Kraljic Baru

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A novel strategy segmentation Strategy

segmentation
methodology integrating Kraljic matrix
portfolio matrix and supplier

relationship model: a case study
from machinery industry Received 30 March 2023
Revised 5 July 2023
17 August 2023
Ahmet Selcuk Yalcin Accepted 25 August 2023
Department of Industrial Engineering, Istanbul Okan University,
Istanbul, Turkey and
Department of Industrial Engineering, Istanbul Technical University,
Istanbul, Turkey
Huseyin Selcuk Kilic
Department of Industrial Engineering, Marmara University, Istanbul, Turkey, and
Emre Cevikcan
Department of Industrial Engineering, Istanbul Technical University,
Istanbul, Turkey
Abstract
Purpose – The purpose of this article is to develop a new model called strategy segmentation methodology
(SSM) by combining the Kraljic portfolio matrix (KPM) and the supplier relationship model (SRM) so that the
buyer company can effectively conduct its relations with its suppliers.
Design/methodology/approach – The importance weights of the criteria defining the dimensions of each
model are calculated with the single-valued neutrosophic analytical hierarchy process (SVN-AHP) method.
Subsequently, the derived importance weights are employed in the single-valued neutrosophic technique for
order preference by similarity to ideal solution (SVN-TOPSIS) method to obtain the scores of the suppliers and
their supplied items. In order to illustrate the feasibility of the proposed methodology, a case study in the
machinery industry is performed with the related comparative analysis.
Findings – The implementation of SSM enables to formulate various strategies to manage suppliers taking
into account the items they procure, their capabilities and performance and the supplier–buyer relationship
strength. Based on the proposed strategies, it is concluded that the firm in the case study should terminate its
relationship with six of its suppliers.
Originality/value – Although KPM has become the basis of purchasing strategies for various businesses, it
neglects the characteristics of suppliers and the buyer–supplier relationship. In this study, KPM is integrated
with the SRM approach presented by Olsen and Ellram (1997) to overcome these disadvantages of KPM. The
novel integration of the two approaches enables the realization of a robust and reliable supplier
classification model.
Keywords Supplier segmentation, Kraljic portfolio matrix, SVN-AHP, SVN-TOPSIS
Paper type Research paper
1. Introduction
Kraljic (1983) is one of the first researchers to develop the concept of supplier segmentation.
The seminal portfolio approach developed by Kraljic (1983), known as the Kraljic portfolio
model (KPM), is a considerable tool for defining supplier strategies over materials. In this model,
This research did not receive any specific grant from funding agencies in the public, commercial, or not-
Benchmarking: An International
for-profit sectors. Journal
Note: This article is produced from PhD dissertation of Ahmet Selcuk Yalcin in Istanbul Technical © Emerald Publishing Limited
1463-5771
University. As the requirement for PhD thesis submission, this point is critical. DOI 10.1108/BIJ-03-2023-0197
BIJ items are classified according to two dimensions: strategic impact and supply risk. While KPM
has considerably inspired academic research and impacted professional purchasing to date, it
has also drawn reasonable criticism (Padhi et al., 2012). In fact, the KPM was developed more
than thirty years ago, when the procurement function was still at the operational level, as
evidenced by the KPM’s focus on the supply, not the supplier. Both dimensions (supply risk and
strategic impact) are associated with materials/items (supply) (Rezaei and Lajimi, 2019).
As in Kraljic’s model, the evaluation of items alone may not be sufficient to manage
relationships with suppliers; the capabilities and performance of the suppliers and the buyer–
supplier relationship should also be taken into consideration (Rezaei and Lajimi, 2019). The
development of portfolio models that take into account both the items and the capabilities/
performance of suppliers and buyer–supplier relations is a topic largely overlooked by the
theoretical and empirical literature. We aim to fill this gap in the literature by proposing a
novel model called strategy segmentation methodology (SSM). In this methodology, we
integrated the KPM approach with the supplier relationship model (SRM) model, which takes
into account both suppliers’ capabilities/performance and buyer–supplier relations. The
proposed SSM approach takes into account not only the products provided by suppliers but
also their capabilities, performance and relationship with the buyer. However, with the
proposed SSM approach, purchasing managers can evaluate their suppliers much more
thoroughly and come up with more effective strategies for negotiating with them.
Determining the importance weights of the criteria in the dimensions of the KPM and SRM
models is an important issue that should be emphasized. In this context, the analytical hierarchy
process (AHP) method is a powerful method that is frequently used in determining the
importance weights of criteria in various research areas. However, it generally cannot cope with
vague and unstable information in the real world. Neutrosophic sets can effectively deal with
vague and inconsistent data in the decision-making process by considering all aspects of a
decision problem (i.e. truthiness, indeterminacy and falsehood) (Abdel-Basset et al., 2018). In this
context, in a neutrosophic setting, the AHP method can deal with inconsistent and ambiguous
information because it can consider all aspects of a decision problem.
Another important issue is to measure the scores of alternatives in the segmentation
models. Technique for order preference by similarity to ideal solution (TOPSIS) method
presents a scalar value that simultaneously describes both the best and worst alternatives;
thus, it can measure the relative performance of each alternative in a simple mathematical
form. However, not all criteria evaluating alternatives are always measurable; there can be
also linguistic criteria (Rouyendegh et al., 2020). It is difficult for the traditional TOPSIS
method to deal with linguistic criteria. The neutrosophic concept can be used with the
TOPSIS to provide the linguistic values that allow experts to incorporate unmeasured and
incomplete information into the decision model.
In this paper, first, we employed the single-valued neutrosophic AHP approach to obtain the
importance weights of the criteria. Afterward, the single-valued neutrosophic TOPSIS approach is
utilized to calculate the scores of items in the KPM and the scores of suppliers in the SRM. Thus,
product and supplier segments are identified in the KPM and SRM models, respectively. Finally, in
the SSM model, the positions of the suppliers are determined by considering the segments of items
in the KPM and the segments of suppliers in the SRM. Different strategies are also formulated to
manage segments of the strategy segmentation methodology (SSM) approach. A case study in the
machinery industry is conducted to demonstrate the applicability of the proposed methodology.
The main contributions of this paper to the literature can be listed as follows:
(1) A novel approach called strategy segmentation methodology (SSM) is developed by
integrating KPM and SRM.
(2) By integrating KPM and SRM, a novel approach called (SSM) is developed.
(3) Different strategies are designed to deal with different segments of SSM, taking into Strategy
account the procured items, the capabilities and performance of suppliers and the segmentation
buyer–supplier relationship.
matrix
(4) MCDM methods including AHP and TOPSIS are used synergistically in a
neutrosophic setting for the first time for the segmentation of the items and suppliers.
(5) A real case is performed in the machinery industry for the verification and elaborated
analysis of the proposed methodology.
(6) A comparative analysis with alternative techniques is provided.
The rest of this paper is organized as follows: Section 2 details and discusses the literature review.
Section 3 provides the steps of the proposed model. In Section 4, a real case implementation of the
proposed methodology is given. In Section 5, a comparative analysis of this paper is provided.
Finally, Section 6 presents the concluding remarks and recommendations for further studies.
2. Literature review
A purchasing portfolio model (PPM) can be defined as an analysis tool with a prescriptive
structure and the ability to identify different groups of materials. The main advantage of the
PPM implementation is that the strategic significance of the materials to be purchased can be
understood, thus allowing different actions to be taken for each supplier segment. The
presentation of Kraljic’s model can be regarded as a breakthrough for professional purchasing
(Medeiros and Ferreira, 2018). Kraljic’s model has become the dominant approach in the
literature and has formed the basis of purchasing strategies for many companies (Montgomery
et al., 2018).
Table 1 shows the quantitative studies by methods used, type of PPM proposed, supplier
characteristics and buyer–supplier relationship characteristics. Using Kraljic’s model, Park et al.
(2010) divided the strategic materials for the firm into three relationship groups: transactional,
collaborative and strategic. The authors used the AHP method to evaluate the products. Padhi
et al. (2012) proposed a portfolio model with a fuzzy MCDM method based on Kraljic’s model.
Using the Fuzzy TOPSIS approach and the KPM model, Medeiros and Ferreira (2018) segmented
the procurement of a hospital’s requirements. Drake et al. (2013) proposed a novel portfolio model
to categorize components as innovative or functional, thus specifying their suitability for agile or
lean procurement. They used the AHP method to place purchased components in their model. Lee
and Drake (2010) conducted a model on the basis of the KPM approach. To compute the
importance weights of the criteria, they used the AHP approach. Knight et al. (2014) explored the
relative significance of purchasing skills for different purchasing situations by considering the
KPM approach. The authors aimed to segment each purchase type, determine a set of
procurement skills and improve skill profiles for purchasing types. Using cluster analysis, they
identified three different types of purchasing strategies for the managers (i.e. strategic, tactical
and routine). Osiro et al. (2014) used the fuzzy inference system approach to identify the strengths
and weaknesses of existing suppliers, taking into account item classes in KPM. An illustrative
application was performed with the information collected from twenty suppliers of a firm
operating in the automobile sector. The authors stated that the company should maintain its
relationship with seven suppliers, and only one supplier should be replaced.
In the construction sector, Ferreira et al. (2015) investigated the implementation of the KPM
approach. They utilized the multidimensional scaling (MDS) technique and AHP approach to
precisely plot the structural elements in the KPM model. Lima-Junior and Carpinetti (2016) used
fuzzy TOPSIS to evaluate and categorize suppliers on cost and delivery performance
dimensions. Based on the actual context of a manufacturer in the automotive industry, an
implementation of the proposed model was performed. The performance of seventeen suppliers
BIJ Buyer–supplier
PPM Supplier characteristic relationship
Supplier Supplier Economic Relational
Author(s) KPM Other capability performance norms norms Approach
Olsen and Ellram 1 x x AHP

