Efficient methods for comparing two process yields – strategies on supplier selection

Abstract

Selecting an appropriate supplier can substantially reduce purchasing costs, decrease production lead time, increase customer satisfaction, and strengthen corporate competitiveness. Thus, an effective approach to alleviate the problem of supplier selection is essential. Numerous studies have indicated that quality is the most critical and fundamental factor for supplier selection and evaluation, among various criteria. This study provides several methods for selecting the superior supplier based on the commonly used quality criterion, process yield. Four tests for comparing two yield-measure indices, based on the normal approximation and generalised confidence intervals method, are presented and compared. This paper provides recommendations for selecting efficient methods, based on the simulation results of test size and selection power. An example is also presented to illustrate the applicability of these methods.

Keywords:

• difference
• ratio
• generalised confidence interval
• process yield
• supplier selection