A Qualitative Study into the Supplier Selection Decision-Making Process in the Malaysian SME Manufacturing Industry

In manufacturing, supplier selection is viewed as the foundation of supply chain management, as the choice of the supplier will inherently affect all other aspects of business. This study explores the supplier selection decision-making process within Malaysian manufacturing firms. Previous studies in supplier selection have focused on company performance and quality management. Preceding research in this field, offers evidence that the application of information technology tools, business intelligence tools and artificial intelligence tools can be beneficial to the supplier selection decision-making process. In particular, the study explores the presence and usage of the information technology tools, business intelligence tools and artificial intelligence tools, to support the supplier selection decision making process in Malaysian SME manufacturing companies.

Data for this research has been collected from six cases located in Malaysia, and was lead through semi-structured interviews. The findings present online global marketplaces as a supplier sourcing method, unstructured evaluation methods and supplier selection process. Information technology supports the supplier selection process by the usage of mobile applications and online communication tools to increase the speed of information exchange. Business intelligence presents tools developed in Malaysia, in alignment with the needs of Malaysian SME manufacturers.

Artificial intelligence tools presented no usage or presence in these cases. Finally, this study uncovers the impact of Malaysian culture on the supplier selection process and their supporting tools.

Amongst the contributions are: an understanding of the supplier selection process in the Malaysian SME manufacturing, shedding light on the supplier evaluation process, supplier selection criteria and supplier sourcing methods. Adding a new dimension to the existing body of literature is the use of ICT and BI tools, which support the supplier selection process. The contributions are of benefit to practitioners, as the components of the study sheds light into a non-western context.