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A rational road to effectiveness attainment

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  • Zervopoulos, Panagiotis
  • Vargas, Francisco
  • Cheng, Gang

Abstract

Operational effectiveness goes beyond efficiency while it incorporates exogenous variables, non-controllable by the service units. Effectiveness is a fundamental driver for the success of an operational unit within a competitive environment. In this context, we seek to identify the active units that meet both the high or technical efficiency and the perceived high quality criteria. We also aim to develop a roadmap for effectiveness for every operational unit and we consider the feasibility of the results produced by the effectiveness assessment process in the short run. The target values uncovered by comparative optimization techniques (e.g. Data Envelopment Analysis) for efficiency and effectiveness measurement generally have limited managerial implications due to production constraints, available resources, and legal status. This paper introduces a modified Quality-driven – Efficiency-adjusted Data Envelopment Analysis (MQE-DEA) model to assess effectiveness and provide a step-by-step path to achieve high quality and high efficiency in every operational unit under evaluation. The MQE-DEA model has particular applicability to the effectiveness assessment of homogenous service units in which an inverse relationship underlies the two dimensions of effectiveness embraced in this study (e.g. bank branches, restaurant chain stores, governmental one-stop-shops).

Suggested Citation

  • Zervopoulos, Panagiotis & Vargas, Francisco & Cheng, Gang, 2011. "A rational road to effectiveness attainment," MPRA Paper 31202, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:31202
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    References listed on IDEAS

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    More about this item

    Keywords

    Data Envelopment Analysis (DEA); Context-dependent DEA; Effectiveness; Efficiency; Perceived Quality;
    All these keywords.

    JEL classification:

    • B21 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Microeconomics
    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis

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