x
(1997)
Lee and Drake x AHP
(2010)
Park et al. (2010) x x1 x x AHP
Padhi et al. (2012) x Fuzzy multi-attribute
scoring
Ganguly and Guin x Fuzzy AHP
(2013)
Drake et al. (2013) x2 AHP
Arantes et al. x AHP and MDS
(2014)
Osiro et al. (2014) x x3 x x x Fuzzy inference
system
Knight et al. (2014) x Cluster analysis
Ferreira et al. x AHP and MDS
(2015)
Vlachakis et al. x Understand,
(2016) document, simplify,
optimize (UDSO)
methodology
Lima-Junior and x4 x Fuzzy TOPSIS
Carpinetti (2016)
Segura and Maroto x5 x AHP, MAUT and
(2017) PROMETHEE
Montgomery et al. x Multi-objective
(2018) decision analysis
Medeiros and x Fuzzy TOPSIS
Ferreira (2018)
Bianchini et al. x AHP
(2019)
Rezaei and Lajimi x x6 x x BWM
(2019)
Garzon et al. (2019) x Weight assignment
model
Ghanbarizadeh x DEMATEL, ANP,
et al. (2019) VIKOR
Aloini et al. (2019) x Fuzzy-based decision
support system
Lamenza et al. x AHP
(2019)
Hao et al. (2020) Multi-objective
optimization model
Visani and Boccali x DEA
(2020)
Perdana and x AHP
Table 1. Mulyono (2021)
Quantitative studies by Arantes et al. x AHP and MDS
methods, type of (2022)
purchasing portfolio This paper x x1 x x x x SVN-AHP and SVN-
model, supplier TOPSIS
characteristics and
buyer–seller Note(s): x1: Supplier relationship model; x2: Lean and agile PPM; x3: Supplier classification model; x4: Supplier
relationship performance evaluation model; x5: Multiple criteria supplier segmentation model; x6: Supplier potential matrix
characteristics Source(s): Created by authors
of this manufacturer was evaluated and according to the results, only one supplier should be Strategy
replaced and relations with twelve suppliers should be maintained. Using three different multi- segmentation
criteria decision making (MCDM) methods including the Preference Ranking Organization
Method for Enrichment Evaluation (PROMETHEE), Multi-Attribute Utility Theory (MAUT)
matrix
and AHP, Segura and Maroto (2017) classified the suppliers and items based on critical and
strategic dimensions. Montgomery et al. (2018) introduced a new methodology for positioning
items and services within KPM objectively and quantitatively. Ghanbarizadeh et al. (2019) have
proposed a model on the basis of KPM for the commercial building industry. The hybrid model
proposed by the researchers includes the Decision Making Trial and Evaluation Laboratory
(DEMATEL), Analytic Network Process (ANP) and VIseKriterijumsa Optimizacija I
Kompromisno Resenje (VIKOR) methods. Rezaei and Lajimi (2019) developed Kraljic’s
matrix considering suppliers’ capabilities and suppliers’ willingness to cooperate. Using the
Best–Worst method (BWM), the authors positioned suppliers in the segmentation matrix. An
illustrative implementation was carried out with the data gathered from seventy suppliers of an
organization operating in the computer hardware industry. While the optimal strategy for
seventeen suppliers is the replacement, for eight suppliers the best strategy is to remain high-
quality relations and expand the relations to include other products.
Bianchini et al. (2019) have developed a purchasing portfolio matrix on the basis of Kraljic’s
model for an Italian company, a leader in lighting products. They used the AHP method to
calculate criteria weights in the dimensions of the model. After supplier classification through
purchasing portfolio analysis, they suggested some possible strategies for managers to reduce
the lead time. In order to guide procurement strategies for relief materials in humanitarian
operations, Lamenza et al. (2019) have developed a purchasing model based on the KPM. An
illustrative implementation was performed in a government agency responsible for the purchase,
storage and distribution of relief supplies in S~ao Paulo. The proposed humanitarian procurement
model is a tool for humanitarian organizations’ professionals in adopting purchase strategies for
various aid supplies purchased for humanitarian operations. Aloini et al. (2019) proposed a
refined model that can overcome the subjective decision logic of current PPMs by using the
purchasing-related knowledge of the firms. This paper proposes a novel structure of outputs of
PPMs for a more analytical description of strategic aspects. It also restricts arbitrary and
compensatory operations in the material positioning. In order to evaluate suppliers, Garzon et al.
(2019) proposed a green purchasing approach based on Kraljic’s model. Their model allows the
buyer to evaluate suppliers in terms of price, quality and green supply chain. They performed an
illustrative application using data from four suppliers of an organization in the chemical industry.
In the paper of Hao et al. (2020), a portfolio optimization model for material procurement is
constructed in which only cost and supply risk are considered. The authors observed a
considerable negative correlation between cost and risk. They also noted that experts must strike
a balance between costs and risks to maximize the benefits of product sourcing.
Visani and Boccali (2020) proposed a three-stage Data envelopment analysis (DEA)-based
methodology to evaluate the purchasing price of leverage commodities concerning their value
attributes. Their model has been tested on two procurement classes (painting and glass) of a
company that produces tractor cabins. The authors found that the company potentially saved
V122,000 in two classes of purchases with a 6-month action plan. Perdana and Mulyono (2021)
positioned commodities purchased for coal mining operations into Kraljic’s matrix. Using the
AHP method, they identified each purchased item’s location in the matrix. The authors advised
the buyer to partner with suppliers of fuel and blasting materials. For the strategic management
of pharmaceutical purchasing for hospitals, Arantes et al. (2022) developed a PPM by using
KPM. First, they utilized the AHP to prioritize criteria and then the MDS technique to position
medicines in the model. They suggested some strategies for managers to purchase strategic
medicines, such as providing better bargaining conditions with suppliers, more effective
inventory management and establishing a group purchasing organization.
BIJ Although Kraljic’s model is the dominant approach in the literature, it neglected the
characteristics of suppliers and the buyer–supplier relationship (Padhi et al., 2012; Rezaei and
Lajimi, 2019). As can be seen in Table 1, in only three papers (Park et al., 2010; Osiro et al., 2014;
Rezaei and Lajimi, 2019), suppliers’ characteristics and buyer–supplier relationships are
evaluated with Kraljic’s model. However, in the evaluation of supplier characteristics, Osiro et al.
(2014) focused only on the delivery performance of suppliers, while Rezaei and Lajimi (2019)
solely considered the capabilities of suppliers. In addition, in the assessment of the buyer-
supplier relations, these three studies focused only on the supplier’s willingness to cooperate.
However, for a more comprehensive assessment of the buyer–supplier relationship, economic
norms and other relational norms such as trust, business understanding, loyalty and
communication should be considered together (Rahman and Bennett, 2009; Ferro et al., 2016).
In this study, we combined Kraljic’s model with the SRM approach, which takes into
account both the supplier capability/performance and the buyer–supplier relations from an
economic and relational perspective. The model we propose enables the buyer to understand
the supplier in a much more comprehensive manner and to produce more effective
negotiation strategies with the suppliers. Additionally, unlike the MCDM methods in the
current literature, this paper uses AHP and TOPSIS together for the first time under a
neutrosophic environment for the segmentation of items and suppliers. Detailed calculation
procedures of the SVN-AHP and SVN-TOPSIS methods are described in Section 3.
3. Methodology
This section identifies the methodological procedures employed in this study. The steps of the
proposed methodology are demonstrated in Figure 1 and the levels of the proposed model are
elaborated theoretically in the following subsections.
Figure 1.
The steps of the
proposed methodology
3.1 Strategy segmentation methodology Strategy
The strategy segmentation methodology shown in Figure 2 is based on the integration of two segmentation
main parts. Within the first part, the items are considered, and it is desired to categorize them.
For this aim, it is benefited from the portfolio model presented by Kraljic (1983). As shown in
matrix
Figure 2, Kraljic’s model is based on two dimensions: strategic impact and supply risk. The
supply risk dimension focuses on the complexity of the supply market and the strategic
impact dimension considers the significance of the purchases. Based on the scores for each
dimension, items are divided into four groups: noncritical, leverage, bottleneck and strategic
items (Khanuja and Jain, 2019). Bottleneck elements can be regarded as more important than
leverage elements because the governance of supply risk is more difficult than the
governance of the strategic impact (Park et al., 2010).
Despite its systematic structure, KPM has some drawbacks such as negligence of the
suppliers’ characteristics while determining the purchasing strategies for the supplied goods
(Padhi et al., 2012). To overcome these drawbacks, in the second part of the integrated
segmentation model, SRM offered by Olsen and Ellram (1997) is utilized. In the SRM
approach, as shown in Figure 2, suppliers are divided into four segments: low attractiveness
and low relationship strength (LALRS), low attractiveness and high relationship strength
(LAHRS), high attractiveness and low relationship strength (HALRS) and high attractiveness
and high relationship strength (HAHRS).
In the SRM approach, the supplier attractiveness dimension identifies the capabilities and
performance of suppliers while relationship strength focuses on the degree to which the
supplier satisfies the buyer in an economic and relational sense (Rahman and Bennett, 2009).
We have discussed in detail below the various strategies for dealing with parts of the SSM,
Figure 2.
Strategy segmentation
methodology
BIJ taking into account the features of the materials supplied, the features of the suppliers and the
relationship strength between the two parties.
3.1.1 Managing suppliers that provide noncritical items. Noncritical materials are usually
low-value items that can be procured from a large number of suppliers. Short-term
agreements should be made with these suppliers and transactional relationships should be
established, which are competitive and characterized by low relationship norms (Gangurde
and Chavan, 2016). The following strategies can be suggested regarding the attractiveness
level of suppliers.
(1) Low attractiveness and low relationship strength with the buyer (LALRS): Efforts
should be made by the buyer to select alternative suppliers as they are of low
importance and many suppliers can supply these items (Gangurde and Chavan,
2016).
(2) Low attractiveness and high relationship strength with the buyer (LAHRS): Since many
suitable alternatives on the market can supply noncritical items, the buyer should
consider more attractive suppliers.
(3) High attractiveness and low relationship strength with the buyer (HALRS): As the
supply market for those products is very competitive, it can be easy for the purchaser
to find attractive alternatives. However, the optimal strategy for these suppliers may
be to purchase a large percentage of their annual sales (Rezaei and Lajimi, 2019;
Gelderman and Van Weele, 2003).
(4) High attractiveness and high relationship strength with the buyer (HAHRS): Those are
the most suitable providers for noncritical materials and the most appropriate
strategy for those providers is to maintain the relationship with short-term
agreements (Rezaei and Lajimi, 2019; Gelderman and Van Weele, 2003).
3.1.2 Managing suppliers that provide leverage items. In general, leverage items are available
from a variety of suppliers. It is easy for purchasers to find alternatives providing the
required volume of leverage materials at similar prices and quality. Unquestionably, the
supplier’s features and relationship level guide the buyer in formulating management
strategies, as discussed below.
(1) Low attractiveness and low relationship strength with the buyer (LALRS): The
weakness of suppliers in this group affects the buyer more negatively, as these
products have a large impact on the buyer. In addition, as there are various
alternatives for leverage commodities in the market, replacement can be the best
strategy for these suppliers (Rezaei and Lajimi, 2019).
(2) Low attractiveness and high relationship strength with the buyer (LAHRS): Since there
are many suppliers for these items, it is not the appropriate decision for the buyer to
address the weaknesses of the suppliers in this segment. Moreover, although the
buyer–supplier relationship strength is high, the replacement strategy can work
perfectly here (Rezaei and Lajimi, 2019).
(3) High attractiveness and low relationship strength with the buyer (HALRS): The
purchaser can take action to strengthen its weak relations with the supplier.
Increasing the volume purchased by bundling several purchases together can be an
efficient action for this group (Gelderman and Van Weele, 2003).
the most appropriate suppliers for those materials and maintaining the relationship
with these suppliers is the most appropriate strategy. A developing partnership
strategy can only be pursued if the relevant supplier is willing to contribute to the Strategy
company’s competitive edge (Cani€els and Gelderman, 2005; Park et al., 2010). segmentation
3.1.3 Managing suppliers that provide bottleneck items. Bottleneck items are low-value items matrix
with a high supply risk. Those items may require purchasers to bear unforeseen costs. Thus,
procurement experts should provide volume insurance and find alternatives. However, the
supplier may be dominant in the market and in this case, the procurement strategy may be to
ensure continuity of supply, usually from a single-source and through long-term contracts
(Gangurde and Chavan, 2016). Considering two dimensions of SRM, the following strategies
are introduced:
(1) Low attractiveness and low relationship strength with the buyer (LALRS): A supplier
with a low attractiveness score is likely to exhibit poor operational performance.
Thus, it turns out that the best strategy for suppliers in this group may be the
replacement.
However, in some cases, the buyer may be exposed to the supplier’s unfavorable conditions
and a locked-in relationship with the supplier may occur. This position may be due to the
supplier having a certain degree of monopoly power (Cani€els and Gelderman, 2005) and the
buyer’s inability to substitute the product. The buyer can organize activities such as
information sharing, supplier awards and supplier certification to improve the supplier’s
poorly performing features.
(2) Low attractiveness and high relationship strength with the buyer (LAHRS): If the
supplier has high monopoly power and the item is not substitutable, the buyer may
have to endure a locked-in relationship with these suppliers. In this case, it may be the
best way to increase the competencies of these suppliers by implementing
appropriate supplier development activities such as information sharing, supplier
awards and supplier certification (Gosling et al., 2019).
However, if the supplier lacks monopoly power or the item is substitutable, the poor
capabilities of those providers may be a cause to replace them (Cani€els and Gelderman, 2005).
(3) High attractiveness and low relationship strength with the buyer (HALRS): Since the
risks associated with bottleneck items are so great, the high degree of risk can induce
the purchaser to enhance relationships with the providers of those materials.
Therefore, visiting the supplier’s company on a regular period, and increasing two-
way communication can help to strengthen weak relations (Krause and Ellram, 1997;
Rezaei and Lajimi, 2019).
the most suitable providers for these materials, and the buyer is expected to maintain
strong cooperative relations with these vendors (Rezaei and Lajimi, 2019; Park et al.,
2010).
3.1.4 Managing suppliers that provide strategic items. Strategic commodities can often be
procured from only a few vendors or even from a single source, causing considerable supply
risk. However, the buyer may seek to limit or decrease its dependence on the relevant provider
supplying the strategic product (Gangurde and Chavan, 2016). The following strategies can
be applied according to the attractiveness level of the suppliers:
(1) Low attractiveness and low relationship strength with the buyer (LALRS): Poor
relations with the provider may discourage the purchaser from investing in
developing the supplier. Although it is an arduous task, the buyer company should
look for another provider with whom to establish a novel relationship.
BIJ However, the purchaser may put up with the supplier and try to maintain the reluctant
relationship with the supplier in the best way possible. This may be because it has
considerable monopoly power and the likelihood of item substitutability is very low (Cani€els
and Gelderman, 2005). The buyer can organize activities such as intensive training programs
and joint projects to improve the supplier’s poor performing features. Moreover, regular
factory visits and offering supplier-specific incentives can help to enhance the relationship
strength between the two parties (Rezaei et al., 2015; Rezaei and Lajimi, 2019; Gosling
et al., 2019).
(2) Low attractiveness and high relationship strength with the buyer (LAHRS): The high
relationship strength between the buyer and the supplier reduces the risk level.
Cani€els and Gelderman (2005) proposed that the low capability levels of those
providers may be a cause for their replacement.
However, the fact that the supplier has significant monopoly power and the probability of
product substitution is very low may force the buyer into a locked-in relationship with the
provider. Therefore, the purchaser should focus on improving the underperforming areas of
these suppliers through activities such as intensive training programs and joint projects
(Gelderman and Van Weele, 2003; Gosling et al., 2019).
(3) High attractiveness and low relationship strength with the buyer (HALRS): The high
supply risk of these commodities obliges the buyer to improve poor relations with
such suppliers. To motivate suppliers, offering supplier-specific incentives is
essential to increase their commitment and trust (Rezaei et al., 2015; Gosling et al.,
2019).
(4) High attractiveness and high relationship strength with the buyer (HAHRS): The
supplier has unique abilities and special knowledge in the manufacture of materials
that are important to the end products of the buyer company. Since the buyer–
supplier relationship strength is relatively high, the buyer should be less concerned
about the supply risk of the item (Hariyani and Mishra, 2023).
In addition, items from different segments can be obtained from the same supplier. In this article,
the supplier that provides products from different segments is referred to as a multi-item supplier.
The buyer can determine appropriate strategies for multi-item suppliers according to the item that
needs the most attention. The attention is based on supply risk and strategic impact. Hence, the
priority is as follows: strategic, bottleneck, leverage and noncritical. For instance, in case a
supplier provides the items from the categories of strategic and noncritical, the strategic category
is considered as the reference category to determine the appropriate strategy.
3.2 SVNSs and preliminaries

