Pitfalls of decomposition weights in the additive multi-stage DEA model

Ang, Sheng; Chen, Chien‐Ming

doi:10.1016/j.omega.2015.05.008

Cited by 81 publications

(25 citation statements)

References 39 publications

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“…About the specification of decomposition weights, many works (e.g., Cook et al [36]) chose the endogenous weights that define the weights w p as the virtual inputs (outputs) of stage p divided by total virtual inputs (outputs), representing the relative importance or contribution of the performance of each stage, respectively, to the overall performance of the DMU in the whole process. However, Ang and Chen [37] found that these endogenous weights implied that upstream stages (regardless the stage efficiency scores) in the model would obtain higher priority in efficiency decomposition, which meant that the earlier stages would obtain higher decomposition weights and have a greater influence on the overall efficiency. In the two-stage model, for example, this means that the decomposition weight of the first stage will be at least as high as 0.5.…”

Section: Methodsmentioning

confidence: 99%

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Sustainability Evaluation of Railways in China Using a Two-Stage Network DEA Model with Undesirable Outputs and Shared Resources

Zhou

Han-hui

2017

Sustainability

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This paper constructs an additive two-stage network DEA (data envelopment analysis) model with consideration of undesirable outputs and shared inputs. Following the triple bottom line standard of sustainability, we calculate both the overall and sub-stage sustainability performance of railway transportation in China from 2002 to 2013, from the aspects of economy, environment and society. The results show that the overall sustainability of China's railway presents a character of first declining, then rising and declining again. Moreover, the railway sustainability of China's eastern areas are much better than that of the western and central areas, and the gap has become much larger since 2009. As for the sub-stage efficiency, neither the production stage nor the service stage of the railway is efficient in sustainability, and the efficiency of the production stage is lower than that of service stage and plays a greater impact on the overall sustainability. Therefore, in order to improve the overall sustainability of China's railways, it is essential to improve the level of railway engineering construction and develop technological innovations in railway production.

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Section: Methodsmentioning

confidence: 99%

“…To solve Equation (6), we adopt Ang and Chen's method [37]. In the first step, we calculate the bounds for the optimal efficiency scores of two stages.…”

Section: Definition 2 the Stage K Sub-dmu Is Said To Be Efficient Ifmentioning

confidence: 99%

Sustainability Evaluation of Railways in China Using a Two-Stage Network DEA Model with Undesirable Outputs and Shared Resources

Zhou

Han-hui

2017

Sustainability

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“…Chen's model has the drawback that biased toward the second stage (Despotis, Koronakos, & Sotiros, 2016). A new approach to estimate the unique and unbiased efficiency scores for the individual stages is developed by Despotis et al (2016) and is extended by Ang and Chen (2016). Their work indicates the interference of weights with the estimated stage efficiencies and OE.…”

Section: Application Of Dea In Measuring Sez Performancesmentioning

confidence: 99%

The effect of special economic zones on governance performance and their spillover effects in Chinese provinces

Kuo

Nguyen

et al. 2020

Manage Decis Econ

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“…Kao (2014) summarised a wide range of network DEA studies that were based on problems identified and the models that have been developed and applied to them. The most recent studies with regard to network DEA focus on the stage weights applied in the model, and their impact in determining stage and overall efficiencies (Ang & Chen, 2016;Despotis, 2016;Guo, Shureshjani, Foroughi & Zhu, 2016). These studies reveal an emphasis on refinements in the theory, whereas the purpose here is to review existing network DEA applications in order to determine their usefulness in performance measurement systems for support units within businesses.…”

Section: Data Envelopment Analysis In Performance Measurementmentioning

confidence: 99%

Finance Function Performance Measurement-A Data Envelopment Analysis Approach

Migiro

Shewell

2018

JEBS

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The practice of measuring performance of the finance function as a business support unit is not widespread. This study assessed the importance of measuring finance function performance, by ascertaining whether such measurement facilitates identification of the relative efficiency of business finance functions, and by establishing its impact, if any, on overall company performance. Focussing on a sample of companies in the South African Freight Forwarding industry, a performance metric was developed and implemented to measure finance function performance. Relative finance function efficiency was then evaluated using inputorientated data envelopment analysis (DEA) to identify â€˜best in classâ€™ performance and to benchmark participantsâ€™ performance. Further, value chain DEA (VC-DEA) was applied to evaluate finance function efficiency simultaneously with overall company efficiency. Results show that implementation of the performance metric together with DEA facilitated the benchmarking of the finance functions of the sample group and the establishment of improvement targets for the finance functions determined as inefficient. In addition, a link between overall company performance and finance function performance in terms of inputs was confirmed; however, this link was not conclusively established as regards finance function performance in terms of outputs. The contribution of the study includes confirmation that implementation of the performance metric together with DEA facilitates the critical evaluation of finance function performance, thus establishing the importance of measuring the performance of the finance functions. In addition, incorporating the use of DEA in a performance framework for the finance function as a business support unit has extended the range of applications of DEA.

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Pitfalls of decomposition weights in the additive multi-stage DEA model

Cited by 81 publications

References 39 publications

Sustainability Evaluation of Railways in China Using a Two-Stage Network DEA Model with Undesirable Outputs and Shared Resources

Sustainability Evaluation of Railways in China Using a Two-Stage Network DEA Model with Undesirable Outputs and Shared Resources

The effect of special economic zones on governance performance and their spillover effects in Chinese provinces

Finance Function Performance Measurement-A Data Envelopment Analysis Approach

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