A major super market retailer chain wants to apply Data Envelopment Analysis in order to assess its efficiency. The following inputs are identified for the analysis. 11. Facility costs (100,000 $) 12. Employee costs (10,000 $) 13. Floor space (1,000 m) The average quality score obtained for each quality dimension will be used as inputs to the analysis. On the other hand, the outputs will be: 01. Net profit as a percentage of sales (%) 02. Number of customers per day (100) The table below summarizes the input and output data for each store: Store Service Inputs 12 13 11 1 2 3 4 5 6 5,19 4,29 5,36 5,04 5,32 5,05 4,76 5,11 5,15 5,39 5,56 5,37 5,44 7 5,23 4,79 5,33 5,18 5,35 5,18 5,48 5,34 5,22 5,30 5,39 5,32 5,18 5,03 4,53 5,43 5,12 5,35 5,00 5,19 5,15 5,18 5,35 5,15 5,44 5,24 Service Outputs 01 02 5,83 3,04 4,17 4,11 5,83 3,45 5,83 3,29 4,17 3,59 8,33 3,04 5,00 3,63 3,33 2,83 8,97 3,62 7,50 3,14 5,83 3,10 5,83 3,17 10,00 2,81 8 9 10 11 12 13 1. Write the DEA model (LP model) for Store 1. 2. Using Excel Solver, solve the DEA model for each store and identify efficient and inefficient stores. (Do not forget to select "Assume Linear Model" or "Simplex LP" in the Excel solver). 3. For each inefficient store a identify the appropriate reference set of efficient stores, b. discuss in which ways each store can achieve efficiency score of 1 (in terms of reducing just facility costs by ... amount, reducing just employee costs by ... amount, reducing just floor space by ... amount, or...) c. identify the composite service unit (in terms of inputs used and outputs produced), d. provide the excess amounts of inputs used and make suggestions for improvement. A major super market retailer chain wants to apply Data Envelopment Analysis in order to assess its efficiency. The following inputs are identified for the analysis. 11. Facility costs (100,000 $) 12. Employee costs (10,000 $) 13. Floor space (1,000 m) The average quality score obtained for each quality dimension will be used as inputs to the analysis. On the other hand, the outputs will be: 01. Net profit as a percentage of sales (%) 02. Number of customers per day (100) The table below summarizes the input and output data for each store: Store Service Inputs 12 13 11 1 2 3 4 5 6 5,19 4,29 5,36 5,04 5,32 5,05 4,76 5,11 5,15 5,39 5,56 5,37 5,44 7 5,23 4,79 5,33 5,18 5,35 5,18 5,48 5,34 5,22 5,30 5,39 5,32 5,18 5,03 4,53 5,43 5,12 5,35 5,00 5,19 5,15 5,18 5,35 5,15 5,44 5,24 Service Outputs 01 02 5,83 3,04 4,17 4,11 5,83 3,45 5,83 3,29 4,17 3,59 8,33 3,04 5,00 3,63 3,33 2,83 8,97 3,62 7,50 3,14 5,83 3,10 5,83 3,17 10,00 2,81 8 9 10 11 12 13 1. Write the DEA model (LP model) for Store 1. 2. Using Excel Solver, solve the DEA model for each store and identify efficient and inefficient stores. (Do not forget to select "Assume Linear Model" or "Simplex LP" in the Excel solver). 3. For each inefficient store a identify the appropriate reference set of efficient stores, b. discuss in which ways each store can achieve efficiency score of 1 (in terms of reducing just facility costs by ... amount, reducing just employee costs by ... amount, reducing just floor space by ... amount, or...) c. identify the composite service unit (in terms of inputs used and outputs produced), d. provide the excess amounts of inputs used and make suggestions for improvement