In this part, the basic operations of SVNSs are presented:
Definition 1. A SVNN is shown by the degrees of truth-membership TeðxÞ, indeterminacy-
A
membership IeðxÞ and falsehood-membership FeðxÞ. For all x, TeðxÞ;
A A A
IeðxÞ; FeðxÞ e ½0; 1: Such that 0 ≤ TeðxÞ þ IeðxÞ þ FeðxÞ ≤ 3 (Başhan
A A A A A
et al., 2020).
Definition 2. Some operation sets are identified between two SVNSs as follows:
e ¼ hT ðxÞ; I ðxÞ; F ðxÞi and B
Let A e ¼ hT ðxÞ; I ðxÞ; F ðxÞi be two SVNSs. Their necessary
eA e
A e
A eB eB eB
operations are given in Equations (1)-(2) (Kahraman et al., 2020).

e ⊗B
A e ¼ T ðxÞ 3 T ðxÞ; I ðxÞ þ I ðxÞ I ðxÞ 3 I ðxÞ; F ðxÞ þ F ðxÞ F ðxÞ 3 F ðxÞ Strategy
e eB e eB e eB e eB e eB
A A A A A
segmentation
(1) matrix

e C ¼ F ðxÞ; 1 I ðxÞ; T ðxÞ
A (2)
e
A e
A e
A
e ¼ hT ðxÞ; I ðxÞ; F ðxÞi be a SVNN. The score function s(AÞ

Definition 3. Let A e given in
e A e A e A
Equation (3) can be used for deneutrosophication or ranking of SVNSs
(Kahraman et al., 2020).

e ¼ 2 þ T ðxÞ I ðxÞ F ðxÞ 3
s A (3)
e
A e
A e
A
3.3 SVN-AHP
AHP is an MCDM method that was first proposed by Saaty in 1988 and is generally
used for problem-solving and decision-making in complicated situations. The AHP
approach has the significant advantage of decomposing a decision problem into its
components and creating hierarchies of criteria. In this way, the decision problem is
decomposed into its smallest elements. Herein, the significance of each element
(criterion) becomes clear (Macharis et al., 2004). However, the classical AHP approach
generally does not take into account the uncertain and subjective knowledge in the
real world. The fuzzy version of AHP only takes into account the degree of truth
membership and does not consider the degree of indeterminacy and falsehood.
However, neutrosophic sets can effectively represent real-world issues, considering all
aspects of a decision problem (i.e. truthiness, indeterminacy and falsehood) (Abdel-
Basset et al., 2018). To facilitate the practical use of neutrosophic sets, single-valued
neutrosophic sets (SVNSs) have been developed by Wang et al. (2010). SVN-AHP takes
into account not only the degree of truth-membership but also degrees of
indeterminacy and falsehood. SVN-AHP methodology was employed in various
papers such as Kavus et al. (2022), Bilandi et al. (2020) and Abdel-Basset et al. (2018). In
this paper, the weights of the criteria in the dimension of KPM and SRM are computed
by employing the SVN-AHP approach developed by Kahraman et al. (2020). The steps
of SVN-AHP are demonstrated below.
Step 1. Define the MCDM problem with its criteria.
Step 2. Create a pairwise comparison matrix.
Using the scale in Table 2, the linguistic judgments of the experts are transformed into
SVNSs. The pairwise comparison matrices of criteria (P) e are presented in Equation (4).
2 3
ðT11 ; I11 ; F11 Þ ðT12 ; I12 ; F12 Þ ðT1n ; I1n ; F1n Þ
6 .. 7
6 ðT21 ; I21 ; F21 Þ 1 1 . 7
e
P¼6 6 7 (4)
.
.. .
. 7
4 1 1 . 5
ðTn1 ; In1 ; Fn1 Þ 1 ðTnn ; Inn ; Fnn Þ
BIJ Step 3. Check the consistency of the pairwise comparison matrix.
First, with the assistance of Equation (5), the SVNSs in the pairwise comparison matrix
become crisp. If the crisp pairwise comparison matrix is consistent, it can be said that the
pairwise matrix with SVNSs is also consistent.
dϑ ¼ 1 þ 10T 10I þ 10F (5)
Step 4. Compute the geometric mean for the criteria.

The geometric mean of the SVN parameters is computed by implementing Equation (6).
.
1
n
T1 ¼ ½1 3 T12 3 . . . 3 T1n

.
1
n
Tn ¼ ½Tn1 3 Tn2 3 . . . 3 1
.
1
n
I1m ¼ ½1 3 I12m 3 . . . 3 T1nm
(6)
.
1
n
Iim ¼ ½In1m 3 In2m 3 . . . 3 1
.
1
n
F1m ¼ ½1 3 F12u 3 . . . 3 F1nu

.
1
n
Fim ¼ ½Fn1m 3 Fn2m 3 . . . 3 1
Step 5. Derive the neutrosophic criteria weights.

Neutrosophic criteria weights are derived by dividing T, I and F values with the summation
of the geometric means for lower, middle and upper parameters as given in Equation (7).
Suppose the summation of the geometric average values is a1s for the lower parameters, a2s for
the middle parameters, and a3s for the upper parameters.
SVNSs
Linguistic terms T I F
Exactly equal (EE) importance 0.50 1.00 0.50

Medium high (MH) importance 0.70 0.80 0.30
Table 2. High (H) importance 0.80 0.50 0.10
Definition and SVN Very high (VH) importance 0.90 0.30 0.00
scales of the Absolutely high (AH) importance 1.00 0.20 0.00
linguistic terms Source(s): Created by authors
8
>
> Strategy
>
> a1l b1m c1u
>
> ; ; segmentation
>
>
>
> a3s a2s a1s matrix
>
>
>
>
>
> a2l b2m c2u
; ;
<
a3s a2s a1s
ej ¼
w (7)
>
> ..
>
>
>
> .
>
>
>
>
>
> ail bim ciu
>
> ; ;
>
> a3s a2s a1s
:
Step 6. Derive the crisp weights of the criteria

The crisp weights of each criterion are derived by using the deneutrosophication formula in
Equation (3).
3.4 SVN-TOPSIS
After calculating the criteria weights by the SVN-AHP method, the scores of alternatives in
item segmentation and supplier segmentation are obtained by using the SVN-TOPSIS
method. Suppose that A ¼ fρ1 ; ρ2 ; . . . ; ρi g be a set of alternatives and C ¼ fβ1 ; β2 ; ; . . . ; βj g
be a set of criteria for i 5 1,2,3, . . .,m and j 5 1,2,3, . . .,n. The elaborated procedure flow of
SVN-TOPSIS proposed by Başhan et al. (2020) is presented in detail below.
Step 1. Construct the SVN decision matrix considering the compromise assessment of
decision-makers.
In this step, the rating of each alternative against each criterion is represented with SVNSs. In
the decision matrix, alternatives with SVNSs can be expressed as follows:
D ¼ dij m 3 n ¼ ðTij ; Iij ; Fij Þm 3 n (8)
β 1 ; β2 ; ; . . . ; β j
0 1
ρ1 ðT11 ; I11 ; F11 Þ ðT1n ; I1n ; F1n Þ
ρ2 B
B ðT 21 ; I21 ; F21 Þ ðT2n ; I2n ; F2n Þ C
C
B .. .. C (9)
...@ . 1 . A
ρm ðTm1 ; Im1 ; Fm1 Þ ðTmn ; Imn ; Fmn Þ
Step 2. Construct a weighted SVN decision matrix according to the criteria.

wj Þ specified by SVN-AHP and the single-valued decision
Considering the criteria weights (e
matrix created in Step 1, the weighted SVN decision matrix is created using Equation (1).
e j ⊗ dij m 3 n ¼ ðTij wj ; Iij wj ; Fij wj Þm 3 n

Dwj ¼ dij m 3 nwj ¼ w (10)
β 1 ; β2 ; ; . . . ; β j
0 1
BIJ ρ1 ðT11 w1 ; I11 w1 ; F11 w1 Þ ðT1n wn ; I1n wn ; F1n wn Þ
ρ2 B
B ðT21 ; I21 ; F21 Þ ðT2n wn ; I2n wn ; F2n wn Þ C
w1 w1 w1
C
B .. .. C (11)
...@ . 1 . A
ρm ðTm1 w1 ; Im1 w1 ; Fm1 w1 Þ ðTmn wn ; Imn wn ; Fmn wn Þ
Step 3. Compute single-valued neutrosophic negative ideal solution (SVN-NIS) and single-
valued neutrosophic positive ideal solution (SVN-PIS).
In the TOPSIS approach, assessment criteria can be divided into two groups: benefit and cost.
In the conventional TOPSIS approach, PIS consists of the best attainable values of the
criteria, while NIS consists of the worst attainable values of the criteria. However, in this
paper, a unique alternative with the best values for each criterion (see Table 3 extremely good
for benefit criteria, extremely low for cost criteria) is considered when determining the PIS.
Similarly, when determining NIS, a unique alternative with the worst values for each criterion
(see Table 3, extremely bad for benefit criteria, extremely high for cost criteria) is considered.
SVN-NIS and SVN-PIS can be shown in Equations (12) and (13), respectively.

