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Adding value in supply chains by improving operational efficiency using data envelopment analysis: a case from published data

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  • P. Sunil Dharmapala

Abstract

Data envelopment analysis (DEA) has been used in many studies to measure the efficiency of supply chains. There, the authors primarily used the traditional Charnes-Cooper-Rhodes (CCR) and Banker-Charnes-Cooper (BCC) models to measure relative efficiency of decision-making units in the supply chain, and their main focus was on enhancing the efficiency of inefficient units. In this paper, using the CCR model with intrinsic assurance regions (IAR), we focus on how to make cost savings in a supply chain by projecting inefficient supply units on to the efficient frontier. By analysing suppliers' data already published in the literature, we demonstrate how to add value in the supply chain by improving operational efficiency of inefficient supply units.

Suggested Citation

  • P. Sunil Dharmapala, 2008. "Adding value in supply chains by improving operational efficiency using data envelopment analysis: a case from published data," International Journal of Applied Management Science, Inderscience Enterprises Ltd, vol. 1(2), pages 160-175.
  • Handle: RePEc:ids:injams:v:1:y:2008:i:2:p:160-175
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