Abstract
Efficiency evaluations based on DEA are often associated with external benchmarking, usually requiring an expressive sample of comparable firms and access to sensitive information. However, some organizations present unique characteristics that make it challenging to find appropriate comparators. The literature often neglects the possibility of using DEA within an organization when comparable units are not available. In this context, internal benchmarking is a promising alternative that enables conducting relative efficiency assessments by introducing the time dimension in the assessment of a single firm. This chapter provides a literature review of internal longitudinal benchmarking assessments conducted with DEA. The applications in different sectors are explored, and the conditions under which the use of DEA for internal benchmarking is appropriate are analyzed. The main contributions and limitations of this approach are discussed.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
References
Anand, G., & Kodali, R. (2008). Benchmarking the benchmarking models. Benchmarking: An International Journal.
Aparicio, J., Pastor, J. T., Vidal, F., & Zofío, J. L. (2017). Evaluating productive performance: A new approach based on the product-mix problem consistent with data envelopment analysis. Omega, 67, 134–144.
Azizi, R., Matin, R. K., & Amin, G. R. (2016). A ratio-based method for ranking production units in profit efficiency measurement. Mathematical Sciences, 10(4), 211–217.
Banker, R. D. (1984). Estimating most productive scale size using data envelopment analysis. European Journal of Operational Research, 17(1), 35–44.
Banker, R. D., Charnes, A., & Cooper, W. W. (1984). Some models for estimating technical and scale inefficiencies in data envelopment analysis. Management Science, 30(9), 1078–1092.
Barbosa, L. M., Lacerda, D. P., Piran, F. A. S., & Dresch, A. (2017). Exploratory analysis of the variables prevailing on the effects of product modularization on production volume and efficiency. International Journal of Production Economics, 193, 677–690. https://doi.org/10.1016/j.ijpe.2017.08.028.
Baviera-Puig, A., Baviera, T., Buitrago-Vera, J., & Escribá-Pérez, C. (2020). Internal benchmarking in retailing with DEA and GIS: The case of a loyalty-oriented supermarket chain. Journal of Business Economics and Management, 21(4), 1035–1057. https://doi.org/10.3846/jbem.2020.12393.
Camp, R. C., & Camp Robert, C. (1989). Benchmarking: The search for industry best practices that lead to superior performance. WI: Quality Press Milwaukee.
Carpinetti, L. C., & De Melo, A. M. (2002). What to benchmark? A systematic approach and cases. Benchmarking: An International Journal.
Charnes, A., Cooper, W. W., & Rhodes, E. (1978). Measuring the efficiency of decision making units. European Journal of Operational Research, 2(6), 429–444.
Claro, D. P., & Kamakura, W. A. (2017). Identifying sales performance gaps with internal benchmarking. Journal of Retailing, 93(4), 401–419. https://doi.org/10.1016/j.jretai.2017.08.001.
Cox, J. R. W., Mann, L., & Samson, D. (1997). Benchmarking as a mixed metaphor: Disentangling assumptions of competition and collaboration. Journal of Management Studies, 34(2), 285–314. https://doi.org/10.1111/1467-6486.00052.
de Souza, I. G., Lacerda, D. P., Camargo, L. F. R., Dresch, A., & Piran, F. A. S. (2018a). Efficiency and internal benchmark on an armament company. Benchmarking: An International Journal, 25(7), 2018–2039. https://doi.org/10.1108/bij-08-2016-0128, https://doi.org/10.1108%2Fbij-08-2016-0128.
de Souza, I. G., Lacerda, D. P., Camargo, L. F. R., Dresch, A., & Piran, F. S. (2018). Do the improvement programs really matter? An analysis using data envelopment analysis. BRQ Business Research Quarterly, 21(4), 225–237. https://doi.org/10.1016/j.brq.2018.08.002, https://doi.org/10.1016%2Fj.brq.2018.08.002.
Ermel, A. P. C., Lacerda, D. P., Morandi, M. I. W. M., & Gauss, L. (2021). Systematic literature review. In: Literature Reviews (pp. 19–30). Springer International Publishing. https://doi.org/10.1007/978-3-030-75722-9_3.
Fong, S. W., Cheng, E. W., & Ho, D. C. (1998). Benchmarking: A general reading for management practitioners. Management Decision, 36(6), 407–418. https://doi.org/10.1108/00251749810223646.
Førsund, F. R. (2018). Economic interpretations of DEA. Socio-Economic Planning Sciences, 61, 9–15.
