ANALYSIS OF THE EFFICIENCY AND EFFECTIVENESS OF THE MUNICIPALITY-OWNED PUBLIC BUS TRANSPORT SERVICE ENTERPRISE IN ADDIS ABABA, ETHIOPIA

Abstract

To make decisions and exercise managerial control over the degree of input utilization, and produce desired outputs, it is important to assess the efficiency and effectiveness of the municipality-owned public transit service operators. This study uses the Data Envelopment Analysis approach to assess the efficiency and effectiveness of the public transit companies operated by the city administration in Addis Ababa. The size of the fleet and the total number of personnel serve as inputs, and covered vehicle kilometers and the number of passengers carried annually serve as outputs. Based on secondary information gathered from each firm, the technical efficiency and operational effectiveness of service providers are then examined. The study's findings show that the Anbessa city bus was efficient in using resources to produce output in 2019/20 and 2021/22, but wasteful in other years. In the same way, the Sheger City Bus was efficient in 2017/18 and 2021/22 but ineffective in all other years. However, the aggregate findings show that both research's efficiency levels are rising annually. Besides, with mean scores of 0.85 and 0.874, respectively, Anbessa and Sheger Bus were technically flawed. On the other side, operational effectiveness reveals that the Anbessa city bus was only effective in 2021/22. Furthermore, the Sheger city bus' effectiveness result has improved and started to be effective in 2017/18, 2018/19, and 2021/22. In conclusion, the Anbessa and Sheger city buses' efficiency and effectiveness ratings improved year over year and peaked in 2021/22. Hence, to support the business and boost its operational capabilities, the city administration should encourage public bus transit operators in the city and offer subsidies and other incentives to them based on their existing performance.