Application of an integrated decision support process for supplier selection

In many firms the value of purchased materials and components accounts for 50–80% of total cost of goods sold. For those firms, purchasing decisions cause enterprise wide side effects, and, therefore, should be treated as an integration matter. Supplier selection is a problem that deals with both qualitative and quantitative issues that must be measured using information that is normally spread within the enterprise. To see how this problem was addressed in a small construction company in Brazil, an integrated procurement process, which is a simplification of a more complex methodology, is presented. The case study shows the importance of simpler, yet efficient, solutions to address the decision making problems of smaller enterprises in development countries—a research and commercial niche not well developed yet.