ρ−j ¼ Tw−j ; Iw−
j ; Fw−
j (12)

ρþj ¼ Twþ j ; Ij ; Fj
wþ wþ
(13)
Step 4. Compute the distance measures from SVN-NIS and SVN-PIS.

The distance measures given in Equations (14) and (15) are employed to measure the distance
of each alternative from SVN-NIS and SVN-PIS.
vffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffi
u X n n 2 2 2 o
u
si ¼ t1=3m 3
−
Tij wj ðxj Þ Tw− j þ Iij wj ðxj Þ Iw− j þ Fij wj ðxj Þ Fw− j (14)
j¼1
vffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffiffi
u X n n 2 2 2 o
u
si ¼ t1=3m 3
þ
Tij wj ðxj Þ Twþ j þ Iij wj ðxj Þ Iwþ j þ Fij wj ðxj Þ Fwþ j (15)
j¼1
SVNSs
Linguistic terms T I F
Extremely good/high (EG/EH) 1.00 0.00 0.00

Very very good/high (VVG/VVH) 0.90 0.10 0.10
Very good/high ((VG/VH) 0.80 0.15 0.20
Good/high (G/H) 0.70 0.25 0.30
Medium good/high (MG/MH) 0.60 0.35 0.40
Medium/Fair (M/F) 0.50 0.50 0.50
Medium bad/low (MB/ML) 0.40 0.65 0.60
Bad/low (B/L) 0.30 0.75 0.70
Table 3. Very bad/low (VB/VL) 0.20 0.85 0.80
Linguistic variables to Very very bad/low (VVB/VVL) 0.10 0.90 0.90
rate the significance of Extremely bad/low (EB/EL) 0.00 1.00 1.00
alternatives Source(s): Created by authors
Step 5. Compute the closeness coefficient (CC) score. Strategy
Using Equation (16), the closeness coefficient scores of each alternative are computed segmentation
according to the single-valued neutrosophic ideal solutions. matrix
s−
CCi ¼ − i þ (16)
si þ si
4. Application of the proposed methodology

The proposed methodology is implemented in one of the leading machinery manufacturers in
the field of aluminum and PVC profile processing in Turkey. Laser miter-cutting machines,
which are used in cutting products such as wood and aluminum by angling and which are
included in many sectors today, represent the main field of activity of the company.
Therefore, the analysis was only applied to laser miter-cutting machines, which are the
company’s best-selling and most-represented products.
The laser miter-cutting machine consists of 276 different components and 50 components
are provided by 21 different external suppliers while the rest are produced in-house. The
supplied components are shown in Table 4 along with their suppliers and codes.
As described in the previous chapter, the proposed methodology has five main phases.
However, the step of creating the SSM is not included in this section as it needs to be
developed before implementation. The relevant details of the steps are as follows.
Code Component Supplier Code Component Supplier
I1 Disher washer S1 I26 Engine bearing S9

I2 Cable union S8 I27 Plain washer S2
I3 Armature motor S12 I28 Dished washer S2
I4 Carbon brush cover cap S14 I29 Guide washer S2
I5 Phillips pan head screw S3 I30 Safety washer S2
I6 Laser switch S16 I31 Lens mount S19
I7 Fan S10 I32 Laser set S15
I8 Plain chamfered washer S2 I33 Safety cover-1 S20
I9 Bobbin S13 I34 Safety cover-2 S20
I10 Lever switch S16 I35 Snap ring S11
I11 Buldex screw S4 I36 Retaining rings S11
I12 Knurled screw S3 I37 Metal ring S11
I13 Binding post S8 I38 Circlip S11
I14 Coal S14 I39 Needle bearings S21
I15 Printed-circuit card S7 I40 Roller bearing S21
I16 Wave washer S1 I41 Adjusting screw S4
I17 Tooth lock washer S1 I42 Idle screw S4
I18 Terminals S8 I43 Wing screw S4
I19 Lens-1 S18 I44 Clamping screw S4
I20 Lens-2 S18 I45 Coil spring-2 S17
I21 Phillips truss head screw S3 I46 Ring nut S5
I22 Phillips cheese head screw S3 I47 Lock nut S5
I23 Phillips flat-head screw S3 I48 Steel acorn nut S5 Table 4.
I24 Engine S9 I49 Metallic flat gasket S6 Supplied components
I25 Coil spring-1 S17 I50 Nail gasket S6 with their suppliers
Source(s): Created by authors and codes
BIJ 4.1 Determining criteria in the dimensions
As can be seen in Table 5, in Kraljic’s model, eight criteria are determined to assess the supply
risk and strategic impact dimensions. As shown in Table 6, in the SRM approach, five criteria
defining supplier attractiveness dimension are identified. Two of the five criteria (e.g. quality
and delivery) focus on the supplier’s performance, while the rest consider the supplier’s
capability. Moreover, in the relationship strength dimension, five criteria are identified
considering the economic and social norms of the supplier from the buyer’s perspective.
4.2 Computing the importance weights of criteria via SVN-AHP

The criteria given in Section 4.1 are considered through the consensus evaluation of a team of
three experts to create a pairwise comparison matrix. Therefore, the relevant steps of SVN-
AHP are as shown below:
Step 1. The criteria used in the study are introduced in Section 4.1. with their definitions.
Step 2. Pairwise comparison matrices are established using the linguistic terms in Table 2.
Tables 7–10 denote pairwise comparison matrices for the criteria describing the
dimensions of strategic impact, supply risk, supplier attractiveness and relationship
strength, respectively. Then, linguistic variables have been transformed into SVNSs,
taking into account Table 2. Table 11 demonstrates the SVN pairwise comparison matrix
for the criteria of supply risk dimension as an example.
Step 3. The consistencies of the pairwise comparison matrices in Tables 7–10 are tested.
To check the consistencies, the SVNSs in the pairwise comparison matrices become crisp
by using Equation (5). The crisp pairwise comparison matrices in Tables 7–10 are found to
be consistent, thus, the matrices are consistent.
Step 4. The geometric means of each parameter for the criteria shown in Tables 7–10 are
obtained by employing Equation (6). As an example, the results for the criteria of supply
risk are demonstrated in Table 12.
Dimension Criterion Description Authors
Strategic Profitability (C1) Impact of the item on the buyer’s Padhi et al. (2012), Medeiros and
impact profit Ferreira (2018), Kraljic (1983)
Business growth Impact of the item on the buyer Park et al. (2010), Kraljic (1983),
(C2) image or business growth Medeiros and Ferreira (2018)
Purchase volume Product’s annual purchasing Ferreira et al. (2015), Rezaei and
(C3) volume (monetary) Lajimi (2019), Arantes et al. (2022),
Kraljic (1983)
Importance of Importance or need of purchasing Ferreira et al. (2015)
purchase (C4) each item by the department
Supply risk Supplier Availability of potential suppliers in Ferreira et al. (2015), Bianchini
availability (C5) the market for the item (monopoly or et al. (2019), Arantes et al. (2022)
oligopoly condition)
Product Possibility of substitution for the Ferreira et al. (2015), Rezaei and
availability (C6) supplied item Lajimi (2019)
Supply Supplier’s sourcing experience for Ghanbarizadeh et al. (2019)
experience (C7) each item
Table 5. Logistic Proximity/distance of the buyer Ferreira et al. (2015), Bianchini
Criteria for the KPM proximity (C8) from its supplier et al. (2019), Arantes et al. (2022)
approach Source(s): Created by authors
Dimension Criterion Description Authors
Strategy
segmentation
Supplier Quality (C9) The proportion of non-defective Olsen and Ellram (1997), matrix
attractiveness materials procured from the Sharma and Yu (2013),
supplier Bansal et al. (2014), Kara
and Fırat (2018)
Delivery (C10) Supplier’s performance to deliver Olsen and Ellram (1997),
the promised items on time Sharma and Yu (2013), Kara
and Fırat (2018), Parkouhi
et al. (2019)
Compliance with The extent to which the supplier’s Parkouhi et al. (2019)
environmental pollutants and discharges comply
regulations (C11) with legal obligations
Financial condition Supplier’s economic situation, Olsen and Ellram (1997),
(C12) debt structure, annual income, Kara and Fırat (2018),
and financial stability Parkouhi et al. (2019), Rezaei
and Lajimi (2019)
Production capability The degree of the supplier’s Kara and Fırat (2018),
(C13) production capability with regard Parkouhi et al. (2019)
to the conditions, qualification,
and capacity of the supplier’s
production facility, machinery,
employees
Relationship Trust (C14) Purchaser’s expectation that the Olsen and Ellram (1997),
strength supplier can be trusted to meet its Zaheer et al. (1998),
liabilities and will behave fairly Guimaraes et al. (2002)
and negotiate, even in cases where
there is a possibility of
opportunism
Commitment (C15) Purchaser’s desire to maintain a Olsen and Ellram (1997),
relationship with the supplier and Ferro et al. (2016), Morgan
its determination to do business and Hunt (1994)
with the supplier in the future
Economic satisfaction Positive affective state of the Ferro et al. (2016), Sanzo
(C16) buyer resulting from the et al. (2003)
supplier’s contribution to its
financial performance and
profitability
Information sharing The extent to which strategic, Ferro et al. (2016), Rahman
(C17) important, and complete and Bennet (2009), Routroy
information is shared by the and Pradhan (2014), Islami
supplier to the buyer throughout (2022)
the relationship
Business The extent to which the purchaser Guimaraes et al. (2002)
understanding (C18) has a common understanding
with its supplier regarding Table 6.
behaviors, goals, and policies Criteria for the SRM
Source(s): Created by authors approach
Step 5. Neutrosophic criteria weights are obtained by dividing T, I, and F functions with
the summations of the geometric mean values for lower, middle, and upper parameters as
shown in Equation (7). The neutrosophic criteria weights under each dimension are
demonstrated in Table 12.
Step 6. The neutrosophic criteria weights are converted to crisp values by employing
Equation (3). The crisp weights of each criterion are also shown in Table 13.
BIJ 4.3 Obtaining the scores of items via SVN-TOPSIS
The purpose of this step is to categorize the fifty procured products using the SVN-TOPSIS
approach, taking into account the procurement risk criteria (x-axis) and strategic impact
C1 C2 C3 C4
C1 EE AH MH H
Table 7.
C2 AHc EE Hc MHc
c
Pairwise comparison C3 MH H EE MH
c
matrix for the strategic C4 H MH MHc EE
impact criteria Source(s): Created by authors
C5 C6 C7 C8
C5 EE MH AH H
C6 MHc EE VH MH
Table 8.
Pairwise comparison C7 AHc VHc EE MHc
matrix for the supply C8 Hc MHc MH EE
risk criteria Source(s): Created by authors
C9 C10 C11 C12 C13
C9 EE MH AH VH H
C10 MHc EE VH H MH
Table 9.
C11 AHc VHc EE MHc Hc
Pairwise comparison C12 VHc Hc MH EE MHc
matrix for the supplier C13 Hc MHc H MH EE
attractiveness criteria Source(s): Created by authors
C14 C15 C16 C17 C18
C14 EE MHc VHc Hc MH

