A cone-ratio data envelopment analysis approach for advanced manufacturing technology justification

Evaluation and selection of advanced manufacturing technology (AMT) is a complex decision making process which requires careful consideration of various performance criteria. Initially, the decision-maker must identify a feasible set of AMT candidates, which broadly meet the budget constraints and system requirements. The competitive priorities (cost, time, quality, and flexibility) must then be set and matched against the performance variables in identifying preference relationships. The final step involves the evaluation of alternative systems based on performance criteria and preference relationships. This paper depicts the AMT selection process through an IDEF0 functional model. It utilizes a combination of a cone-ratio data envelopment analysis, which integrates decision-maker's preferences, and a new methodological extension in data envelopment anaylsis. The applicability of the proposed model is illustrated by using a real data set of industrial robots.