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Efficiency Analysis of Supply Chain Processes

International Journal of Production Research, Vol. 44, No. 23, pp. 5065-5087, December 2006

23 Pages Posted: 27 Dec 2007  

Gerald Reiner

Vienna University of Economics and Business Administration - Department of Information Systems and Operations

Paul Hofmann

Saffron Technology; MIT, Cambridge; SAP Labs

Abstract

We present an integrated benchmarking approach. To analyse the performance of inter-organizational (supply chain) processes at company level we combine dependency analysis and data envelopment analysis (DEA). DEA has been proven to be a powerful tool for benchmarking processes and for identifying the most efficient ones. Before using DEA analysis the inputs and outputs as well as the relevant dependencies have to be identified. To support the determination of input and output variables we propose to use dependency analysis. We illustrate the application of this integrated approach by analysing the results of an empirical benchmarking study of 65 European and North American companies. The study shows that make-to-stock is still the predominating manufacturing strategy of the analysed industries. Therefore, we utilize different DEA models with weight restrictions only for companies with a make-to-stock strategy. The results support our basic hypotheses that efficient supply chains lead to high financial performance. Furthermore they indicate improvement potential for the benchmarked supply chain processes

Keywords: Supply chain performance measurement, Benchmarking,TETRAD, DEA, productivity analysis

JEL Classification: D23, C11, C44

Suggested Citation

Reiner, Gerald and Hofmann, Paul, Efficiency Analysis of Supply Chain Processes. International Journal of Production Research, Vol. 44, No. 23, pp. 5065-5087, December 2006. Available at SSRN: https://ssrn.com/abstract=1078585

Gerald Reiner

Vienna University of Economics and Business Administration - Department of Information Systems and Operations ( email )

Welthandelsplatz 1
Vienna, Wien 1020
Austria

Paul Hofmann (Contact Author)

Saffron Technology ( email )

United States

MIT, Cambridge ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

SAP Labs ( email )

Palo Alto, CA 94304
United States
4084970101 (Phone)

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