International Journal of Advanced Research in Engineering and Technology (IJARET)

Volume 11, Issue 5, May 2020, pp. 298-308, Article ID: IJARET_11_05_031
Available online at[Link]
ISSN Print: 0976-6480 and ISSN Online: 0976-6499
DOI: 10.34218/IJARET.11.5.2020.031

© IAEME Publication Scopus Indexed

RANKING OF SUPPLIER PERFORMANCE

USING MACHINE LEARNING ALGORITHM OF
RANDOM FOREST
Vincent H Wilson
Professor, Department of Manufacturing Engineering, School of Mechanical Engineering
(SMEC), Vellore Institute of Technology, Vellore, India.

Arun Prasad N S
UG Student, Department of Manufacturing Engineering, School of Mechanical Engineering
(SMEC), Vellore Institute of Technology, Vellore, India

Aswin Shankharan
UG Student, Department of Manufacturing Engineering, School of Mechanical Engineering
(SMEC), Vellore Institute of Technology, Vellore, India

Sushant Kapoor
UG Student, Department of Technology Management, School of Mechanical Engineering
(SMEC), Vellore Institute of Technology, Vellore, India

John Rajan A
Professor, Department of Manufacturing Engineering, School of Mechanical Engineering
(SMEC), Vellore Institute of Technology, Vellore, India

ABSTRACT
In this current data-driven world, corporate and industries need decisions driven
by data for staying ahead of the competition and to satisfy the customers. To calculate
the results using algorithms that could learn from the fluctuations and abnormalities
has been sought after by tech companies as we are now started moving towards
industry 4.0. At this time of advent, Machine Learning and Data Science are going to
play a major role in shaping the industry and help in its operations. Furthermore, if
we look into the industries, many tech and manufacturing conglomerates need
suppliers to furnish them with services, materials, and semi-finished products for their
operations. Finding the best supplier has been an age-old problem and several
solutions have been introduced over the period. In this paper, we will look at how this
age-old problem could be solved using modern techniques.
Keywords: MCDM (Multi-Criteria Decision Making), Fuzzy AHP, Machine
Learning, Decision Tree, Random Forest, Supplier Performance

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 Ranking of Supplier Performance Using Machine Learning Algorithm of Random Forest

Cite this Article: Vincent H Wilson, Arun Prasad N S, Aswin Shankharan,

Sushant Kapoor and John Rajan A, Ranking of Supplier Performance Using Machine
Learning Algorithm of Random Forest, International Journal of Advanced Research
in Engineering and Technology (IJARET), 11(5), 2020, pp. 298-308.
[Link]

1. INTRODUCTION
Selecting the best supplier for a product is a very important task in the process of outsourcing
and various MCDM (Multi-Criteria Decision Making) approaches have been used for this.
The approaches that have been used are the Genetic algorithm, DEMATEL, ELECTRE,
TOPSIS, VIKOR, Simple multi-attribute rating technique, Analytic Hierarchy Process, and so
on. These methods require extensive manual calculations and if there is a large entry of data,
then each method gives out different answers. Therefore, to make the calculations accurate
and faster, thereby saving a lot of time, we use Machine Learning Algorithms to find out the
best supplier by providing data.
In this paper, we are going to use a Machine Learning method called Random Forest to
find the best supplier performance from a set of 20 suppliers. Each supplier is evaluated under
different criteria and sub-criteria. These criteria which are used in this paper are already used
by various experts in the manufacturing sectors and used up in research papers [1]. Several
factors decide the performance of the supplier and each factor/criteria has a different
weightage. To calculate this weightage the experts have used various methods and, in this
paper, we will rank the suppliers based on the rank obtained by the Fuzzy AHP method [2].

