Manager perceptions of decision-making for evaluation indicators: a centralized data envelopment analysis based approach

Abstract

Purpose This paper aims to propose an integrated centralized data envelopment analysis (CDEA)-balanced scorecard (BSC) model to provide a selective approach to determine the most efficient indicators for evaluating the four perspectives of the BSC. Design/methodology/approach An integer linear programming model based on the efficiency concept of the CDEA method is presented to select the best indicators for evaluating four perspectives of the BSC. The basis for selecting indicators in this method is to maximize the overall performance of each BSC perspective. The modeling is performed on a real case. The considered model is solved using a general algebraic modeling system software for the data set of the real case. Findings A real-world case is solved using the proposed method. The integration of the CDEA and the BSC seems to be advantageous because it sheds more light on the complexity and tradeoffs inherent in actual performance measurement. It is important to note that there cannot be a unique and universal model of performance measurement applicable in every situation, in every organization and at any time. Research limitations/implications The data set of a single organization in the manufacturing industry is used to show the performance of the proposed mathematical model; therefore, generalization of the results should be done cautiously. This framework is based on the Iranian community and experts’ viewpoints; therefore, different results may be obtained if it is applied elsewhere, and the importance of perspectives and their indicators might show different results in other populations and other countries. In addition, because the data is collected in a specific period of time, the results cannot be extended to other periods of time. Originality/value The main contribution of this paper lies in the adaption of a new integrated CDEA-BSC model to performance measurement in the industrial sector that technology improves the ultimate results of performance measurement and provides wider opportunities for decision-makers. This paper aids managers and decision-makers to control the efficient indicators in perspectives.