Development of Dynamic Data Envelopment Analysis Models and their Applications in Some Real life Problems

Abstract

Performance evaluation is vital for assessing the effectiveness of decision-making units (DMUs) such as banks, educational institutions, hospitals, airlines, etc., to determine the benchmarks and develop strategies for the improvement of underperforming units. Among all available techniques, data envelopment analysis (DEA) is found to be widely used technique for performance evaluation and ranking. DEA is a linear programming-based non-parametric technique for measuring relative efficiencies of homogeneous DMUs in terms of multiple inputsoutputs. It has been further extended to network DEA to incorporate internal structures of DMUs wherein a DMU is divided into different divisions based on their operations/functions. However, the DEA and network DEA models measure efficiency statically and lack in considering the interrelationships of periods. Dynamic DEA offers a more realistic framework by considering the interactions between periods, making it an emerging and crucial field. The development of models plays a significant role in the evolution of dynamic DEA, which is essential for incorporating dynamic factors and complex network structures to perform accurate efficiency analysis and recommend possible improvement paths. Moreover, the data for variables like customer satisfaction, environmental pollution and employees involved in different operations of a bank are not known precisely but need to be incorporated effectively in the production process while efficiency assessment. In view of the above observations, this research work extends the DEA to dynamic DEA by incorporating the dynamic effects of carryovers, different network structures and addressing imprecision in the data. It presents dynamic DEA models to evaluate technical, cost, and revenue efficiencies and demonstrates their applicability to real-world problems, in particular, the banking sector, providing a more comprehensive approach to performance assessment. The chapter-wise summary of the thesis is as follows: Chapter 1 of the thesis presents an o