Benchmarking is a strategic management tool that can help to gain competitive
advantage, but the question is how to decide the relevant practice exemplars
to be used as role models. Data Envelopment Analysis (DEA) is a very helpful
method for tracking corresponding benchmarks, but the question remains of
how to record them when performance is fluctuating and unstable, as is the
case in a transition period to an open market. To address this issue a new
DEA-based tool is proposed, the Corresponding Benchmark Matrix (CBM), which
helps to reveal ?leader? countries and the most suitable benchmarks for less
successful countries. The approach is illustrated for telecommunications in
22 European Bank for Reconstruction and Development (EBRD) countries.
Research question: This paper introduces a new parameter for evaluating the sensitivity of development paths in ELECTRE (ELimination Et Choix Traduisant la Realité) based stepwise benchmarking model. Motivation: The aim of the research was to devise a 'path sensitivity coefficient' which measures the sensitivity of a development path depending on parameters set by decision-maker (DM). The need for such measure comes from the fact that the hierarchical pre-order of benchmarking units are affected by the DM's subjective decisions on the threshold for declaring outranking relations among them. This consequently may disrupt the sequence of intermediate benchmarks - transitional targets to be followed on the route to the ultimate policy goals. The proposed approach is an extension of a stepwise benchmarking procedure devised by Petrovic et al. (2014) which evaluates development paths based on their gradualism. Idea: In this paper, we propose to characterize development paths by considering both gradualism and sensitivity to outranking thresholds. The standpoint of our research is that in order to make a reliable final choice the DM should be aware that the most gradual path is not necessary the most stable one. Tools: The proposed 'path sensitivity coefficient' combines four level of uncertainty coming from two threshold values set by DM. The coefficient has a relative nature, it points to the “distance” from the theoretically ideal solution - a path fully indifferent to threshold values. An approach to merge coefficients associated with gradualism and stability is also introduced. Data: To illustrate the proposed approach we applied it in the field of digital transformation of EU countries. We exploited indicators and data from Digital Agenda Scoreboard regarding specific policy goals to be achieved until 2020. Findings: The findings imply that the decision on the most gradual development path should be reconsidered in regards to the influence of model parameters. The final choice depends whether DM’s prefers the smoothness of the path or the overall stability in terms of underlying partial preorder. Contribution: This work contributes to the existing ELECTRE-based stepwise benchmarking by reducing the uncertainty coming from subjective parameterization and allows the DM to be more confident in the final path selection.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.