Färe, R., Grosskopf, S., & Lovell, C. A. K. (1985). The Measurement of Efficiency of Production (Vol. 6). Netherlands: Springer. https://doi.org/10.1007/978-94-015-7721-2.
Gilsa, C. V., Lacerda, D. P., Camargo, L. F. R., Souza, I. G., & Cassel, R. A. (2017). Longitudinal evaluation of efficiency in a petrochemical company. Benchmarking: An International Journal, 24(7), 1786–1813. https://doi.org/10.1108/bij-03-2016-0044
Gong, S., Shao, C., & Zhu, L. (2019). Multi-level and multi-granularity energy efficiency diagnosis scheme for ethylene production process. Energy, 170, 1151–1169. https://doi.org/10.1016/j.energy.2018.12.203.
Hyland, P., & Beckett, R. (2002). Learning to compete: The value of internal benchmarking. Benchmarking: An International Journal, 9(3), 293–304. https://doi.org/10.1108/14635770210429036.
Joo, S. J., Stoeberl, P. A., Kwon, I. W. G. (2007). Benchmarking efficiencies and strategies for resale operations of a charity organization. Benchmarking: An International Journal, 14(4), 455–464. https://doi.org/10.1108/14635770710761861.
Joo, S. J., Stoeberl, P. A., & Fitzer, K. (2009). Measuring and benchmarking the performance of coffee stores for retail operations. Benchmarking: An International Journal, 16(6), 741–753. https://doi.org/10.1108/14635770911000088, https://doi.org/10.1108%2F14635770911000088
Joo, S. J., Keebler, J. S., & Hanks, S. (2013). Measuring the longitudinal performance of 3pl branch operations. Benchmarking: An International Journal, 20(2), 251–262. https://doi.org/10.1108/14635771311307704, https://doi.org/10.1108%2F14635771311307704.
Joo, S. J., Stoeberl, P. A., Liao, K., & Ke, K. (2017). Measuring the comparative performance of branches of a credit union for internal benchmarking. Benchmarking: An International Journal, 24(6):1663–1674, https://doi.org/10.1108/bij-03-2016-0029, https://doi.org/10.1108%2Fbij-03-2016-0029.
Kaffash, S., Azizi, R., Huang, Y., & Zhu, J. (2020). A survey of data envelopment analysis applications in the insurance industry 1993–2018. European Journal of Operational Research, 284(3), 801–813. https://doi.org/10.1016/j.ejor.2019.07.034.
Kang, C. C. (2010). Liberalization policy, production and cost efficiency in Taiwan’s telecommunications industry. Telematics and Informatics, 27(1), 79–89. https://doi.org/10.1016/j.tele.2009.05.004.
Kenessey, Z. (1987). The primary, secondary, tertiary and quaternary sectors of the economy. Review of Income and Wealth, 33(4), 359–385. https://doi.org/10.1111/j.1475-4991.1987.tb00680.x, https://doi.org/10.1111%2Fj.1475-4991.1987.tb00680.x.
Kerstens, K., Sadeghi, J., & Van de Woestyne, I. (2019). Convex and nonconvex input-oriented technical and economic capacity measures: An empirical comparison. European Journal of Operational Research, 276(2), 699–709.
Kuosmanen, T., Cherchye, L., & Sipiläinen, T. (2006). The law of one price in data envelopment analysis: Restricting weight flexibility across firms. European Journal of Operational Research, 170(3), 735–757.
Lampe, H. W., & Hilgers, D. (2015). Trajectories of efficiency measurement: A bibliometric analysis of DEA and SFA. European Journal of Operational Research, 240(1), 1–21.
Liu, J. S., Lu, L. Y., & Lu, W. M. (2016). Research fronts in data envelopment analysis. Omega, 58, 33–45.
Moriarty, J. P., & Smallman, C. (2009). En route to a theory of benchmarking. Benchmarking: An International Journal.
O’Neal, T., Min, H., Cherobini, D., & Joo, S. J. (2020). Benchmarking aircraft maintenance performances using data envelopment analysis. International Journal of Quality & Reliability Management, 38(6), 1328–1341. https://doi.org/10.1108/ijqrm-05-2020-0157. https://doi.org/10.1108%2Fijqrm-05-2020-0157
Park, K. S., & Cho, J. W. (2011). Pro-efficiency: Data speak more than technical efficiency. European Journal of Operational Research, 215(1), 301–308.
