IDEAS home Printed from https://ideas.repec.org/a/abw/journl/y2019id820.html
   My bibliography  Save this article

A Modified Mcdm Algorithm With Cumulative Entropy Weights For Selecting The Winner Of The Tender

Author

Listed:
  • A. O. Matin
  • F. Misagh

Abstract

The aim of this research is to evaluate the proposed bids using impartial and entropy weights in a multi-criteria decision-making model. We use matrix data for hypothetical bidding involving nine criteria, with the presence of four domestic and two foreign contractors. Then, using cumulative entropy function, we estimate the entropy weights and use it in a multi-criteria decision-making model. The criteria of experience and knowledge in the field, good history and satisfaction in previous projects, financial and support capabilities, localization of the contractor, having the experience at the site of the project, availability and readiness of equipment and machines, the adequacy of technical staff, the work quality system, the efficient management and appropriate management system, creativity and innovation in similar tasks are the input variables of the decision model. After analyzing them, the proposals are prioritized through a multi-criteria decision-making model. The research findings include Shannon entropy and cumulative entropy-based weights for evaluation criteria and after applying the specific weight for the proposed quotation, the utility rate of each contractor is calculated. The results showed that the use of modified multi-dimensional decision-making method is more advantageous than traditional methods of evaluating bidding proposals in selecting the winner of a tender, and also using cumulative entropy weights in comparison with Shannon's leads to a more realistic choice of contractors.

Suggested Citation

  • A. O. Matin & F. Misagh, 2019. "A Modified Mcdm Algorithm With Cumulative Entropy Weights For Selecting The Winner Of The Tender," Strategic decisions and risk management, Real Economy Publishing House, vol. 10(1).
  • Handle: RePEc:abw:journl:y:2019:id:820
    DOI: 10.17747/2618-947X-2019-1-46-51
    as

    Download full text from publisher

    File URL: https://www.jsdrm.ru/jour/article/viewFile/820/728
    Download Restriction: no

    File URL: https://www.jsdrm.ru/jour/article/viewFile/820/739
    Download Restriction: no

