Optimization modeling for estimating and enhancing relative efficiency with application to industrial companies

Data Envelopment Analysis (DEA) is a special optimization model used to assess and compare the comparative efficiency of organizational units where the presence of multiple inputs and outputs makes comparisons difficult. The aim of this paper is to evaluate the operational efficiency of manufacturing organizations in the context of a developing country and to apply a modified model of DEA for eliminating inefficiencies by imposing realistic limits on input and output factors. Actual data on 55 manufacturing organizations in Jordan were obtained for this purpose. Extensive interviews and discussions were conducted to get details on how the DEA results were accepted by the companies studied and the changes they produced if any.