Abstract
With the burgeoning development of TFT-LCD industry, many related component companies have headed into mass production. The growing production capacity of TFT-LCDs leads to price declines; therefore, TFT-LCD makers continue to compress prices on raw materials and their gross profits continue to shrink. In order to expand the production capacity and also maintain profits, defining the right outsourcing strategy is even more important than ever. Furthermore, in the environment of global logistics and product value chain, to maintain competitive advantage for the companies, outsourcing is an essential part of strategic planning, which must be adjusted along with the external environment and internal conditions. This study constructs a systematic and quantitative multi-attribute decision analysis model, which combines the methodologies from Sislian and Satir (2000) and Platts (2003) to proceed the two-stage decision-making procedure in strategic and tactical aspects. Then, group discussions and Delphi method are applied to establish a comprehensive and objective decision factors. Finally, the analytic hierarchy process (AHP) is implemented to determine the optimal outsourcing decision for the cutting process. Other related technology industries can also apply or modify the decision factors/indexes of this study based on their industry characteristics as their outsourcing decision reference.