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Establishing The Most Influencing Causes Of Companies’ Financial Health And Performance – A Grey Fuzzy Approach

Author

Listed:
  • Emil Scarlat
  • Virginia Mărăcine
  • Camelia Delcea

    (Bucharest University of Economics Faculty of Economic Cybernetics, Statistics and Informatics Bucharest, Romania)

Abstract

The core of our paperwork consists in construction of a model for determining a hierarchy of qualitative and quantitative causes that are influencing service companies’ financial health. While the quantitative causes are objectively measurable, the qualitative causes are mainly subjectively measurable, quantified based on some experts’ opinion. In order to reduce the degree of subjectivity, we took advantage of methods offered by fuzzy systems, mainly in construction of the expertons. Expertons are in fact intervals built using the ϕ-fuzzy sub-set and the opinion of several experts over a certain problem. Furthermore, after constructing the expertons, we use the methods offered by grey systems theory and fuzzy sub-sets arithmetic to determine the degree of influence of each qualitative and quantitative cause on company’s performance. By classifying the causes and acting on the most important of them, the activity of the analyst can be really improved and the company’s performance will rise.

Suggested Citation

  • Emil Scarlat & Virginia Mărăcine & Camelia Delcea, 2010. "Establishing The Most Influencing Causes Of Companies’ Financial Health And Performance – A Grey Fuzzy Approach," Annals of University of Craiova - Economic Sciences Series, University of Craiova, Faculty of Economics and Business Administration, vol. 1(38), pages 237-248, May.
  • Handle: RePEc:aio:aucsse:v:1:y:2010:i:11:p:237-248
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    More about this item

    Keywords

    service companies; fuzzy sets; grey systems theory; fuzzy sub-sets arithmetic; financial health;

    JEL classification:

    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis

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