) 1 ( ) ( ) ( 1
1
+ +
+
= A A
t n
k
t n
k
t n
a
t n
a t t
s s o o (8)


3. The Maximum Deviation Method

If the performance values among all the logistics suppliers
are little differences with respect to criterion, it shows that
the criterion plays a less important role in the decision-
making procedure. Contrariwise, if one criterion makes
the performance values among all the logistics suppliers
have obvious differences, such a criterion plays a more
important role in choosing the best logistics supplier.
According to the concept, the maximizing deviation
method
49
is applied to calculate the weight of each
criterion.
Assume that an expert group has K experts, and the
fuzzy rating of logistics supplier
i
A respect to criterion
j
C of each expert
k
E (k = 1,2,...,K) can be represented as
a 2-tuple linguistic variable ( )
k
ij
k
ij
k
ij
S x o ,
~
= . The deviation
method is used to compute the differences of the
performance values of each logistics suppliers with
respect to all criteria. For the expert
k
E and the
criterion
j
C , the deviation of logistics suppliers
i
A to all
the other logistics suppliers can be defined as
( ) ( ) ( ) ( ) A A =
=

n
l
j
k
lj
k
ij
k
ij
w x x w H
1
2
1 1 ~ ~

(9)
and
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( ) ( ) ( ) ( ) A A =
= =

n
i
n
l
j
k
lj
k
ij
k
j
w x x w H
1 1
2
1 1 ~ ~

(10)
The ( ) w H
k
ij
represents the deviation value of i-th supplier
to other logistics suppliers with respect to the criterion
j
C by the expert
k
E . The ( ) w H
k
j
represents the
deviation value of all logistics suppliers to other logistics
suppliers with respect to the criterion
j
C by the
expert
k
E . The
j
w represents the weight value of j-th
criterion. Based on the maximum deviation method, a
non-linear programming model can be constructed as
50

( ) ( ) ( ) ( )
= >
A A =
=
= = = =

m
j
j j
K
k
m
j
n
i
n
l
j
k
lj
k
ij k
w w t s
w x x w H
1
2
1 1 1 1
2
1 1
1 , 0 . .
~ ~
max

(11)
where
k
represents the weight of expert
k
E . According
to the computation process of maximizing deviation
method
49
, the weight of criterion
j
C can be calculated
as
49

( ) ( ) ( )
( ) ( ) ( ) A A
A A
=
= = =

=
= =

=
m
j
n
i
n
l
k
lj
k
ij
K
k
k
n
i
n
l
k
lj
k
ij
K
k
k
j
x x
x x
w
1 1 1
2
1 1
1
1 1
2
1 1
1 *
~ ~
~ ~


(12)


4. Proposed Method

In fact, selection problem of logistics suppliers can be
described by means of the following sets:
(i) A set of experts is called
{ }
K
E E , , E , E
2 1
=
;
(ii) A set of logistics suppliers (alternatives) is
called
{ }
m
A , , A , A A
2 1
=
;
(iii) A set of criteria
{ }
n
C , , C , C C
2 1
=
with which
performances are measured of logistics suppliers;
(iv) A set of performance ratings of logistics suppliers
with respect to criteria is called
ij
x , m i ,..., 2 , 1 =
n j ,..., 2 , 1 = .
If the performance of the i-th logistics supplier with
respect to the j-th criterion is quantitative information, it
can be expressed as crisp value (
ij
CV ). If the
performance of the i-th logistics supplier with respect to
the j-th criterion is qualitative information, the
performance of the i-th logistics supplier with respect to
the j-th criterion decided by the k-th expert can be
represented as a 2-tuple linguistic variable
( ) ) , (
k
ij
k
ij i
k
j
s A F o = . Experts would use the different 2-
tuple linguistic variables based on their knowledge or
experiences to express their opinions. It is needed to
transfer these 2-tuple linguistic variables from different
linguistic sets to a standard linguistic set at unique domain
before aggregated these linguistic variables of experts'
opinions.
If the experts' opinions have been transferred to a
standard linguistic set at unique domain, the aggregated
linguistic ratings ( )
i j
A F of the i-th logistics supplier with
respect to the j-th criterion can be calculated as
( ) ) , ( )) , (
1
(
1
1
ij ij
k
ij
K
k
k
ij i j
s s
K
A F o o = A A =

