IDEAS home Printed from https://ideas.repec.org/a/wsi/apjorx/v39y2022i06ns0217595921500408.html
   My bibliography  Save this article

Cross-Efficiency Evaluation Method Taking Management Objectives as Reference Points from Peer Perspective

Author

Listed:
  • Hai-Liu Shi

    (School of Media and Exhibition, Fujian Business University, Fuzhou 350506, P. R. China)

  • Sheng-Qun Chen

    (School of Information Engineering, Fujian Business University, Fuzhou 350108, P. R. China)

  • Ying-Ming Wang

    (Business School, Yango University, Fuzhou 350506, P. R. China)

  • Yan Huang

    (School of Computer and Information Sciences, Fujian Agriculture and Forestry University, Fuzhou 350002, P. R. China)

Abstract

According to the management by objectives (MBO) theory, performance evaluations should take into account the achievement of management objectives (MOs). The most commonly used performance evaluation method — the cross-efficiency evaluation method — seldom considers the role of MOs as a reference point. According to the prospect theory, decision-makers underestimate the benefits that exceed the reference point; they also exaggerate the losses that fall below the reference point. This irrational psychology is more obvious when evaluating the performance evaluation of peers. As such, this paper proposes a cross-efficiency evaluation method based on prospect theory, which takes MOs as a reference point from a peer perspective. First, taking MOs as reference points, a decision-making unit (DMU) chooses a set of weights for each peer, in order to maximize or minimize the prospects of the peer, according to the benevolent or aggressive attitude of the DMU. In order to improve the adaptability of the method, the precise number of MOs is further extended to be an interval number. Finally, the relationship between models, which are based on precise MOs and interval MOs, is illustrated by propositions. Finally, numerical examples are provided to illustrate the applications of the proposed cross-efficiency evaluation method.

Suggested Citation

  • Hai-Liu Shi & Sheng-Qun Chen & Ying-Ming Wang & Yan Huang, 2022. "Cross-Efficiency Evaluation Method Taking Management Objectives as Reference Points from Peer Perspective," Asia-Pacific Journal of Operational Research (APJOR), World Scientific Publishing Co. Pte. Ltd., vol. 39(06), pages 1-26, December.
  • Handle: RePEc:wsi:apjorx:v:39:y:2022:i:06:n:s0217595921500408
    DOI: 10.1142/S0217595921500408
    as

    Download full text from publisher

    File URL: http://www.worldscientific.com/doi/abs/10.1142/S0217595921500408
    Download Restriction: Access to full text is restricted to subscribers

    File URL: https://libkey.io/10.1142/S0217595921500408?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    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:wsi:apjorx:v:39:y:2022:i:06:n:s0217595921500408. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Tai Tone Lim (email available below). General contact details of provider: http://www.worldscinet.com/apjor/apjor.shtml .

    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.