Proposing a new method to introduce the closest target based of inputs to the evaluated unit
Subject Areas : International Journal of Industrial Mathematics
M. Khanmohammadi
1
(Department of Mathematics, Islamshahr Branch, Islamic Azad University, Islamshahr, Tehran, Iran)
وحیده رضایی
2
(Department of Mathematics, Yasooj Branch, Islamic Azad University, Yasooj, Iran)
Keywords: DEA, DMU, Benchmarking, Closest target, Enhanced Russell measure.,
Abstract :
DEA is a nonparametric method for calculating the relative efficiency of a DMU that yields to a reference target for an inefficient DMU. However, it is very hard for inefficient DMUs to be efficient by benchmarking a target DMU which has different inputs. Finding appropriate benchmarks based on the similarity of inputs makes it easier for an inefficient DMU to try to be like its target DMUs. But it is rare to discover a target DMU, which is both the most efficient and similar in inputs, in real situation. Therefore, it is necessary to find the most similar and closest real DMU in terms of inputs on the strong efficiency frontier, which has the highest possible output. In this paper, a combination of the Enhanced Russell model and the additive model is proposed as a new model to improve the efficiency of the inefficient DMUs. The proposed model is applied on a dataset of a large Canadian Bank branches. The target introduced by the proposed method is more practical target for the evaluated unit. The inefficient unit can improve its efficiency more easily by this benchmark.