=


(13)
We can transfer crisp value which belong to benefit
criterion into linguistic ratings ( )
i j
A F as
( ) ( )
i j ij ij
ij
i
ij
i
ij
i
ij
A F s
CV CV
CV CV
= = A =

A ) , ( )
min max
min
( o | .
Likewise, we can transfer crisp value which belong to
cost criterion into linguistic ratings ( )
i j
A F as
( ) ( )
i j ij ij
ij
i
ij
i
ij
i
ij
A F s
CV CV
CV CV
= = A =

A ) , ( )
min max
min
1 ( o | Fo
r comparing two logistics suppliers A A A
s r
e , , under
criterion j, the difference can be calculated as
( ) ( ) ( ) ( )
s j r j
A F A F d
1 1
A A =
. Therefore, a preference
function P is defined as:
( ) ( ) ( ) ( )
s j r j j
rs
j j s r j
A F A F H d H A A P , ) ( , = =

(14)
( ) 1 , 0 s s
s r j
A A P

The symbol
( )
s r j
A A P ,
represents the preference
degree of logistics supplier
r
A over
s
A with respect to
criterion j. The ) ( H
j
rs
j
d is a monotonically increasing
function of the observed deviation between
( )
r j
A F
and
( )
s j
A F
with respect to criterion j.
There are six types of preference function in
PROMETHEE method
32-34
such as usual criterion, quasi
criterion, criterion with linear preference, level criterion
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with linear preference, criterion with linear preference
and indifference area, and guassian criterion.
Usual criterion can be expressed as follows
( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )

s A A
> A A
=


0 , 0
0 , 1
,
1 1
1 1
s j r j
s j r j
s j r j
A F A F
A F A F
A F A F H

(15)
Quasi criterion can be expressed as follows
( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )

s A A
> A A
=


l A F A F
l A F A F
A F A F H
s j r j
s j r j
s j r j
1 1
1 1
, 0
, 1
,

(16)

Criterion with linear preference can be expressed as
follows
( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )

A A >
> A A >
A A
> A A
=




s j r j
s j r j
s j r j
s j r j
s j r j
A F A F
A F A F p
p
A F A F
p A F A F
A F A F H
1 1
1 1
1 1
1 1
0 , 0
0 ,
, 1
,

(17)

Level criterion with linear preference can be expressed as
follows
( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )

A A >
> A A >
> A A
=



s j r j
s j r j
s j r j
s j r j
A F A F q
q A F A F p
p A F A F
A F A F H
1 1
1 1
1 1
, 0
,
2
1
, 1
,

(18)
Criterion with linear preference and indifference area can
be expressed as follows
( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )

A A >
> A A >

A A
> A A
=




s j r j
s j r j
s j r j
s j r j
s j r j
A F A F q
q A F A F p
q p
q A F A F
p A F A F
A F A F H
1 1
1 1
1 1
1 1
, 0
,
, 1
,

(19)
Guassian criterion can be expressed as follows
( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )
( ) ( ) ( ) ( )

s A A
> A A
=


|
.
|

\
|
A

A
0 , 0
0 , 1
,
1 1
1 1
2
2
2
1 1
s j r j
s j r j
s
A
j
F
r
A
j
F
s j r j
A F A F
A F A F e
A F A F H
o

(20)
The overall preference index of logistics supplier
r
A
over
logistics supplier
s
A
can be represented as
( ) ( )

=
=
n
j
rs
j j j s r
d H w A A
1
*
* , t

(21)
where
*
j
w is the weight of criterion
j
C is determined by
maximum deviation method.
The leaving flow of
r
A can be calculated as
( ) ( )

=
e
+
=
r
A b
A b
r r
b A A , t |

(22)
( )
r
A
+
| is the measure of the dominating degree of
r
A
over the other logistics suppliers .
The entering flow of
r
A can be calculated as
( ) ( )

=
e

=
r
A b
A b
r r
A b A , t |

(23)
( )
r
A

| is the measure of the dominated degree of


r
A by
the other logistics suppliers.
The net flow of
r
A can be calculated as
( ) ( ) ( )
r r r
A A A
+
= | | | (24)
Define the outranking index of logistics supplier
r
A as:
( )
( )
2
1
1
+

=
n
A
A OTI
r
r
|

(25)
where n is the number of logistics supplier. The range of
OTI is between 0 and 1, the higher the value of OTI, the
better the logistics supplier. However, a more realistic
approach may be to use a linguistic variable to describe
the current assessment status of each logistics supplier in
accordance with its outranking index. Therefore,
transform the outranking index of each logistics supplier
into 2-tuple linguistic variable as ( ) ( ) ) , (
r r r
s A OTI o = A .
According to the 2-tuple linguistic outranking index of
each logistics supplier, one can determine the ranking
order and the current assessment status of each logistics
supplier by using a 2-tuple linguistic variable.

