Key words: Analytic Hierarchy Process (AHP), raw materials, stock management

Abstract

For the most important kaolinite Grudzen (S2) raw material the model M4 was determined by AHP method to be the most profitable one. For the clay TC1W (S1) raw material the model M3 is a little more favorable than the model M1. Both models can be therefore applied to S1 raw material management. For the clay Bełchatów (S3) raw material the models M2 and M1 appear to be equally good. The less important chalk raw material (S6) can be managed the best by the models M1 and M4. The results of applying AHP method obtained for the presented example show it can be successfully applied for real-world resources’ management problems in production companies.

INTRODUCTION

One of the key problems for production firms is raw material stock management. In many small and medium sizes Polish firms the problem of raw materials storage occurs. Firms very often apply former experience and are based on agreements with suppliers. Some logistics methods are used to determine the time of and quantity of ordering (Kempny, 1993; Sarjusz-Wolski, 2000 & 1974).

The problem of choosing logistics method for control the optimal level of stock for each sort of raw material separately is – as it will be shown further – multicriterial. It can be formulated as the problem of choosing the best alternative and solved by means of AHP method (Golden at al., 1989). Application of that method seems to be attractive for decision makers (Saaty & Kearns, 1991; Satty & Vargas, 1991).

The aim of this paper is to show how the AHP method can be applied for each sort of raw material stock management. For numerical illustration we use numerical data from a ceramic factory. The paper consists of five sections. In section 2 logistics of raw materials is discussed. In section 3 raw material stock management in a ceramic factory is shown. In section 4 application of AHP method for raw material stock management in the ceramic factory is proposed. The summary is given in section 5.