Incorporating data quality into a multi-product procurement planning under risk

Purpose In the data-driven era, the quality of the data exchanged between suppliers and buyer can enhance the buyer’s ability to appropriately cope with the risks and uncertainties associated with raw material purchasing. This paper aims to address the issue of supplier selection and purchasing planning considering the quality of data by benefiting from suppliers’ synergistic effects. Design/methodology/approach An approach is proposed to measure data visibility’s total value using a multi-stage algorithm. A multi-objective mathematical optimization model is then developed to determine the optimal integrated purchasing plan in a multi-product setting under risk. The model contemplates three essential objective functions, i.e. maximizing total data quality and quantity level, minimizing purchasing risks and minimizing total costs. Findings With emerging competitive areas, in the presence of industry 4.0, internet of things and big data, high data quality can improve the process of supply chain decision-making. This paper supports the managers for the procurement planning of modern organizations under risk and thus provides an in-depth understanding for the enterprises having the readiness for industry 4.0 transformation. Originality/value Various data quality attributes are comprehensively subjected to deeper analysis. An applicable procedure is proposed to determine the total value of data quality and quantity required for supplier selection. Besides, a novel multi-objective optimization model is developed to determine the purchasing plan under risk.