A hybrid approach to IT outsourcing vendor selection by integrated analytic network process and grey relational analysis

This paper proposes a two-stage vendor selection framework for IT outsourcing in commercial banks. With the social choice function—Dodgson function, the first stage is a trial phase that helps the decision-maker find the potential vendors, then, the decision-maker employs those chosen vendors for the final selection with modified grey relational analysis (GRA) integrated analytic network process (ANP), which emphasizes the interrelation among those selection criteria, and avoids the subjective estimation of experts and practitioners. The result of the empirical study shows that the proposed method is practical for ranking competing vendors in terms of their overall performance with respect to multiple interdependence criteria for IT outsourcing in commercial banks.