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Positioning of commodities using the Kraljic Portfolio Matrix |
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| Authors: | Sidhartha S Padhi Stephan M Wagner Vijay Aggarwal |
| Institution: | 1. Chair of Logistics Management, Department of Management, Technology, and Economics, Swiss Federal Institute of Technology Zurich, Scheuchzerstrasse 7, 8092 Zurich, Switzerland;2. Operations Management Group, Management Development Institute Gurgaon, Gurgaon, Haryana 122007, India;1. Marketing and Supply Chain Management Area, College of Business Administration, California State University, Sacramento, Tahoe Hall 2015, 6000 J Street, Sacramento, CA, 95819-6088, USA;2. National Association of State Procurement Officials (NASPO), 201 E. Main St., Suite 1405, Lexington, KY, 40507, USA |
| Abstract: | This article proposes a more objective methodology to classify and position commodities (works and services) in the Kraljic Portfolio Matrix (KPM) in a continuous scale around the two dimensions of supply risk and profit impact—the two dimensions which mainly influence the choice of a firm's purchasing strategy. Fuzzy multi-attribute scoring is used to assign performance scores to different commodities on supply risk as well as profit impact attributes. With a multidimensional scaling approach the commodities are placed in the KPM. An application of the proposed approach is attempted on commodities procured by the Rural Development Department of a state government in India. |
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