Benchmarking—A Way of Finding Risk Factors in Business Performance

Abstract

The purpose of this study was to emphasize that the Data Envelopment Analysis (DEA) method is an important benchmarking tool which provides necessary information for improving business performance. To fulfil the abovementioned goal, we used a sample of 48 Slovak companies involved in the field of heat supply. As their position in the economic and social environment of the country is essential, considerable attention should be paid to improving their performance. In addition to the DEA method, we applied the Best Value Method (BVM). We found that DEA is a highly important benchmarking tool, as it provides benchmarks for units that have problems with performance and helps us to reveal risk performance factors. The DEA method also allows us to determine target values of indicators. The originality of this paper is in its comparison of the results of the BVM and the DEA methods.

A Framework for Short- vs. Long-Term Risk Indicators for Outsourcing Potential for Enterprises Participating in Global Value Chains: Evidence from Western Balkan Countries

“…Since most long-term debt is made of loans from the financial sector, the mechanism can quickly produce an effect on the sector, resulting in a high level of nonperforming loans (Horvathova et al 2021). The subindustries that show the highest level of long-term risks include those in the materials industry, including both materials and engineering with 82% of enterprises, metals and mining with 71% of enterprises, and household durables with 51% of enterprises.…”

“…These enterprises have the opportunity to improve their outsourcing potential if they keep strong margins and asset turnover, and in this way decrease leverage without sacrificing profitability. As the values of financial ratios used to understand liquidity management are below benchmarking levels, it clearly indicates that the majority of enterprises have in-place poor cash management strategies, revealing short-term threats that might have implications in the long-term operability due to low solvency and high leverage (Horvathova et al 2021).…”

“…Identification of potential outsourcing partners undergoes a thorough evaluation that includes, among others, the financial performance of enterprises. Similar to underlying research from McKinsey, Organization for Economic Co-operation and Development (OECD), United Nations Conference on Trade and Development (UNC-TAD) (Horvathova et al 2021), this paper considers the financial performance as a key determinant for outsourcing in global value chains, with particular focus on the trade-off between the short-and long-term financial risks (Brochet et al 2015;OECD 2020;Lund et al 2020;and Kasasbeh 2021).…”

RTA Dubai: Benchmarking as a Catalyst for Superior Services

“…• It is a process that requires discipline, time and cost, According to Horváthová, Mokrišová, and Vrábliková (2021), multiple benchmarking strategies exist that businesses can use. RTA has exhibited process and performance benchmarking characteristics by disclosing its methodologies and procedures inprojectplanning, design, and execution.…”

Performance measuring of wood-processing microenterprises through Data Envelopment Analysis: A case study of Slovakia, Poland, and Bulgaria

“…Other authors like Dia et al (2020), Neves et al (2020), and Qayyum and Riaz (2018) used DEA for benchmarking and performance measurement in the banking sector in various ways, which proved the applicability of this approach. Horváthová et al (2021) used DEA for benchmarking and performance measurement to provide necessary information for improving business performance. The current study provides an assessment through DEA efficiency scores of wood-processing micro-enterprises in Slovakia, Poland and Bulgaria and indicates the efficiency targets by comparing these three countries with the EU levels of efficiency as a benchmark.…”