5. A Numerical Example

Suppose that a furniture factory desires to select a
logistics supplier to deliver their product to his customer.
In the enterprise, enterprise manager wants to choose the
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best logistics suppliers from four candidates in
accordance with six criteria. These criteria are price, on-
time deliveries, service quality, financial structure,
relationship closeness, and information technology.
The price, financial structure and on-time deliveries
are quantitative information. Price can be represented by
the advantage expense which furniture factory must pay
when supplier delivered furniture to one customer. On-
time delivery represents the ratio of logistics supplier
deliver product to customers in the customers appointed
time. We can collect from the customers response
opinion and arrange the ratio of delivery delay. Service
quality which is the degree of customers satisfactory, we
can collect from the customers by questionnaires.
Financial structure means the risk of a company will go
out of business. Relationship closeness means the
relationship between enterprise and logistics supplier.
Information technology means the information system
which logistics supplier provides to customer. Financial
structure, relationship closeness and information
technology can be expressed by experts opinions
according to suitable level of linguistic variables. The
description about the criteria is shown in Table 3.
According to the proposed method, the computational
procedures of the problem are summarized as follows.
Step 1. Collect the quantity information as Table 4.
Step 2. Transform the quantity information into 2-tuple
linguistic variable of level 2 as Table 5.
Step 3. The information about service quality respect to
each logistics supplier is collected from three customers
opinions as Table 6. Each customer chooses suitable level
of linguistic variables according to his/her preference to
express his/her opinion about the service quality of each
supplier.
Step 4. Transform customers opinions about service
quality of each logistics supplier into 2-tuple linguistic
variable of type 2 and then aggregate the linguistic
ratings of each logistics supplier as Table 7.
Step 5. Each expert chooses the suitable level of linguistic
variables. Expert
1
D chooses level 1,
2
D chooses level
2,
3
D and chooses level 3 (refer to Table 2). And then,
each expert uses the linguistic variables evaluate the
performance ratings of each logistics supplier with respect
to financial structure criterion, relationship closeness
criterion and information technology criterion as Table 8.
Step 6. Transform experts opinions into 2-tuple
linguistic variable of level 2 and then aggregate the
linguistic ratings of each logistics supplier with respect to
criteria as Table 9.
Step 7. Determine the threshold values of each criterion
as Table 10.
Step 8. Calculate the preference degree H(d) of all
logistics suppliers with respect to each criterion as Tables
11-16 and the preference function of each criterion please
refers to Table 3.
Step 9. In this paper, the importance of each expert is
equally. Thus,
3
1
3 2 1
= = = . We computed the
weight of each criterion by maximize deviation method
(equation 12) in accordance with each experts opinion
which is about the performance of each logistics supplier
with respect to each criterion as.
299 . 0
*
1
= w , 294 . 0
*
2
= w , 104 . 0
*
3
= w , 081 . 0
*
4
= w ,
115 . 0
*
5
= w , 108 . 0
*
6
= w .
Step 10. Calculate the overall preference index of each
logistics supplier as Table 17.
Step 11. Calculate the leaving flow, the entering flow, the
net flow, the outranking index and linguistic variable at
level 1 of each logistics supplier as Table 18. Finally, the
ranking order of all logistics suppliers according to the
outranking index is
4 2 3 1
} { A A A A > > > .
According to the linguistic variable, logistics suppliers
1
A ,
2
A and
3
A are in the same level and can be expressed
as fair suppliers. But,
1
A is slightly superior than
2
A and
3
A . Logistics supplier
4
A can be expressed as a
poor supplier.

6. Conclusions

In this paper, we developed a framework for selecting
logistics suppliers which both considers quantitative and
qualitative criteria. The information about judging the
performance of logistics supplier comes from customers
opinions, experts opinions and the realistic data such as
advantage expense per logistics service activity, ratio of
correct delivery on time. So, we considered many
dimensions which are suitable for selecting the logistics
supplier in realistic environment. Considering the
conflicting criteria such as service quality and outsource
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cost exists in choosing the best logistics supplier and
avoiding the subjective judgment of experts, we presented
a MCDM method by combining linguistic PROMETHEE
with maximum deviation method for determining the
ranking order and the level of logistics suppliers. In the
future, we will develop a decision support system based
on the framework and enhance the practical value of the
proposed method.

