An Integrated Slacks-Based Measure of Super-Efficiency with Input Saving and Output Surplus Scaling Factors and its Application in Paper Chemical Mills

Abstract

Data envelopment analysis (DEA) as a nonparametric programming approach has been widely extended and applied in many areas. Conventional DEA models can well measure the efficiency of inefficient decision-making units (DMUs) but cannot further discriminate the efficient DMUs. A lot of methods are proposed to address this problem. One of the most important methods is the slacks-based measure of super-efficiency model (S-SBM model) developed by Tone in 2002. However, the projection for a DMU on the efficient frontier identified by S-SBM model may not be strongly Pareto-efficient that makes the super-efficiency score misestimated. This paper revises the usual slacks-based measure of super-efficiency by incorporating input saving and output surplus scaling factors into the objection function for measuring DMUs. We integrate SBM model and S-SBM model effectively and yield input saving and output surplus scaling factors as well as input and output slacks under only one integrated model. According to the study, the projection reference point identified by our method is strongly Pareto-efficient. Meanwhile, how each decision variable influences the efficiency score for a specific DMU is revealed and illustrated through two numerical examples and an empirical study in paper chemical mills.