1.1. Machine Learning

Machine Learning is used for two types of problems, namely Classification and Regression.
In this context, we have to classify the data and no need for calculation of any unknown data.
On the topic of classification if we further lookup, we would see that there are 179 classifiers
subdivided from 17 families/groups (Bayesian, stacking, support vector machines, decision
trees, rule-based classifiers, boosting, bagging, random forests and other ensembles, neural
networks, generalized linear models, nearest K neighbors, partial least squares and principal
component regression, logistic and multinomial regression, discriminant analysis, multiple
adaptive regression splines, and other methods), implemented in Python, C, Weka, Apache
Spark and so on, and also other classifiers being added daily through research[3].
Now when we look into the data we have, the grading of each supplier on each criterion
needs a lot of decisions to be made in each level of the problem. So they should have decision
trees in each level and a forest of random decision trees to connect all i.e. Random Forest. The
methodology on how each decision tree works and how they contribute to the random forest
will be explained afterwards in this paper. The reason why we chose using a machine learning
algorithm rather than just programming with the formulas of any MCDM method is that we
want the machine to understand the data and predict the best cause abnormalities arise and
even humans make errors.

2. LITERATURE REVIEW
The selection of supplier is process involving lots of factors and there had been literature
works in the past categorizing the factors. The basic criterion/factors are Quality, Delivery,
Price and Service [4][5][6]. The set of criteria and sub criteria are usually determined by a
group of specialists within the organization and can also be chosen from many studies and
literature works conducted during this subject.

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 Vincent H Wilson, Arun Prasad N S, Aswin Shankharan, Sushant Kapoor and John Rajan A

This paper discusses about the evaluation and ranking of 20 suppliers of a manufacturing
industry based on their performance. The performances of these suppliers are evaluated based
on several criteria and sub criteria. They are classified under 3 main Criteria –
• Quality, Delivery and Performance History
• Capacity and Capability
• Responsiveness, Service, Safety and Trust
Under each criterion there are few sub criteria. These criteria have been widely used for
the performance evaluation of suppliers and have been discussed in several literatures as
indicated in Table 1[2][1].

Table 1 Criteria and Sub Criteria for Supplier (Performance) Evaluation

Quality, Delivery & Performance Capacity & Capability Responsiveness, Service, Safety &
History (QDP) (CC) Trust (RSST)
Quality – Product & Manufacturing Product Range & Capacity Discipline and Professionalism
Quality – Service & Working Administration Capability Accessibility, Availability and
Environment Dependability
QC & QA Documentation – Certification Technical Capability Complaince with timeline,
& Validity punctuality & rules
Complaince to Delivery Commitments Financial Capability Accidents
Completions – PGMA/ DU/ Tonnage Infrastructure, Facilities & Complaince with Safety Standards &
Layout Design Rules
Past Records, Highlights, Achievements Man Power – Skill, Firm & Personnel Trust,
& Breakthroughs Qualification & Certification Transparency with business partner
Machinery, HT & NDT Security of Materials -Risk Vendor
Facilities

2.1. Weightage of Criteria

Analytical Hierarchical Process (AHP) developed by Saaty in the 1970s is one of the most
used methods for quantifying the weights of each criterion and thereby helping us understand
which criteria are important over others. An AHP hierarchy could be a structured means that
of modeling the choice at hand. It consists of associate degree overall goal, a bunch of choices
or alternatives for reaching the goal, and a bunch of things or criteria that relate the
alternatives to the goal. the factors may be additionally de-escalated into subcriteria, sub-sub
criteria, and so on, on several levels because of the drawback needs. A criterion might not
apply uniformly, however, it could have hierarchical variations sort of a very little sweetness
is gratifying but an excessive amount of sweetness may be harmful. therein case the criterion
is split into subcriteria indicating different intensities of the criterion, like very little, medium,
high, and these intensities are prioritized through comparisons beneath the parent criterion,
sweetness.
As these criteria’s are being used by researchers in the supply chain field for over a period
of time [7], we could get the weightage of the sub-criteria which we have found in the
literature review and therefore we could get the rank of sub-criteria under each criteria on
which they are classified[2].