C15 MH EE Hc MHc H
Table 10.
C16 VH H EE MH AH
Pairwise comparison
matrix for the C17 H MH MHc EE VH
relationship strength C18 MHc Hc AHc VHc EE
criteria Source(s): Created by authors
C5 C6 C7 C8
T I F T I F T I F T I F
C5 0.50 1.00 0.50 0.70 0.80 0.30 1.00 0.20 0.00 0.80 0.50 0.10
Table 11. C6 0.30 0.20 0.70 0.50 1.00 0.50 0.90 0.30 0.00 0.70 0.80 0.30
Pairwise comparison C7 0.00 0.80 1.00 0.00 0.70 0.90 0.50 1.00 0.50 0.30 0.20 0.70
matrix for the supply C8 0.10 0.50 0.80 0.30 0.20 0.70 0.70 0.80 0.30 0.50 1.00 0.50
risk criteria by SVNSs Source(s): Created by authors
criteria (y-axis). In addition, in order to categorize the items, we employed the obtained Strategy
closeness coefficients as the decision rules presented in Table 14. segmentation
First, experts are asked to evaluate fifty items from external suppliers, taking into account
predetermined criteria. While making this assessment, the judgments of the experts are
matrix
consolidated, and linguistic terms were transformed into SVNSs with the assistance of the
scale in Table 3.
Step 1: The linguistic assessment matrix in Table 15 is constructed by experts’ consensus
evaluations on all items provided, taking into account the strategic impact criteria.
Moreover, all strategic impact factors are considered as benefit criteria.
Also, all supplied items are evaluated by experts, taking into account the criteria of the supply
risk, and the linguistic assessment matrix in Table 16 is constructed. In addition, all supply
SVNSs
Criterion T I F
C5 0.728 0.532 0.000

C6 0.554 0.467 0.000
Table 12.
C7 0.000 0.579 0.749 Geometric means of the
C8 0.320 0.532 0.539 T, I, and F parameters
Total 1.602 2.110 1.288 for the criteria of
Source(s): Created by authors supply risk
Neutrosophic weight
Dimension Criterion T I F Crisp weight
Strategic impact
Profitability (C1) 0.459 0.250 0.000 0.316
Business growth (C2) 0.000 0.250 0.459 0.184
Purchase volume (C3) 0.339 0.250 0.202 0.270
Importance of purchase (C4) 0.202 0.250 0.339 0.230
Supply risk
Supplier availability (C5) 0.565 0.252 0.000 0.311
Product availability (C6) 0.430 0.222 0.000 0.297
Supply experience (C7) 0.000 0.274 0.468 0.169
Logistic proximity (C8) 0.249 0.252 0.336 0.223
Supplier attractiveness
Quality (C9) 0.436 0.183 0.000 0.250
Delivery (C10) 0.343 0.183 0.000 0.240
Compliance with environmental regulations (C11) 0.000 0.216 0.436 0.150
Financial condition (C12) 0.000 0.216 0.343 0.160
Production capability (C13) 0.221 0.202 0.221 0.200
Relationship strength
Trust (C14) 0.000 0.216 0.343 0.160
Commitment (C15) 0.221 0.202 0.221 0.200
Economic satisfaction (C16) 0.436 0.183 0.000 0.250 Table 13.
Information sharing (C17) 0.343 0.183 0.000 0.240 Neutrosophic and crisp
Business understanding (C18) 0.000 0.216 0.436 0.150 weights of each
Source(s): Created by authors criterion
BIJ risk factors are regarded as cost criteria. Afterward, using Table 3, the linguistic terms in
Tables 15 and 16 are transformed into SVNSs. Table A1 demonstrates the neutrosophic
decision matrix for criterion C1 as an example.
Step 2: Considering the criteria weights and the decision matrix in Step 1, the weighted
neutrosophic decision matrix is created. As an example, Table A2 demonstrates the
weighted neutrosophic decision matrix for criterion C1.
Step 3: In this step, the SVN-NIS and SVN-PIS are obtained. The SVN-PIS and SVN-NIS for
the strategic impact and supply risk criteria are presented in Tables 17 and 18,
respectively.
Steps 4 and 5: The distances from SVN-NIS and SVN-PIS are computed for each item with
the assistance of Equations (14) and (15), respectively. The obtained results for strategic
impact and supply risk are presented in Tables 19 and 20. The closeness coefficient scores
of the items for the dimensions of strategic impact and supply risk are computed by using
Equation (16) and also demonstrated in Tables 19 and 20.
Considering the decision rules in Table 14, the items are categorized as shown in Figure 3.
Items I3, I9, I15, I19, I20 and I32 are categorized as strategical. Items I6, I10, I14, I24, I26 and
I31 are categorized as bottleneck. Items I2, I4, I7, I13, I18, I25, I33, I34, I39, I40 and I45 are
categorized as leverage. The other materials are categorized as noncritical.
Strategic impact scoring Supply risk scoring Segment
CCi ∈ ½0:000; 0:500 CCi ∈ ½0:000; 0:500 Non-critical

CCi ∈ ½0:000; 0:500 CCi ∈ ð0:500; 1:000 Bottleneck
Table 14. CCi ∈ ð0:500; 1:000 CCi ∈ ½0:000; 0:500 Leverage
Decision rules for the CCi ∈ ð0:500; 1:000 CCi ∈ ð0:500; 1:000 Strategic
categorization of items Source(s): Created by authors
Item C1 C2 C3 C4 Item C1 C2 C3 C4 Item C1 C2 C3 C4
I1 M EB VB VVB I18 G VG G VG I35 VB EB VVB VVB

I2 G G VG VG I19 G VVG VVG EG I36 VB EB VVB VB
I3 MG VVG EG VVG I20 VG VVG VVG EG I37 VB VB EB B
I4 G VG VG VG I21 B VB VB VVB I38 M EB VB VB
I5 B VVB VVB VB I22 VB VVB EB VB I39 M VG VVG VVG
I6 B VVB VB VVB I23 MG EB EB VVB I40 MG VVG VG VG
I7 VG VVG G VVG I24 B EB VVB VVB I41 B VB VVB VB
I8 VB VB VVB VB I25 VG VVG VVG VG I42 M VVB VVB VB
I9 G VVG VVG EG I26 VB VVB VVB VB I43 VB VVB EB B
I10 MG VVB VVB VVB I27 VB VVB VVB VVB I44 EB EB VB B
I11 B VVB VB VVB I28 VVB VB EB EB I45 G G VG G
I12 MB VB B EB I29 VVB VB B EB I46 VB VVB VVB VB
I13 G G VG VG I30 B VB B VVB I47 MG EB B VVB
I14 MG VB VVB VB I31 VB VVB VB VB I48 VB VB VB VVB
Table 15. I15 VG VG VVG VVG I32 MG VVG EG VVG I49 VB VB VB VB
Item evaluation for the I16 M VVB VB VVB I33 G VG EG VVG I50 G VB VB VB
criteria of strategic I17 VVB EB VVB EB I34 VG VG VVG VG
impact Source(s): Created by authors
Item C5 C6 C7 C8 Item C5 C6 C7 C8 Item C5 C6 C7 C8
Strategy
segmentation
I1 VH F ML MH I18 VVH H H H I35 VVH H H MH matrix
I2 VVH VH H H I19 VVL F F F I36 VH H MH MH
I3 ML ML F MH I20 VVL F F F I37 EH F MH MH
I4 VVH MH F F I21 VH H L ML I38 VH VH F MH
I5 VH H ML ML I22 VVH H L ML I39 VH F F F
I6 VVL VL F VL I23 VVH VH MH ML I40 VH VH F F
I7 VH H MH ML I24 VL L H F I41 EH MH VL VH
I8 VVH VH MH F I25 VVH H H H I42 VVH VH VL VH
I9 L VL F MH I26 VL L F F I43 VVH VH L VH
I10 VL VL ML VL I27 VH H L F I44 VVH VH L VH
I11 EH VH ML VH I28 VH H F F I45 EH VH F H
I12 VH H ML ML I29 VH H L F I46 VVH MH H H
I13 VH H H H I30 VH MH F F I47 VH VH F H
I14 L ML F F I31 EL EL VVL VVL I48 VVH MH H H
I15 EL EL MH H I32 VL VL L L I49 VVH VH F F
I16 VH H MH MH I33 VVH H VH MH I50 VVH MH H F Table 16.
I17 VH H MH MH I34 VVH H VVH MH Item evaluation for the
Source(s): Created by authors criteria of supply risk
SVN-PIS SVN-NIS
Criterion T I F Criterion T I F
C1 0.459 0.250 0.000 C1 0.000 1.000 1.000 Table 17.

C2 0.000 0.250 0.459 C2 0.000 1.000 1.000 Positive and negative
C3 0.339 0.250 0.202 C3 0.000 1.000 1.000 ideal solutions for the
C4 0.202 0.250 0.339 C4 0.000 1.000 1.000 strategic impact
Source(s): Created by authors criteria
SVN-PIS SVN-NIS
C5 0.000 1.000 1.000 C5 0.565 0.252 0.000

C6 0.000 1.000 1.000 C6 0.430 0.222 0.000 Table 18.
Source(s): Created by authors supply risk criteria
4.4 Obtaining the scores of suppliers via SVN-TOPSIS

The objective of this step is to categorize twenty-one suppliers using SVN-TOPSIS, taking
into account the supplier attractiveness criteria (x-axis) and relationship strength criteria
(y-axis). In addition, in order to categorize the suppliers, we used the derived closeness
coefficients as the decision rules presented in Table 21.
Initially, experts are asked to assess twenty-one suppliers considering pre-determined
criteria. While carrying out this assessment, the judgments of the experts were consolidated, and
linguistic variables were transformed into SVNSs with the assistance of the scale in Table 3.
BIJ

