Chance Constrained Multi-objective Programming for Supplier Selection and Order Allocation under Uncertainty

This paper proposes a chance-constrained multi-objective goal programming model for supplier selection problem with uncertain factors. Considering uncertain factors of demand, capacity and lead time and several objectives, the proposed approach provides chance constraints leading to a order allocation decision-making result. The decision keeps the confidence and risk of constraints to a certain level. Therefore, the optimization model makes sure of the procurement cost, including purchasing cost and penalty cost, being restricted within an acceptable level according to the confidence and risk value initially set. The paper also provides a comparison between the conventional model (deterministic constraints) and proposed model (chance constraints) and shows the superiority of the latter.