    File URL: https://libkey.io/10.17747/2618-947X-2019-1-46-51?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Farsam Misagh, 2016. "On Shift-Dependent Cumulative Entropy Measures," International Journal of Mathematics and Mathematical Sciences, Hindawi, vol. 2016, pages 1-8, June.
    2. Charnes, A. & Cooper, W. W. & Huang, Z. M. & Sun, D. B., 1990. "Polyhedral Cone-Ratio DEA Models with an illustrative application to large commercial banks," Journal of Econometrics, Elsevier, vol. 46(1-2), pages 73-91.
    3. Yang, Jiping & Qiu, Wanhua, 2005. "A measure of risk and a decision-making model based on expected utility and entropy," European Journal of Operational Research, Elsevier, vol. 164(3), pages 792-799, August.
    4. Diakoulaki, D & Mavrotas, G & Papayannakis, L, 1992. "A multicriteria approach for evaluating the performance of industrial firms," Omega, Elsevier, vol. 20(4), pages 467-474, July.
    5. Boussofiane, A. & Dyson, R. G. & Thanassoulis, E., 1991. "Applied data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 52(1), pages 1-15, May.
    6. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    7. Smith, P, 1990. "Data envelopment analysis applied to financial statements," Omega, Elsevier, vol. 18(2), pages 131-138.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Barros, Carlos Pestana & Peypoch, Nicolas, 2008. "Technical efficiency of thermoelectric power plants," Energy Economics, Elsevier, vol. 30(6), pages 3118-3127, November.
    2. Tone, Kaoru & Sahoo, Biresh K., 2005. "Evaluating cost efficiency and returns to scale in the Life Insurance Corporation of India using data envelopment analysis," Socio-Economic Planning Sciences, Elsevier, vol. 39(4), pages 261-285, December.
    3. Eskelinen, Juha & Halme, Merja & Kallio, Markku, 2014. "Bank branch sales evaluation using extended value efficiency analysis," European Journal of Operational Research, Elsevier, vol. 232(3), pages 654-663.
    4. Shang, Jen & Sueyoshi, Toshiyuki, 1995. "A unified framework for the selection of a Flexible Manufacturing System," European Journal of Operational Research, Elsevier, vol. 85(2), pages 297-315, September.
    5. Beasley, J. E., 2003. "Allocating fixed costs and resources via data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 147(1), pages 198-216, May.
    6. Yan, Hong & Wei, Quanling & Hao, Gang, 2002. "DEA models for resource reallocation and production input/output estimation," European Journal of Operational Research, Elsevier, vol. 136(1), pages 19-31, January.
    7. C. Lovell & Shawna Grosskopf & Eduardo Ley & Jesús Pastor & Diego Prior & Philippe Eeckaut, 1994. "Linear programming approaches to the measurement and analysis of productive efficiency," TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, Springer;Sociedad de Estadística e Investigación Operativa, vol. 2(2), pages 175-248, December.
    8. Dyson, R. G. & Allen, R. & Camanho, A. S. & Podinovski, V. V. & Sarrico, C. S. & Shale, E. A., 2001. "Pitfalls and protocols in DEA," European Journal of Operational Research, Elsevier, vol. 132(2), pages 245-259, July.
    9. Carlos Pestana Barros & Maria Teresa Medeiros Garcia, 2006. "Performance Evaluation of Pension Funds Management Companies with Data Envelopment Analysis," Risk Management and Insurance Review, American Risk and Insurance Association, vol. 9(2), pages 165-188, September.
    10. Arzum Buyukkeklik & Harun Dumlu & Samet Evci, 2016. "Measuring the Efficiency of Turkish SMEs: A Data Envelopment Analysis Approach," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 8(6), pages 190-190, June.
    11. Simon de Blas, Clara & Simon Martin, Jose & Gomez Gonzalez, Daniel, 2018. "Combined social networks and data envelopment analysis for ranking," European Journal of Operational Research, Elsevier, vol. 266(3), pages 990-999.
    12. Seufert, Juergen Heinz & Arjomandi, Amir & Dakpo, K. Hervé, 2017. "Evaluating airline operational performance: A Luenberger-Hicks-Moorsteen productivity indicator," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 104(C), pages 52-68.
    13. H-T Lin, 2011. "Efficiency analysis of chain stores: a case study," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 62(7), pages 1268-1281, July.
    14. Førsund, Finn, 2015. "Economic Perspectives on DEA," Memorandum 10/2015, Oslo University, Department of Economics.
    15. Francisco Pedraja & Javier Salinas & Peter Smith, 1994. "La restricción de las ponderaciones en el análisis envolvente de datos: una fórmula para mejorar la evaluación de la eficiencia," Investigaciones Economicas, Fundación SEPI, vol. 18(2), pages 365-380, May.
    16. Adel Hatami-Marbini & Zahra Ghelej Beigi & Hirofumi Fukuyama & Kobra Gholami, 2015. "Modeling Centralized Resources Allocation and Target Setting in Imprecise Data Envelopment Analysis," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 14(06), pages 1189-1213, November.
    17. Isidoro Guzmán & Stephen Morrow, 2007. "Measuring efficiency and productivity in professional football teams: evidence from the English Premier League," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 15(4), pages 309-328, November.
    18. Sebastian Kohl & Jan Schoenfelder & Andreas Fügener & Jens O. Brunner, 2019. "The use of Data Envelopment Analysis (DEA) in healthcare with a focus on hospitals," Health Care Management Science, Springer, vol. 22(2), pages 245-286, June.
    19. Jie Wu & Zhixiang Zhou, 2015. "A mixed-objective integer DEA model," Annals of Operations Research, Springer, vol. 228(1), pages 81-95, May.
    20. Berger, Allen N. & Humphrey, David B., 1997. "Efficiency of financial institutions: International survey and directions for future research," European Journal of Operational Research, Elsevier, vol. 98(2), pages 175-212, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:abw:journl:y:2019:id:820. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ООО Ð˜Ð·Ð´Ð°Ñ‚ÐµÐ»ÑŒÑ ÐºÐ¸Ð¹ дом Â«Ð ÐµÐ°Ð»ÑŒÐ½Ð°Ñ Ñ ÐºÐ¾Ð½Ð¾Ð¼Ð¸ÐºÐ°Â» (email available below). General contact details of provider: https://www.jsdrm.ru/jour/about/journalSponsorship .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.