Item DSVNPIS =DSVNNIS CCi ¼ DSVNNIS
DSVNPIS þDSVNNIS
DSVNPIS þDSVNNIS
I1 0:502=0:203 0.288 I26 0:552=0:098 0.150

I2 0:153=0:497 0.765 I27 0:561=0:088 0.136
I3 0:153=0:542 0.779 I28 0:605=0:059 0.089
I4 0:142=0:508 0.781 I29 0:560=0:110 0.164
I5 0:531=0:128 0.195 I30 0:503=0:153 0.233
I6 0:527=0:131 0.199 I31 0:538=0:110 0.169
I7 0:123=0:532 0.812 I32 0:153=0:542 0.779
I8 0:544=0:104 0.161 I33 0:122=0:552 0.819
I9 0:118=0:556 0.825 I34 0:104=0:544 0.839
I10 0:488=0:242 0.332 I35 0:573=0:084 0.128
I11 0:527=0:131 0.199 I36 0:564=0:094 0.143
I12 0:500=0:180 0.265 I37 0:551=0:117 0.175
I13 0:153=0:497 0.765 I38 0:492=0:208 0.297
I14 0:469=0:249 0.347 I39 0:202=0:495 0.710
I15 0:095=0:554 0.853 I40 0:170=0:497 0.745
I16 0:489=0:205 0.296 I41 0:523=0:133 0.203
I17 0:605=0:051 0.077 I42 0:493=0:203 0.292
I18 0:159=0:491 0.756 I43 0:558=0:111 0.166
I19 0:118=0:556 0.825 I44 0:582=0:100 0.147
I20 0:083=0:576 0.874 I45 0:165=0:483 0.745
I21 0:519=0:136 0.207 I46 0:552=0:098 0.150
I22 0:570=0:092 0.139 I47 0:470=0:256 0.353
Table 19. I23 0:522=0:239 0.314 I48 0:541=0:107 0.166
Closeness coefficient I24 0:553=0:118 0.176 I49 0:530=0:115 0.179
scores of each item I25 0:098=0:551 0.849 I50 0:442=0:290 0.396
under strategic impact Source(s): Created by authors
Step 1: The linguistic assessment matrix in Table 15 is established by experts’ consensus

evaluations on all suppliers, taking into account the supplier attractiveness criteria. In
addition, all criteria that define supplier attractiveness are regarded as benefit criteria.
Moreover, all suppliers are evaluated with the consensus judgments of the experts, taking
into account the criteria of the relationship strength dimension. As a result of this evaluation,
the linguistic evaluation matrix in Table 23 is created. Also, all factors describing relationship
strength are accepted as benefit criteria. Afterward, using Table 3, the linguistic terms in
Tables 22 and 23 are transformed into SVNSs. Table A3 demonstrates the neutrosophic
decision matrix for criterion C9 as an example.
Step 2: Considering the criteria weights and the decision matrix in Step 1, the weighted
neutrosophic decision matrix is created. As an example, Table A4 presents the weighted
neutrosophic decision matrix for criterion C9.
Step 3: In this step, SVN-PIS and SVN-NIS are derived. The SVN-PIS and SVN-NIS of the
criteria defining supplier attractiveness and relationship strength are demonstrated in
Tables 24 and 25, respectively.
Steps 4 and 5: The distances from SVN-NIS and SVN-PIS are computed for each supplier
with the assistance of Equations (14) and (15), respectively. The results for supplier
attractiveness and relationship strength are shown in Tables 26 and 27. Closeness
Strategy

Item DSVNPIS =DSVNNIS CCi ¼ DSVNNIS segmentation
DSVNPIS þDSVNNIS DSVNPIS þDSVNNIS
matrix
I1 0:430=0:287 0.400 I26 0:238=0:469 0.664
I2 0:556=0:135 0.195 I27 0:456=0:276 0.377
I3 0:311=0:381 0.551 I28 0:469=0:238 0.336
I4 0:472=0:250 0.346 I29 0:456=0:276 0.377
I5 0:450=0:282 0.385 I30 0:447=0:258 0.366
I6 0:162=0:551 0.773 I31 0:040=0:657 0.943
I7 0:469=0:248 0.346 I32 0:149=0:535 0.783
I8 0:525=0:195 0.271 I33 0:534=0:167 0.239
I9 0:264=0:457 0.634 I34 0:541=0:164 0.232
I10 0:150=0:540 0.783 I35 0:524=0:176 0.251
I11 0:571=0:187 0.246 I36 0:492=0:198 0.286
I12 0:450=0:282 0.385 I37 0:506=0:243 0.324
I13 0:514=0:171 0.249 I38 0:505=0:200 0.283
I14 0:272=0:419 0.607 I39 0:425=0:286 0.402
I15 0:272=0:567 0.676 I40 0:493=0:223 0.311
I16 0:492=0:198 0.286 I41 0:525=0:267 0.337
I17 0:492=0:198 0.286 I42 0:537=0:237 0.306
I18 0:535=0:159 0.229 I43 0:540=0:214 0.283
I19 0:279=0:451 0.618 I44 0:540=0:214 0.283
I20 0:279=0:451 0.618 I45 0:566=0:169 0.230
I21 0:445=0:298 0.401 I46 0:516=0:187 0.266
I22 0:470=0:291 0.382 I47 0:517=0:185 0.263
I23 0:516=0:225 0.304 I48 0:516=0:187 0.266 Table 20.
I24 0:275=0:456 0.624 I49 0:515=0:214 0.293 Closeness coefficient
I25 0:535=0:159 0.229 I50 0:492=0:225 0.314 scores of each item
Source(s): Created by authors under supply risk
coefficient scores are calculated for each supplier using Equation (16). The scores of
twenty-one suppliers for the dimensions of supplier attractiveness and relationship
strength are also shown in Tables 26 and 27.
Considering the decision rules in Table 21, the suppliers are categorized as demonstrated in
Figure 4. Suppliers S1, S7, S12, S14 and S19 are positioned in the LALRS category. Suppliers
S2, S8, S16 and S18 are placed in the HALRS segment. Only two suppliers, S6 and S11, are
positioned in the LAHRS category. The other suppliers are located in the HAHRS segment.
4.5 Positioning of suppliers in SSM

Twenty-seven of the fifty items supplied were found to be noncritical, and those are provided
by seven different suppliers. As shown in Figure 5, supplier 1 is in the LALRS segment, while
suppliers 6 and 11 are in the LAHRS segment, so the most appropriate strategy is to terminate
the relationship with them. Supplier 2, which provides five different noncritical elements, is
attractive to the buyer, but its relationship with the buyer is weak. Purchasing a large
percentage of this supplier’s annual sales can make the buyer a key customer for supplier 2
and strengthen buyer–supplier relationships. In addition, the most optimal strategy for
suppliers 3, 4 and 5 is to maintain the relationship with short-term agreements.
As shown in Figure 5, eleven leverage items are provided from six different suppliers. The
relationship strength with supplier 8, which is attractive to the buyer, is weak. Increasing
BIJ
1
0.9
0.8 0.7
STRATEGIC IMPACT
0.4 0.5 0.6
0.3
0.2
0.1
0
Figure 3. 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1
The positions of items
in the KPM SUPPLY RISK
Source(s): Created by authors
Supplier attractiveness scoring Relationship strength scoring Segment
CCi ∈ ½0:000; 0:500 CCi ∈ ½0:000; 0:500 LALRS

Table 21. CCi ∈ ½0:000; 0:500 CCi ∈ ð0:500; 1:000 LAHRS
Decision rules for CCi ∈ ð0:500; 1:000 CCi ∈ ½0:000; 0:500 HALRS
categorization of CCi ∈ ð0:500; 1:000 CCi ∈ ð0:500; 1:000 HAHRS
suppliers Source(s): Created by authors
Supplier C9 C10 C11 C12 C13 Supplier C9 C10 C11 C12 C13
S1 B VB M VB B S12 M MB M VB M
S2 VG VG G VG G S13 VVG EG VVG MG VG
S3 VG VG M VVG G S14 M VVB VB VB M
S4 VVG VVG MG VG VG S15 M VG G G VVG
S5 G G VG VG MG S16 G G VVG VG VG
S6 B VVB VVB B M S17 G MG VG G MG
S7 MB VB MB MB B S18 G VG G VVG MG
S8 G G VG VG MG S19 VB VVB VB VB MG
Table 22. S9 VG EG M VVG G S20 B G M MG VG
Supplier evaluation for S10 G MG MG VG MG S21 G VG MG MG G
the criteria of supplier S11 M VVB B B M
attractiveness Source(s): Created by authors
Supplier C14 C15 C16 C17 C18 Supplier C14 C15 C16 C17 C18
Strategy
segmentation
S1 VB B B B MB S12 MG MB B B B matrix
S2 B B MB VB M S13 G G G VVG G
S3 B G G MG B S14 B B B VB M
S4 B G G G B S15 G VG VG VG VVG
S5 VB G G MG G S16 MB B MB B M
S6 MB G G G G S17 B G VG VVG M
S7 M B MB B VB S18 M M MB B VB
S8 M MB MB VB B S19 B B B VB VVB
S9 MG VG G VVG VG S20 B VG G VVG G Table 23.
S10 MB G G G VVG S21 B G G VG VG Supplier evaluation for
S11 VB VB VG G G the criteria of
Source(s): Created by authors relationship strength
SVN-PIS SVN-NIS
C9 0.436 0.183 0.000 C9 0.000 1.000 1.000

C10 0.343 0.183 0.000 C10 0.000 1.000 1.000
Table 24.
C13 0.221 0.202 0.221 C13 0.000 1.000 1.000 supplier attractiveness
SVN-PIS SVN-NIS
C14 0.000 0.216 0.343 C14 0.000 1.000 1.000

C15 0.221 0.202 0.221 C15 0.000 1.000 1.000
Table 25.
C18 0.000 0.216 0.436 C18 0.000 1.000 1.000 relationship strength

Supplier DSVNPIS =DSVNNIS CCi ¼ DSVNNIS
DSVNPIS þDSVNNIS
DSVNPIS þDSVNNIS
S1 0:503=0:195 0.280 S12 0:402=0:296 0.424

S2 0:146=0:538 0.787 S13 0:119=0:597 0.834
S3 0:176=0:529 0.750 S14 0:490=0:240 0.329
S4 0:125=0:573 0.821 S15 0:213=0:501 0.702
S5 0:188=0:500 0.727 S16 0:157=0:532 0.771
S6 0:519=0:196 0.274 S17 0:215=0:473 0.687
S7 0:474=0:216 0.313 S18 0:177=0:517 0.745
S8 0:188=0:500 0.727 S19 0:532=0:207 0.280 Table 26.
S9 0:164=0:565 0.775 S20 0:318=0:416 0.567 Closeness coefficient
S10 0:224=0:465 0.675 S21 0:196=0:492 0.715 scores of each supplier
S11 0:469=0:252 0.349 under supplier
Source(s): Created by authors attractiveness
BIJ
DSVNPIS þDSVNNIS
DSVNPIS þDSVNNIS
S1 0:494=0:191 0.279 S12 0:450=0:252 0.360

