An integrated model for solving the multiple criteria ABC inventory classification problem

Abstract

In this paper, we present an integrated version of the Ng model and Zhou and Fan model [W. L. Ng,<br />A simple classifier for multiple criteria ABC analysis, European Journal of Operation Research, 177<br />(2007) 344-353; P. Zhou & L. Fan, A note on multi-criteria ABC inventory classification using<br />weighted linear optimization, European Journal of Operation Research, 182 (2007) 1488-1491]. The<br />model that Ng [1] offered, hereafter called the Ng-model, in spite of its advantages may lead to a<br />situation in which the weights of some criteria in relation to an item would not play any role in<br />determining overall score that item. Also, the scale transformation that he applied for transforming the<br />measures of items under criteria into interval 0-1 is not suitable for the small-scale measures. On the<br />other hand, for the R inventory item, the Zhou and Fan model [2], hereafter called the ZF-model,<br />should be solved through a linear optimizer 2R times in which an inventory manager might has no any<br />background in regard with optimizer. Furthermore, when number of items is large, the computing<br />time would increase. Therefore, in order to remove drawbacks of both the approaches, an integrated<br />model is presented in which objective functions are the same ZF-method but its constraints is similar<br />to Ng model. At last, results obtained from applying the proposed model in an illustrative example are<br />compared with Ng and ZF-models.