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 Ranking of Supplier Performance Using Machine Learning Algorithm of Random Forest

Table 2 Ranking of Criteria Using FAHP

Crite Quality, Delivery, & Performance Capacity & Capability (CC) Responsiveness, Service, Safety & Trust
ria History (QDP) (RSST)
Weig 0.75 0.207 0.047
htage
Rank 1 2 3
Sub Q Q Q Q Q Q C C C C C C C RS RS RS RS RS RS RS
Criter DP DP DP DP DP DP C C C C C C C ST ST ST ST ST ST ST
ia 1 2 3 4 5 6 1 2 3 4 5 6 7 1 2 3 4 5 6 7
Weig 0.4 0.1 0.1 0.0 0.0 0.0 0. 0. 0. 0. 0. 0. 0. 0.0 0.0 0.0 0.0 0.0 0.0 0.0
htage 04 27 33 66 44 24 10 03 0 02 01 01 00 19 14 12 1 05 02 02
4 7 5 2 7 1 6
Rank 1 2 3 4 5 6 1 2 3 4 5 6 7 1 2 3 4 5 6 7

In table 2 we can see how the sub-criteria are ranked based on their weightage. Based on
these as target values we would compare it with the values given to suppliers for each of the
criteria to rank the supplier performance.

3. RANDOM FOREST METHOD

3.1. Decision Tree
It is a supervised machine learning approach which could be used for both classification and
regression problems. The idea for this algorithm originated from an ordinary tree which has a
root, that subdivide to branches and then leaves. It is far more easier to understand decision
tree as compared to other classification algorithms. The tree representation of the algorithm
makes it easier to understand with the leaf nodes corresponding to class label and the internal
nodes corresponding to an attribute. The below figure will help us understand the decision
tree better.

Figure 1 Representation of Decision Tree for deciding whether a person is fit

([Link]

3.2. Random Forest Algorithm

Random Forest Algorithm works best for classifiers involving a lot of criteria to be
considered upon. As we know a forest consists of trees, even in this Random Forest
Algorithm we have different decision trees on various sub-criterias of the given dataset and
this algorithm takes the average out of them to increase the predictive accuracy [8]. Now that
what it contributes to our paper is that we have different criteria’s and each criteria would

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 Vincent H Wilson, Arun Prasad N S, Aswin Shankharan, Sushant Kapoor and John Rajan A

give out different vendors as the best based on its decision tree, now with the help of Random
Forest Algorithm we can get to the best supplier out of the total decisions made. Moreover, to
increase the accuracy of the results we can divide the dataset into training sets and testing sets
for calculation purposes. The Random Forest method could be best explained in the below
Figure 2.

Figure 2 Working of Random Forest algorithm ([Link]

learningrandom-forest-algorithm)

4. CODE AND OUTPUT

We are using Python for this Machine Learning process as it is easy, cheap, robust and
adaptable environment. As Random Forest is a classifier and is stored in packages. To access
various such packages which would help us with our program we need a GUI (Graphic User
Interface). Here we use Anaconda Navigator as it has lots of packages which could be used
for Machine Learning and moreover it provides with various libraries and channels without
using command-line commands. The python Random Forest Classifier uses an algorithm
where it classifies the data with value 1 as more important than 5. But we have used a scale
where 1 is least important and 5 is excellent.

Table 3 Code and Output

Comparison Scale Value
Very Poor 1
Poor 2
Good 3
Very Good 4
Excellent 5

4.1. Data
We have collected Data on 20 suppliers from BHEL (Bharat Heavy Electricals Limited),
Trichy for each criteria. Each supplier is labelled from V1 to V20 and are evaluated under 20
criteria as mentioned above in the literature review section. The data collected is shown below
in Table 4.

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 Ranking of Supplier Performance Using Machine Learning Algorithm of Random Forest