S2 0:475=0:222 0.319 S13 0:165=0:526 0.761
S3 0:323=0:405 0.556 S14 0:492=0:203 0.292
S4 0:311=0:425 0.577 S15 0:129=0:556 0.812
S5 0:294=0:436 0.597 S16 0:444=0:244 0.354
S6 0:241=0:462 0.657 S17 0:254=0:495 0.661
S7 0:464=0:231 0.333 S18 0:437=0:261 0.374
S8 0:460=0:237 0.340 S19 0:526=0:162 0.236
Table 27.
Closeness coefficient S9 0:159=0:538 0.772 S20 0:235=0:507 0.683
score of each supplier S10 0:233=0:480 0.673 S21 0:244=0:487 0.666
under relationship S11 0:353=0:427 0.548
strength Source(s): Created by authors
1
0.9
0.8
0.7
SUPPLIER ATTRACTIVENESS
0.6
0.5
0.4
0.3
0.2
0.1
0
Figure 4.
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1
The position of RELATIONSHIP STRENGTH
suppliers in the SRM
purchased volume by bundling several purchases can be an effective action to strengthen the
relationship with supplier 8. For four suppliers that are attractive and have a strong
relationship with the purchaser, namely suppliers 10, 17, 20 and 21, the most appropriate
strategy is to develop partnerships with them.
Strategy
segmentation
matrix
Figure 5.
Strategies to deal with
segments of SSM
Differently from noncritical and leverage items, strategic and bottleneck items have high
procurement risks. The suppliers of these items may not be attractive to the buyer, in which
case the buyer may face two situations: ending the relationship and staying in a locked
relationship. In this case, as mentioned in Section 3.1, two factors should be considered to
make a decision: the potential availability of suppliers for these items (C5) and the
substitutability of these items (C6). It is indicated by experts that if both of these factors are
evaluated with one of the three linguistic variables (i.e. very low, very very low, extremely low)
shown in Table 3, the buyer needs to remain in a locked-in relationship with unattractive
suppliers of strategic and bottleneck items.
As shown in Figure 5, six bottleneck items are provided by four different suppliers.
Different from the others, supplier 14 provides two types of items, bottleneck (i.e. item 14) and
leverage (i.e. item 4). Taking into account the multi-item supplier case explained at the end of
Section 3.1, the bottleneck segment is regarded as the reference category. Hence, the
relationship with supplier 14 should be terminated because this supplier is unattractive and
the strength of the relationship between the parties is low. However, the supply of a
BIJ bottleneck item (i.e. item 14) by supplier 14 cannot oblige the buyer to a locked-in relationship
with supplier 14 because supplier availability and product substitutability are not very low,
very very low or extremely low. The buyer should also terminate its relationship with supplier
19 in the LALRS segment. However, due to the extremely low availability of potential
suppliers for the supplied product and the extremely low substitutability of the supplied
product, the buyer has to remain in a locked relationship with supplier 19. The buyer may
organize activities such as information sharing and supplier awards/certifications to improve
the supplier’s poorly performing features. Moreover, the buyer is expected to maintain a
strong collaborative relationship with supplier 9.
Only six items provided by four suppliers are considered strategic for the buyer. Among
those, the performance of suppliers 7 and 12 is found unattractive for the buyer. In addition,
the relationship strength of these suppliers with the buyer is weak. The most appropriate
strategy for these suppliers is to terminate the relationship with them. However, due to the
extremely low market availability of potential suppliers capable of procuring item 15 and the
extremely low substitutability of item 15, the purchaser may have to engage in a locked-in
relationship with supplier 7. Under these circumstances, the buyer should organize activities
such as intensive training programs and joint projects to improve poor areas of supplier 7.
Moreover, regular factory visits and offering supplier-specific incentives can help to enhance
the relationship strength between the two parties. Finally, suppliers 13 and 15 are in the
HAHRS segment, and the buyer is expected to maintain a strong strategic partnership with
these suppliers. The strategies formulated for different segments are demonstrated in
Figure 5.
Considering the results of the proposed methodology, the following issues are provided for
the contribution to the research and applications related to purchasing portfolio matrix:
(1) SSM creates more effective strategies for negotiating with suppliers by focusing not
only on the items they provide, but also on their capabilities, performance and
relationship with the buyer.
(2) In the literature, several researchers have developed mathematical modeling
approaches for manufacturers to decide how best to allocate supplier development
investments among multiple suppliers (Talluri et al., 2010; Mizgier et al., 2017; Jafarian
et al., 2021). The SSM model enables the identification of potential suppliers to be
developed and replaced for such studies.
(3) The SSM model integrates the performance of suppliers with the characteristics and
availability of components and materials. Therefore, the proposed model provides an
awareness for product design processes with respect to the convenience at the
purchasing stage of the product life cycle.
(4) For the first time, MCDM methods are used synergistically in a neutrosophic setting
for the segmentation of products and suppliers.
5. Comparative analysis
In order to demonstrate the effectiveness and validity of SVN-AHP and SVN-TOPSIS
methods in the proposed methodology, comparisons are performed with the crisp and fuzzy
versions of these methods. For this purpose, firstly, the importance weights of the criteria are
compared with the importance weights obtained from the classical AHP (see Saaty, 1988),
_ and Yurdakul, 2021) and intuitionistic fuzzy AHP (IF-AHP) (see Xu
fuzzy AHP (F-AHP) (see Iç
and Liao, 2013) approaches. As shown in Figure 6, the rankings of the criteria obtained by
classical AHP, F-AHP and IF-AHP are the same as the result of the SVN-AHP approach.
However, it is noteworthy that the criteria weights obtained from the IF-AHP method are Strategy
close to the criteria weights derived from the SVN-AHP method. segmentation
Secondly, the relative performance scores of items and suppliers derived by the SVN-
TOPSIS approach are compared with the results obtained with classical TOPSIS (see Hwang
matrix
and Yoon, 1981), fuzzy TOPSIS (see Chen et al., 2006) and IF-TOPSIS (Kilic and Yalcin, 2020)
methods. The criteria weights obtained from AHP, F-AHP and IF-AHP are used as inputs in
classical TOPSIS, F-TOPSIS and IF-TOPSIS methods, respectively. Figures 7 and 8
demonstrate the strategic impact and supply risk scores of the items, respectively, which are
obtained by using TOPSIS, F-TOPSIS, IF-TOPSIS and SVN-TOPSIS methods. Considering
the KPM matrix we achieved by applying SVN-TOPSIS, it is observed that the segments of
the items do not change when IF-TOPSIS and F-TOPSIS are applied. However, the segments
of only three items (i.e. I14, I45, I50) differ from our results when classical TOPSIS is applied.
Also, under supplier attractiveness and relationship strength dimensions, the
performance scores of each supplier are compared with classical TOPSIS, F-TOPSIS and
IF-TOPSIS methods. Figures 9 and 10 show the attractiveness and relationship strength
0.6
0.5
0.4
0.3
0.2
0.1
0
Figure 6.
C1 C2 C3 C4 C5 C6 C7 C8 C9 C10 C11 C12 C13 C14 C15 C16 C17 C18
The criteria weights for
AHP F-AHP IF-AHP SVN-AHP AHP, SVN-AHP, IF-
AHP and F-AHP
0.8
0.6
0.4
0.2 Figure 7.
Comparison of
TOPSIS, F-TOPSIS, IF-
0 TOPSIS and SVN-
I1 I3 I5 I7 I9 I11 I13 I15 I17 I19 I21 I23 I25 I27 I29 I31 I33 I35 I37 I39 I41 I43 I45 I47 I49 TOPSIS methods
under strategic impact
TOPSIS F-TOPSIS IF-TOPSIS SVN-TOPSIS
dimension
BIJ 1
0.8
0.6
0.4
0.2
Figure 8.
Comparison of
0
TOPSIS and SVN-
I1 I3 I5 I7 I9 I11 I13 I15 I17 I19 I21 I23 I25 I27 I29 I31 I33 I35 I37 I39 I41 I43 I45 I47 I49
TOPSIS methods
under supply risk TOPSIS F-TOPSIS IF-TOPSIS SVN-TOPSIS
dimension
0.8
0.6
0.4
Figure 9.
Comparison of 0.2
TOPSIS and SVN-
TOPSIS methods 0
under supplier 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21
attractiveness
dimension TOPSIS F-TOPSIS IF-TOPSIS SVN-TOPSIS
0.8
0.6
0.4
Figure 10. 0.2

Comparison of
0
TOPSIS and SVN-
TOPSIS methods I1 I2 I3 I4 I5 I6 I7 I8 I9 I10 I11 I12 I13 I14 I15 I16 I17 I18 I19 I20 I21
under relationship
TOPSIS F-TOPSIS IF-TOPSIS SVN-TOPSIS
strength dimension
scores of the suppliers, respectively, which are calculated by employing classical TOPSIS, Strategy
F-TOPSIS, IF-TOPSIS and SVN-TOPSIS approaches. Considering the SRM matrix we segmentation
obtained by implementing SVN-TOPSIS, it is observed that the suppliers’ segments do not
change when IF-TOPSIS is implemented. While the segments of three suppliers (i.e. S15, S20,
matrix
S21) are different when F-TOPSIS is applied, only the segment of one supplier (i.e. S20) is
different from our findings when classical TOPSIS is applied.
The subjective judgments of the decision-makers can cause great uncertainty in the
decision-making process. Since the fuzzy concept considers solely the degree of truth
membership, it fails to reveal the truth and efficiently represents incomplete information.
However, IF sets can only cope with inconsistent information, but not enough to overcome the
vague and incomplete information in the real world. Neutrosophic sets (NSs), a generalization
of IF sets and fuzzy sets, are defined by three independent membership functions: falsehood
(rejection), truth (acceptation), and indeterminacy (ambiguity). NSs, in practical SVNSs,
indicate affirmative, negative, and ambiguous information and are more flexible than IF sets
and fuzzy sets (Kilic and Yalcin, 2021). Therefore, SVN-AHP and SVN-TOPSIS methods can
more effectively cope with uncertain and inconsistent information in this paper, thanks to the
three membership functions they contain.
6. Conclusion
Kraljic (1983) is one of the first researchers to develop the purchasing portfolio concept. The
seminal portfolio approach developed by Kraljic (1983) is a considerable tool for defining
supplier strategies over materials (Medeiros and Ferreira, 2018). While KPM has considerably
inspired academic research and impacted professional purchasing to date, it has also drawn
reasonable criticism (Padhi et al., 2012). KPM’s neglect of suppliers’ characteristics such as their
capabilities and performance, as well as the buyer–supplier relationship, stand out from these
criticisms. The development of portfolio models that take these criticisms into account is
something that the theoretical and empirical literature has largely overlooked. We aim to fill this
gap in the literature by proposing a novel model called strategy segmentation methodology
(SSM). In this methodology, by integrating the KPM approach with the SRM model, we aimed to
focus not only on the products provided by the suppliers but also on their capabilities,
performance, and relations with the buyer. We think that the proposed SSM model allows the
buyer to understand their suppliers in a much more comprehensive way and be able to create
more effective strategies for negotiating with their suppliers.
In the SSM, while the key properties of the items are mainly evaluated under two dimensions,
namely strategic impact and supply risk, the characteristics of the suppliers are fundamentally
considered in terms of supplier attractiveness and relationship strength between the two parties.
Considering two levels (low and high) for each dimension, each segmentation model contains
four categories, indicating that the proposed integrated matrix demonstrates sixteen categories.
In order to determine the relevant criteria defining each dimension of the two models, we
benefited from the research in the literature and expert opinions. After determining the relevant
criteria for each model, the SVN-AHP approach is utilized to calculate the weight of each
criterion. Afterward, using SVN-TOPSIS, the closeness scores of each item and supplier to the
ideal solutions are determined. Based on these scores, the segments of the procured items in the
KPM and categories of the suppliers in the SRM are revealed.
Eventually, an implementation is introduced for verification and elaborated analysis of
the proposed methodology. The analysis was applied to the laser miter-cutting machine,
consisting of 276 parts. The methodology is accomplished by categorizing fifty different
items supplied for this product in the KPM and categorizing twenty-one different suppliers
providing them in the SRM. As shown in Figure 5, distinct strategies are also proposed to
manage twenty-one suppliers in the SSM.
BIJ Supplier development is particularly significant for the critical commodities such as
strategic, bottleneck, and leverage items in the KPM (Osiro et al., 2014). Since supplier
development practices are supplier-specific investments that cannot be transferred to
another supplier, firms should be meticulous in identifying suppliers for development. In
particular, considering only the type of item to be procured or focusing solely on
suppliers’ specifications may lead to investing in a supplier that is not suitable for
development. The proposed SSM approach focuses not only on the items offered by
suppliers but also on their capabilities, performance and relationship with the buyer,
allowing the buyer to have a much more comprehensive understanding of their
suppliers. Thus, the buyer can make better decisions about which supplier should be
developed or which supplier should be replaced. We think that the proposed SSM
approach will shed light on researchers and business practitioners in identifying
potential suppliers for development or replacement.
The contributions of the proposed methodology are presented in the previous sections.
However, there are some limitations to the proposed methodology. One of the limitations is
the assumption of no dependency between the criteria. Another limitation is that no
optimization model has been developed to allocate investments to suppliers that need to be
developed. In addition, no systematic qualitative methodology such as the Delphi method is
implemented to gain and consolidate experts’ judgments.
Given the aforementioned limitations of the proposed methodology, potential further
papers could include SVN-ANP, taking into account the dependency between criteria while
handling indeterminacy and ambiguity in the evaluation process. In addition, the Delphi
approach can be used when determining the criteria for the dimensions of the SRM and
KPM matrices, due to its flexibility. Finally, in further papers, an optimization model can
be created for the allocation of supplier-specific investments made by the purchaser.
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(The Appendix follows overleaf)