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1617.











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Table 1. The collected criteria from the literatures
Cao
et al.
1

Kannan
et al.
4

Chan
et al.
8

Chen
et al.
11

Boran
et al.
24

Jharkharia
et al.
25

Wang
et al.
26

Yin
et al.
27

Tang
28


Price
Financial Structure
Market Share
On-time Deliveries
Service Quality
Value-Added
Services
KPI (Key
Performance
Indicator)
Measurement

Reputation
Reject Rate
Technical
Capability

Inability to meet
future requirement

Willingness and
Attitude

Relationship
closeness

Conflict Resolution
Lead Time
Technological and
R&D support

Response to
Changes

Communication
Performance
History

Production Facility
and Capacity

Political Stability
Economy
Terrorism
Product Quality
Compatibility
Risk Management
Flexibility
Key Quality
Characteristics

Information
Technology

Location
Global capability
Scope of enterprise
Innovation
capability

Credibility and
culture

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Risk degree of
cooperation

Impact on
environment

Transportation
capacity

Storage capacity
Organization
learning ability


Table 2. Different levels of linguistic variables
Levels Linguistic variables Figure
1
Extremely Poor ) (
5
0
s , Poor ) (
5
1
s , Fair ) (
5
2
s , Good ) (
5
3
s , Extremely Good ) (
5
4
s
Fig 2.
2
Extremely Poor ) (
7
0
s , Poor ) (
7
1
s , Medium Poor ) (
7
2
s , Fair ) (
7
3
s , Medium Good ) (
7
4
s , Good ) (
7
5
s ,
Extremely Good ) (
7
6
s
Fig 3.
3
Extremely Poor ) (
9
0
s ,Very Poor ) (
9
1
s , Poor ) (
9
2
s , Medium Poor ) (
9
3
s , Fair ) (
9
4
s , Medium
Good ) (
9
5
s , Good ) (
9
6
s , Very Good ) (
9
7
s , Extremely Good ) (
9
8
s
Fig 4.











Fig. 2. Membership functions of linguistic variables at level 1 (t=1)










Fig. 3. Membership functions of linguistic variables at level 2 (t=2)










Fig. 4. Membership functions of linguistic variables at level 3 (t=3)
1 0
) (
7
0
s

) (
7
1
s

) (
7
2
s

) (
7
3
s

) (
7
4
s

) (
7
5
s

) (
7
6
s
0 1
) (
5
0
s ) (
5
1
s ) (
5
2
s ) (
5
3
s ) (
5
4
s
0 1
1
) (
9
0
s ) (
9
1
s ) (
9
2
s ) (
9
3
s ) (
9
4
s ) (
9
5
s ) (
9
6
s ) (
9
7
s ) (
9
8
s
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Table 3. The Description of the criteria
Name Data type Information Preference function
1
C (Price)
Quantity
(Cost
Criterion)
Advantage expense per service Criterion with linear preference
and indifference area
2
C (On time Deliveries)
Quantity
(Cost
Criterion)
Ratio of delivery Delay Criterion with linear preference
3
C (Service Quality)
Quality The degree of customers satisfaction
Judged by customers
Level criterion with linear
preference
4
C (Financial Structure)
Quality the risk of a company will go out of
business.
Judged by experts
Criterion with linear preference
and indifference area
5
C (Relationship Closeness)
Quality Relationship between enterprise and
logistics supplier.
Judged by experts
Level criterion with linear
preference
6
C (Information Technology)
Quality the information system which logistics
supplier provides to customer
Judged by experts
Criterion with linear preference

