A new bi-level data envelopment analysis model for efficiency measurement and target setting

Seyed Hossein Razavi Hajiagha; Hannan Amoozad Mahdiraji; Madjid Tavana

doi:10.1016/j.measurement.2019.106877

A new bi-level data envelopment analysis model for efficiency measurement and target setting

Seyed Hossein Razavi Hajiagha
, Hannan Amoozad Mahdiraji
, Madjid Tavana

Research output: Contribution to journal › Article › peer-review

11 Citations (Scopus)

153 Downloads (Pure)

Abstract

Data envelopment analysis (DEA) is a well-known and widely used method for performance evaluation in a set of homogeneous units. We propose a new bi-level DEA model for efficiency measurement and target setting. The fundamental novelty of the proposed model is threefold. We: (1) set both efficiency and profit concurrently as targets; (2) limit the amount of changes in the inputs and outputs to prevent unachievable targets; and (3) predict some targets for efficient units beyond the inefficient ones. We present a case study in the banking industry to demonstrate the efficacy of efficiency measurement and target setting in the proposed models.

Original language	English
Article number	106877
Journal	Measurement: Journal of the International Measurement Confederation
Volume	147
Early online date	31 Jul 2019
DOIs	https://doi.org/10.1016/j.measurement.2019.106877
Publication status	Published - 1 Dec 2019
Externally published	Yes

Funding

The authors would like to thank the anonymous reviewers and the editor for their insightful comments and suggestions. Dr. Madjid Tavana is grateful for the partial support he received from the Czech Science Foundation (GAˇCR19-13946S) for this research.

Keywords

Benchmarking
Bi-level programming
Data envelopment analysis
Efficiency planning
Target setting

ASJC Scopus subject areas

Instrumentation
Electrical and Electronic Engineering

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10.1016/j.measurement.2019.106877

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Cite this

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AB - Data envelopment analysis (DEA) is a well-known and widely used method for performance evaluation in a set of homogeneous units. We propose a new bi-level DEA model for efficiency measurement and target setting. The fundamental novelty of the proposed model is threefold. We: (1) set both efficiency and profit concurrently as targets; (2) limit the amount of changes in the inputs and outputs to prevent unachievable targets; and (3) predict some targets for efficient units beyond the inefficient ones. We present a case study in the banking industry to demonstrate the efficacy of efficiency measurement and target setting in the proposed models.

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KW - Efficiency planning

KW - Target setting

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A new bi-level data envelopment analysis model for efficiency measurement and target setting

Abstract

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Keywords

ASJC Scopus subject areas

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