BIJ Appendix
C1 C1 C1
Item T I F Item T I F Item T I F
I1 0.50 0.50 0.50 I18 0.70 0.25 0.30 I35 0.20 0.85 0.80
I2 0.70 0.25 0.30 I19 0.70 0.25 0.30 I36 0.20 0.85 0.80
I3 0.60 0.35 0.40 I20 0.80 0.15 0.20 I37 0.20 0.85 0.80
I4 0.70 0.25 0.30 I21 0.30 0.75 0.70 I38 0.50 0.50 0.50
I5 0.30 0.75 0.70 I22 0.20 0.85 0.80 I39 0.50 0.50 0.50
I6 0.30 0.75 0.70 I23 0.60 0.35 0.40 I40 0.60 0.35 0.40
I7 0.80 0.15 0.20 I24 0.30 0.75 0.70 I41 0.30 0.75 0.70
I8 0.20 0.85 0.80 I25 0.80 0.15 0.20 I42 0.50 0.50 0.50
I9 0.70 0.25 0.30 I26 0.20 0.85 0.80 I43 0.20 0.85 0.80
I10 0.60 0.35 0.40 I27 0.20 0.85 0.80 I44 0.00 1.00 1.00
I11 0.30 0.75 0.70 I28 0.10 0.90 0.90 I45 0.70 0.25 0.30
I12 0.40 0.65 0.60 I29 0.10 0.90 0.90 I46 0.20 0.85 0.80
I13 0.70 0.25 0.30 I30 0.30 0.75 0.70 I47 0.60 0.35 0.40
I14 0.60 0.35 0.40 I31 0.20 0.85 0.80 I48 0.20 0.85 0.80
I15 0.80 0.15 0.20 I32 0.60 0.35 0.40 I49 0.20 0.85 0.80
Table A1. I16 0.50 0.50 0.50 I33 0.70 0.25 0.30 I50 0.70 0.25 0.30
Neutrosophic decision I17 0.10 0.90 0.90 I34 0.80 0.15 0.20
matrix for criterion C1 Source(s): Created by authors
C1 C1 C1
Item T I F Item T I F Item T I F
I1 0.230 0.625 0.500 I18 0.321 0.438 0.300 I35 0.092 0.888 0.800
I2 0.321 0.438 0.300 I19 0.321 0.438 0.300 I36 0.092 0.888 0.800
I3 0.275 0.513 0.400 I20 0.367 0.363 0.200 I37 0.092 0.888 0.800
I4 0.321 0.438 0.300 I21 0.138 0.813 0.700 I38 0.230 0.625 0.500
I5 0.138 0.813 0.700 I22 0.092 0.888 0.800 I39 0.230 0.625 0.500
I6 0.138 0.813 0.700 I23 0.275 0.513 0.400 I40 0.275 0.513 0.400
I7 0.367 0.363 0.200 I24 0.138 0.813 0.700 I41 0.138 0.813 0.700
I8 0.092 0.888 0.800 I25 0.367 0.363 0.200 I42 0.230 0.625 0.500
I9 0.321 0.438 0.300 I26 0.092 0.888 0.800 I43 0.092 0.888 0.800
I10 0.275 0.513 0.400 I27 0.092 0.888 0.800 I44 0.000 1.000 1.000
I11 0.138 0.813 0.700 I28 0.046 0.925 0.900 I45 0.321 0.438 0.300
I12 0.184 0.738 0.600 I29 0.046 0.925 0.900 I46 0.092 0.888 0.800
I13 0.321 0.438 0.300 I30 0.138 0.813 0.700 I47 0.275 0.513 0.400
I14 0.275 0.513 0.400 I31 0.092 0.888 0.800 I48 0.092 0.888 0.800
Table A2. I15 0.367 0.363 0.200 I32 0.275 0.513 0.400 I49 0.092 0.888 0.800
Weighted neutrosophic I16 0.230 0.625 0.500 I33 0.321 0.438 0.300 I50 0.321 0.438 0.300
decision matrix for I17 0.046 0.925 0.900 I34 0.367 0.363 0.200
criterion C1 Source(s): Created by authors
C9 C9 Strategy
Supplier T I F Supplier T I F segmentation
S1 0.30 0.75 0.70 S12 0.50 0.50 0.50 matrix
S2 0.80 0.15 0.20 S13 0.90 0.10 0.10
S3 0.80 0.15 0.20 S14 0.50 0.50 0.50
S4 0.90 0.10 0.10 S15 0.50 0.50 0.50
S5 0.70 0.25 0.30 S16 0.70 0.25 0.30
S6 0.30 0.75 0.70 S17 0.70 0.25 0.30
S7 0.40 0.65 0.60 S18 0.70 0.25 0.30
S8 0.70 0.25 0.30 S19 0.20 0.85 0.80
S9 0.80 0.15 0.20 S20 0.30 0.75 0.70
S10 0.70 0.25 0.30 S21 0.70 0.25 0.30 Table A3.
S11 0.50 0.50 0.50 Neutrosophic decision
Source(s): Created by authors matrix for criterion C9
C9 C9
Supplier T I F Supplier T I F
S1 0.131 0.796 0.700 S12 0.218 0.592 0.500

S2 0.349 0.306 0.200 S13 0.392 0.265 0.100
S3 0.349 0.306 0.200 S14 0.218 0.592 0.500
S4 0.392 0.265 0.100 S15 0.218 0.592 0.500
S5 0.305 0.387 0.300 S16 0.305 0.387 0.300
S6 0.131 0.796 0.700 S17 0.305 0.387 0.300
S7 0.174 0.714 0.600 S18 0.305 0.387 0.300
S8 0.305 0.387 0.300 S19 0.087 0.877 0.800
S9 0.349 0.306 0.200 S20 0.131 0.796 0.700 Table A4.
S10 0.305 0.387 0.300 S21 0.305 0.387 0.300 Weighted neutrosophic
S11 0.218 0.592 0.500 decision matrix for
Source(s): Created by authors criterion C9
About the authors

Ahmet Selcuk Yalcin is working as a research assistant at Istanbul Okan University. He received his
bachelor’s degree from Beykent University. Afterward, he received his master’s degree from Marmara
University. He concentrated on the subject of supplier selection by considering environmental factors in
his master thesis. His research areas include supply chain management and decision making tools. He is
currently a PhD student in the department of industrial engineering at Istanbul Technical University.
Huseyin Selcuk Kilic works for the Department of Industrial Engineering at Marmara University. He
received the B.Sc., M.Sc. and Ph.D. degrees in industrial engineering from Istanbul Technical University.
He studied inplant logistics design for his Ph.D. dissertation. His main research areas are supply chain
management, reverse logistics, lean production, multi-criteria decision-making techniques and
ergonomics. He has research papers in journals that include Applied Mathematical Modelling,
Computers and Industrial Engineering, Decision Support Systems, International Journal of Advanced
Manufacturing Technology, and Assembly Automation.
Emre Cevikcan received the BS degree in Industrial Engineering from Yıldız Technical University,
the MSc degree and PhD degree in 2010 in Industrial Engineering from Istanbul Technical University.
He studied the scheduling of production systems for his PhD dissertation. Emre Cevikcan is currently an
associate professor in the Industrial Engineering Department of Istanbul Technical University. His
research has so far focused on evacuation planning, production systems (assembly lines, production
cells, etc.), lean production, scheduling. Emre Cevikcan is the corresponding author and can be contacted
at: cevikcan@itu.edu.tr
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A novel strategy segmentation Strategy

portfolio matrix and supplier

Olsen and Ellram 1 x x AHP

3.2 SVNSs and preliminaries

e ¼ hT ðxÞ; I ðxÞ; F ðxÞi be a SVNN. The score function s(AÞ

dϑ ¼ 1 þ 10T 10I þ 10F (5)

Step 4. Compute the geometric mean for the criteria.

Step 5. Derive the neutrosophic criteria weights.

Exactly equal (EE) importance 0.50 1.00 0.50

Step 6. Derive the crisp weights of the criteria

Step 2. Construct a weighted SVN decision matrix according to the criteria.

e j ⊗ dij m 3 n ¼ ðTij wj ; Iij wj ; Fij wj Þm 3 n

Step 4. Compute the distance measures from SVN-NIS and SVN-PIS.

Extremely good/high (EG/EH) 1.00 0.00 0.00

4. Application of the proposed methodology

Code Component Supplier Code Component Supplier

I1 Disher washer S1 I26 Engine bearing S9

4.2 Computing the importance weights of criteria via SVN-AHP

Dimension Criterion Description Authors

C9 C10 C11 C12 C13

C14 C15 C16 C17 C18

C14 EE MHc VHc Hc MH

C5 0.728 0.532 0.000

Strategic impact scoring Supply risk scoring Segment

CCi ∈ ½0:000; 0:500 CCi ∈ ½0:000; 0:500 Non-critical

Item C1 C2 C3 C4 Item C1 C2 C3 C4 Item C1 C2 C3 C4

I1 M EB VB VVB I18 G VG G VG I35 VB EB VVB VVB

C1 0.459 0.250 0.000 C1 0.000 1.000 1.000 Table 17.

C5 0.000 1.000 1.000 C5 0.565 0.252 0.000

4.4 Obtaining the scores of suppliers via SVN-TOPSIS

I1 0:502=0:203 0.288 I26 0:552=0:098 0.150

Step 1: The linguistic assessment matrix in Table 15 is established by experts’ consensus

4.5 Positioning of suppliers in SSM

Supplier attractiveness scoring Relationship strength scoring Segment

CCi ∈ ½0:000; 0:500 CCi ∈ ½0:000; 0:500 LALRS

C9 0.436 0.183 0.000 C9 0.000 1.000 1.000

C14 0.000 0.216 0.343 C14 0.000 1.000 1.000

S1 0:503=0:195 0.280 S12 0:402=0:296 0.424

S1 0:494=0:191 0.279 S12 0:450=0:252 0.360

Figure 10. 0.2

(The Appendix follows overleaf)

S1 0.131 0.796 0.700 S12 0.218 0.592 0.500

About the authors

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