Piran, F. A. S., Lacerda, D. P., Camargo, L. F. R., Viero, C. F., Dresch, A., & Cauchick-Miguel, P. A. (2016). Product modularization and effects on efficiency: An analysis of a bus manufacturer using data envelopment analysis (DEA). International Journal of Production Economics, 182, 1–13, https://doi.org/10.1016/j.ijpe.2016.08.008, https://doi.org/10.1016%2Fj.ijpe.2016.08.008.
Piran, F. A. S., Lacerda, D. P., Camargo, L. F. R., & Dresch, A. (2020). Effects of product modularity on productivity: An analysis using data envelopment analysis and malmquist index. Research in Engineering Design, 31(2), 143–156, https://doi.org/10.1007/s00163-019-00327-3, https://doi.org/10.1007%2Fs00163-019-00327-3.
Piran, F. A. S., Paris, A. D., Lacerda, D. P., Camargo, L. F. R., Serrano, R., & Cassel, R. A. (2020). Overall equipment effectiveness: Required but not enough—An analysis integrating overall equipment effect and data envelopment analysis. Global Journal of Flexible Systems Management, 21(2), 191–206. https://doi.org/10.1007/s40171-020-00238-6, https://doi.org/10.1007%2Fs40171-020-00238-6.
Piran, F. S., Lacerda, D. P., Camanho, A. S., & Silva, M. C. (2021). Internal benchmarking to assess the cost efficiency of a broiler production system combining data envelopment analysis and throughput accounting. International Journal of Production Economics, 238, 108173.
Portela, M. C. A. S., Thanassoulis, E., Horncastle, A., & Maugg, T. (2011). Productivity change in the water industry in england and wales: Application of the meta-malmquist index. Journal of the Operational Research Society, 62(12), 2173–2188. https://doi.org/10.1057/jors.2011.17, https://doi.org/10.1057%2Fjors.2011.17.
Roets, B., & Christiaens, J. (2015). Evaluation of railway traffic control efficiency and its determinants. European Journal of Transport and Infrastructure Research, 15(4).
Siok, M. F., & Tian, J. (2011). Benchmarking embedded software development project performance. In IEEE 13th International Symposium on High-Assurance Systems Engineering. IEEE. https://doi.org/10.1109/hase.2011.59, https://doi.org/10.1109%2Fhase.2011.59.
Southard, P. B., & Parente, D. H. (2007). A model for internal benchmarking: When and how? Benchmarking: An International Journal, 14(2), 161–171. https://doi.org/10.1108/14635770710740369, https://doi.org/10.1108%2F14635770710740369
Sueyoshi, T. (1991). Estimation of stochastic frontier cost function using data envelopment analysis: An application to the AT &t divestiture. Journal of the Operational Research Society, 42(6), 463–477. https://doi.org/10.1057/jors.1991.95, https://doi.org/10.1057%2Fjors.1991.95.
Telles, E. S., Lacerda, D. P., Morandi, M. I. W. M., & Piran, F. A. S. (2020). Drum-buffer-rope in an engineering-to-order system: An analysis of an aerospace manufacturer using data envelopment analysis (DEA). International Journal of Production Economics, 222, 107500. https://doi.org/10.1016/j.ijpe.2019.09.021, https://doi.org/10.1016%2Fj.ijpe.2019.09.021.
Tone, K., & Sahoo, B. K. (2005). Evaluating cost efficiency and returns to scale in the life insurance corporation of India using data envelopment analysis. Socio-Economic Planning Sciences, 39(4), 261–285. https://doi.org/10.1016/j.seps.2004.06.001, https://doi.org/10.1016%2Fj.seps.2004.06.001.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2023 The Author(s), under exclusive license to Springer Nature Switzerland AG
About this chapter
Cite this chapter
Piran, F.S., Camanho, A.S., Silva, M.C., Lacerda, D.P. (2023). Internal Benchmarking for Efficiency Evaluations Using Data Envelopment Analysis: A Review of Applications and Directions for Future Research. In: Macedo, P., Moutinho, V., Madaleno, M. (eds) Advanced Mathematical Methods for Economic Efficiency Analysis. Lecture Notes in Economics and Mathematical Systems, vol 692. Springer, Cham. https://doi.org/10.1007/978-3-031-29583-6_9
Download citation
DOI: https://doi.org/10.1007/978-3-031-29583-6_9
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-031-29582-9
Online ISBN: 978-3-031-29583-6
eBook Packages: Economics and FinanceEconomics and Finance (R0)