Table 4. Quantitative information

1
A
2
A
3
A
4
A
1
C Price (U.S.
Dollar)
3 2.5 4 3.5
2
C
On time Deliveries
(Ratio of Delivery
Delay)
1.5% 3% 1% 2%

Table 5. Linguistic variable of quantitative information

1
A
2
A
3
A
4
A
1
C Price (U.S.
Dollar)
) 0 , (
7
4
s

) 0 , (
7
6
s

) 0 , (
7
0
s

) 0 , (
7
2
s

2
C
On time Deliveries
(Ratio of Delivery
Delay)
) 083 . 0 , (
7
5
s

) 0 , (
7
0
s

) 0 , (
7
6
s

) 0 , (
7
3
s



Table 6. Customers opinions about service quality

1
Cu
2
Cu
3
Cu
1
A ) 0 , (
5
2
s
) 0 , (
7
6
s

) 0 , (
9
6
s

2
A ) 0 , (
5
4
s

) 0 , (
7
5
s

) 0 , (
9
8
s

3
A ) 0 , (
5
3
s

) 0 , (
7
5
s

) 0 , (
9
8
s

4
A ) 0 , (
5
2
s

) 0 , (
7
2
s

) 0 , (
9
4
s



Table 7. Customers opinions represented and aggregated by the
linguistic variable of level 2

1
Cu
2
Cu
3
Cu
average
1
A ) 0 , (
7
3
s

) 0 , (
7
6
s

) 083 . 0 , (
7
5
s

) 083 . 0 , (
7
5
s

2
A ) 0 , (
7
6
s

) 0 , (
7
5
s
) 0 , (
7
6
s

) 056 . 0 , (
7
6
s

3
A ) 083 . 0 , (
7
5
s

) 0 , (
7
5
s
) 0 , (
7
6
s

) 028 . 0 , (
7
5
s

4
A ) 0 , (
7
3
s

) 0 , (
7
2
s

) 0 , (
7
3
s

) 056 . 0 , (
7
3
s


Table 8. The rating linguistic variable by experts
Criterion Logistics
supplier
D
1
D
2
D
3

1
A ) 0 , (
5
4
s

) 0 , (
7
5
s

) 0 , (
9
4
s

2
A ) 0 , (
5
3
s

) 0 , (
7
2
s

) 0 , (
9
8
s

3
A ) 0 , (
5
3
s

) 0 , (
7
3
s

) 0 , (
9
6
s

4
C
4
A
) 0 , (
5
2
s

) 0 , (
7
5
s

) 0 , (
9
5
s

1
A ) 0 , (
5
4
s

) 0 , (
7
6
s

) 0 , (
9
8
s

2
A ) 0 , (
5
3
s

) 0 , (
7
2
s

) 0 , (
9
8
s

3
A ) 0 , (
5
4
s

) 0 , (
7
5
s

) 0 , (
9
6
s

5
C
4
A ) 0 , (
5
4
s

) 0 , (
7
6
s

) 0 , (
9
8
s

1
A ) 0 , (
5
3
s

) 0 , (
7
2
s

) 0 , (
9
2
s

2
A ) 0 , (
5
2
s

) 0 , (
7
5
s

) 0 , (
9
4
s

3
A ) 0 , (
5
4
s

) 0 , (
7
5
s

) 0 , (
9
8
s

6
C
4
A ) 0 , (
5
2
s

) 0 , (
7
4
s

) 0 , (
9
4
s

Published by Atlantis Press
Copyright: the authors
449
D
o
w
n
l
o
a
d
e
d

b
y

[
T
a
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a
d
u

A
g
r
i
c
u
l
t
u
r
a
l

U
n
i
v
]

a
t

0
0
:
1
3

2
7

A
p
r
i
l

2
0
1
3

Table 9. Experts opinions represented and aggregated by the
linguistic variable of level 2
Criterion
Logistics
supplier
D
1
D
2

