Title: Hybrid methods for ranking DMUs that combine performance and improvement trend over successive periods

Authors: Yossi Hadad; Baruch Keren; Michael Z. Hanani

Addresses: Department of Industrial Engineering and Management, SCE – Shamoon College of Engineering, Bialik/Basel Sts. P.O. Box 45, Beer Sheva 84100, Israel ' Department of Industrial Engineering and Management, SCE – Shamoon College of Engineering, Bialik/Basel Sts. P.O. Box 45, Beer Sheva 84100, Israel ' Department of Industrial Engineering and Management, SCE – Shamoon College of Engineering, Bialik/Basel Sts. P.O. Box 45, Beer Sheva 84100, Israel

Abstract: The paper proposes two methods that rank business units (e.g., ports, hubs and restaurants) not only by their performance functions values at certain points in time, but also by the derivatives of the performance functions, i.e., by trends. Two hybrid methods for fully ranking of decision making units (DMUs), where each DMU has multiple inputs and multiple outputs are proposed. The methods combine the performance and the improvement trend over successive periods into one index. The first method, DEA/AHP, is an extension of a known method and is based on two common methodologies - data envelopment analysis (DEA) and analytical hierarchical process (AHP). The second hybrid method DEA/Malmquist ranks DMUs by computing the average relative efficiency and the geometric mean of the Malmquist index. The applicability of the proposed methods is demonstrated for a real-life case study with ten fast-food hamburger restaurants.

Keywords: performance measurement; data envelopment analysis; DEA; Malmquist productivity index; MPI; analytical hierarchical process; AHP; DMU ranking; decision making units; business units; fast food restaurants; hamburger restaurants.

DOI: 10.1504/IJLSM.2013.056751

International Journal of Logistics Systems and Management, 2013 Vol.16 No.3, pp.269 - 287

Published online: 26 Dec 2013 *

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