An Network DEA approach to assessing radial efficiency measures of supply chains: A scenario-based study

The performance evaluation of the supply chain gives insights to the managers about multilayered internal linking activities and multiple entities. Data Envelopment Analysis (DEA) has been used to evaluate the performance of supply chains. However, the traditional DEA models cannot consider the linking activities of supply chains in the performance evaluation. Network DEA (NDEA) models can compute the efficiency measure of multi-stage processes like supply chains. Several network DEA models using radial efficiency measures have been proposed by different authors, while they did not consider the different roles of links (intermediates) in the overall efficiency measure. This paper provides some radial NDEA models in which the intermediates are involved in the overall efficiency measure under different situations. To this end, the current paper considers six scenarios related to the concept of the link control approach by different members of the supply chain. The proposed NDEA models using radial efficiency provide the efficiency measure that is easy to interpret and simple for inefficient DMUs to learn from it. The provided approach provides the target links associated with each scenario. It can be seen that in the noncooperative methods target link value cannot be determined uniquely. A case study demonstrates the applicability of the proposed models.

Keywords:

Data Envelopment Analysis(DEA) , Radial efficiency measure , Noncooperative system , Cooperative system