D
3

average
1
A ) 0 , (
7
6
s

) 0 , (
7
5
s
) 0 , (
7
3
s

) 056 . 0 , (
7
5
s

2
A
) 083 . 0 , (
7
5
s
) 0 , (
7
2
s

) 0 , (
7
6
s

) 028 . 0 , (
7
4
s

3
A
) 083 . 0 , (
7
5
s
) 0 , (
7
3
s

) 083 . 0 , (
7
5
s

) 083 . 0 , (
7
5
s

4
C
4
A ) 0 , (
7
3
s

) 0 , (
7
5
s

) 042 . 0 , (
7
4
s

) 014 . 0 , (
7
4
s

1
A ) 0 , (
7
6
s

) 0 , (
7
6
s

) 0 , (
7
6
s

) 0 , (
7
6
s

2
A ) 083 . 0 , (
7
5
s

) 0 , (
7
2
s

) 0 , (
7
6
s

) 029 . 0 , (
7
4
s

3
A ) 0 , (
7
6
s

) 0 , (
7
5
s

) 083 . 0 , (
7
5
s

) 028 . 0 , (
7
5
s

5
C
4
A ) 0 , (
7
6
s

) 0 , (
7
6
s

) 0 , (
7
6
s

) 0 , (
7
6
s

1
A ) 083 . 0 , (
7
5
s

) 0 , (
7
2
s

) 083 . 0 , (
7
2
s

) 056 . 0 , (
7
3
s

2
A ) 0 , (
7
3
s

) 0 , (
7
5
s

) 0 , (
7
3
s

) 056 . 0 , (
7
4
s

3
A ) 0 , (
7
6
s

) 0 , (
7
5
s

) 0 , (
7
6
s

) 056 . 0 , (
7
6
s

6
C
4
A ) 0 , (
7
3
s

) 0 , (
7
4
s

) 0 , (
7
3
s

) 056 . 0 , (
7
3
s



Table 10. The threshold values of each criterion

1
C
2
C
3
C
4
C
5
C
6
C
Thre
shol
d
12
1
6
1
=
=
q
p

6
1
= p

6
1
= p

12
1
6
1
=
=
q
p

6
1
= p

6
1
= p



Table 11. Preference degree with respect to criterion
1
C

1
A
2
A
3
A
4
A
1
A 0.000 0.000 1.000 1.000
2
A 1.000 0.000 1.000 1.000
3
A 0.000 0.000 0.000 0.000
4
A 0.000 0.000 1.000 0.000


Table 12. Preference degree with respect to criterion
2
C

1
A
2
A
3
A
4
A
1
A 0.000 1.000 0.000 1.000
2
A 0.000 0.000 0.000 0.000
3
A 1.000 1.000 0.000 1.000
4
A 0.000 1.000 0.000 0.000

Table 13. Preference degree with respect to criterion
3
C

1
A
2
A
3
A
4
A
1
A 0.000 0.000 0.000 1.000
2
A 1.000 0.000 0.500 1.000
3
A 0.500 0.000 0.000 1.000
4
A 0.000 0.000 0.000 0.000


Table 14. Preference degree with respect to criterion
4
C

1
A
2
A
3
A
4
A
1
A 0.000 0.000 0.333 0.500
2
A 0.000 0.000 0.000 0.000
3
A 0.000 0.000 0.000 0.000
4
A 0.000 0.000 0.000 0.000


Table 15. Preference degree with respect to criterion
5
C

1
A
2
A
3
A
4
A
1
A 0.000 1.000 0.500 0.000
2
A 0.000 0.000 0.000 0.000
3
A 0.000 0.500 0.000 0.000
4
A 0.000 1.000 0.500 0.000


Table 16. Preference degree with respect to criterion
6
C

1
A
2
A
3
A
4
A
1
A 0.000 0.000 0.000 0.000
2
A 0.000 0.000 0.000 0.000
3
A 1.000 0.333 0.000 0.556
4
A 0.000 0.000 0.000 0.000

Table 17. The overall preference index of each logistics supplier

1
A
2
A
3
A
4
A
1
A 0.000 0.409 0.383 0.737
2
A 0.510 0.000 0.351 0.402
3
A 0.454 0.460 0.000 0.506
4
A 0.036 0.409 0.356 0.000

Published by Atlantis Press
Copyright: the authors
450
D
o
w
n
l
o
a
d
e
d

b
y

[
T
a
m
i
l
n
a
d
u

A
g
r
i
c
u
l
t
u
r
a
l

U
n
i
v
]

a
t

0
0
:
1
3

2
7

A
p
r
i
l

2
0
1
3

Table 18. The final result of each logistics supplier

( )
r
A
+
|

( )
r
A

|

( )
r
A | ( )
r
A OTI
( )
i i
s o ,
5
1
A
1.529 1.000 0.529 0.588
) 088 . 0 , (
5
2
s

2
A
1.263 1.278 -0.015 0.498
) 002 . 0 , (
5
2
s

3
A
1.419 1.090 0.329 0.555
) 055 . 0 , (
5
2
s

4
A
0.801 1.645 -0.843 0.359
) 124 . 0 , (
5
1
s





Published by Atlantis Press
Copyright: the authors
451
D
o
w
n
l
o
a
d
e
d

b
y

[
T
a
m
i
l
n
a
d
u

A
g
r
i
c
u
l
t
u
r
a
l

U
n
i
v
]

a
t

0
0
:
1
3

2
7

A
p
r
i
l

2
0
1
3

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