Resource allocation and target setting based on virtual profit improvement


One application of Data Envelopment Analysis (DEA) is the resource allocation and target setting among homogeneous Decision Making Units (DMUs). In this paper, we assume that all units are under the supervision and control of a central decision making unit, for instance chain stores, banks, schools, etc. The aim is to allocate available resources among units in a way that the so-called organisational overall ”virtual profit” is maximized. Our method is highly flexible in decision making to achieve the goals of the Decision Maker (DM). The resulting production plans maintain the following characteristics: (1) the virtual profit of each unit is calculated with a common set of weights; (2) the selected weights for calculating the virtual profit prevent the virtual profit of the system from getting worse; (3) the virtual profits of less profitable units are improved as much as possible. The proposed method is illustrated with a simple numerical example and a real life application.

Publication DOI:
Divisions: Aston Business School > Operations & Information Management
Aston Business School
Additional Information: Jafar Sadeghi, Mojtaba Ghiyasi, Akram Dehnokhalaji. Resource allocation and target setting based on virtual profit improvement. Numerical Algebra, Control & Optimization, doi: 10.3934/naco.2019043
Full Text Link:
Related URLs: http://www.aims ... 34/naco.2019043 (Publisher URL)
PURE Output Type: Article
Published Date: 2019-10-01
Accepted Date: 2019-07-09
Authors: Sadeghi, Jafar
Ghiyasi, Mojtaba
Dehnokhalaji, Akram (ORCID Profile 0000-0002-2751-0719)



Version: Accepted Version

| Preview

Export / Share Citation


Additional statistics for this record