Gradual efficiency improvement through a sequence of targets

Abstract

The goal in efficiency analysis is not only to evaluate a decision-making unit (DMU) performance, but also to find an efficient target which provides information on inputs reduction and outputs increment values that are necessary to remove inefficiencies for each inefficient DMU. In data envelopment analysis (DEA), the target unit is located on the efficient frontier and possibly far from the unit under assessment. Therefore, in practice performance improvement seems to be disappointing or even impossible to achieve in only one step for some inefficient DMUs. In this regard, finding intermediate targets is of great importance in benchmarking literature. In this article, we find a sequence of targets instead of a single target for each inefficient unit. In our method, the intermediate target at each step has three properties: (I) the intermediate targets and the unit under evaluation are all similar in size; (II) efficiency scores are ascending through the sequence of targets; (III) the target unit at each step is close to the special part of the efficient frontier as much as possible. These properties lead to finding a target that is more achievable in real applications.

Publication DOI: https://doi.org/10.1080/01605682.2018.1529723
Divisions: Aston Business School > Operations & Information Management
Aston Business School
Additional Information: This is an Accepted Manuscript of an article published by Taylor & Francis Group in Journal of the Operational Research Society on 4 Mar 2019, available online at: http://www.tandfonline.com/10.1080/01605682.2018.1529723
Uncontrolled Keywords: Data envelopment analysis,gradual improvement,returns to scale,target setting,Management Information Systems,Strategy and Management,Management Science and Operations Research,Marketing
Full Text Link:
Related URLs: https://www.tan ... 82.2018.1529723 (Publisher URL)
http://www.scop ... tnerID=8YFLogxK (Scopus URL)
PURE Output Type: Article
Published Date: 2019-12-02
Published Online Date: 2019-03-04
Accepted Date: 2018-08-22
Authors: Dehnokhalaji, Akram ( 0000-0002-2751-0719)
Soltani, Narges

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