Table 4 Data collected on the Suppliers

Alt/ V V V V V V V V V V V
V1 V2 V3 V4 V5 V6 V7 V8 V9
Criteria 10 11 12 13 14 15 16 17 18 19 20
QDP 1 4 4 3 4 4 4 4 1 1 2 3 3 3 4 4 4 4 4 3 3
QDP 2 3 3 2 4 2 3 2 2 1 2 2 2 2 2 3 3 3 2 2 2
QDP 3 3 4 2 3 2 3 2 2 0 1 2 2 2 2 4 4 4 2 2 2
QDP 4 2 4 2 2 2 2 2 4 0 1 1 2 1 2 4 4 4 2 2 2
QDP 5 3 4 3 2 2 3 2 4 0 1 1 3 1 2 4 4 4 2 3 3
QDP 6 2 3 2 2 2 2 2 4 0 1 2 2 2 2 3 3 3 2 2 2
CC 1 3 3 3 4 3 3 3 4 1 1 3 3 3 3 3 3 3 3 3 3
CC 2 2 3 2 4 3 2 3 2 0 1 1 2 1 3 3 3 3 3 2 2
CC 3 3 4 3 4 3 3 3 4 1 2 3 3 3 3 4 4 4 3 3 3
CC 4 3 4 2 3 3 3 3 4 2 1 2 2 2 3 4 4 4 3 2 2
CC 5 3 4 2 4 3 3 3 4 1 1 2 2 2 3 4 4 4 3 2 2
CC 6 3 3 2 3 3 3 3 3 1 1 2 2 2 3 3 3 3 3 2 2
CC 7 3 3 2 3 3 3 3 4 0 1 2 2 2 3 3 3 3 3 2 2
RSST 1 3 3 2 4 3 3 3 2 2 1 2 2 2 3 3 3 3 3 2 2
RSST 2 3 4 2 2 3 3 3 2 1 2 1 2 1 3 4 4 4 3 2 2
RSST 3 2 4 3 2 2 2 2 2 0 1 1 3 1 2 4 4 4 2 3 3
RSST 4 0 0 0 0 0 0 0 1 1 1 0 0 0 0 0 0 0 0 0 0
RSST 5 3 4 3 3 3 3 3 1 1 1 2 3 2 3 4 4 4 3 3 3
RSST 6 4 4 3 3 2 4 2 2 2 2 2 3 2 2 4 4 4 2 3 3
RSST 7 0 0 0 0 0 0 0 0 1 1 1 0 1 0 0 0 0 0 0 0

5. PHYTHON CODE
import numpy as np
from matplotlib
import pyplot
as plt from
sklearn import
datasets import
pandas as pd
df=pd.read_csv("
Supplier
[Link]") df

inputs=[Link]('Alt/Criteria',axis='
columns')
inputs=[Link]('RANK',axis='c
olumns') target=df['RANK']

from sklearn import tree

initial_model=[Link]
assifier()
initial_model.fit(inputs,target)
initial_model.score(inputs,target)

from sklearn.model_selection
import train_test_split
X_train, X_test, y_train, y_test = train_test_split(inputs,target, test_size=0.2,
random_state=20) print(X_test)

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 Vincent H Wilson, Arun Prasad N S, Aswin Shankharan, Sushant Kapoor and John Rajan A

from [Link] import

RandomForestClassifier
model=RandomForestClassifier(n_estimators
=10, random_state=30)
[Link](X_train,y_train)
prediction_test=[Link](X_test)
prediction_test

feature_list=list([Link])
feature_imp=[Link](model.feature_importances_,index=feature_list).sort_values(asc
ending=True) feature_imp

import
seaborn as
sns
%matplotlib
inline
[Link](x=feature_imp,
y=feature_imp.index)
[Link]('Supplier Rejection
Score') [Link]('Suppliers')
[Link]("Visualizing
Performance
Features") [Link]()
[Link]()

5.1. Final Output

Figure 3 Supplier Ranking from Top to bottom

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 Ranking of Supplier Performance Using Machine Learning Algorithm of Random Forest

6. RESULT AND CONCLUSION

From Figure 3 it is could be found out that V15, V20, V18, V7 and V14 have less rejection
score thereby ranked highest. We could therefore consider them as best options and reject V9
as it comes at the bottom with the highest rejection rate.
As machine learning has made a process which takes over a lot of time to finish and
analyse, we have saved much of our time and cost involved in the calculation. We thereby
have a competitive advantage over our competitors.
There are further more classifiers and data that could be used for calculating the best
suppliers for an industry and would be an area of future scope for research.

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