Integrating the data envelopment analysis and the balanced scorecard approaches for enhanced performance assessment

Amado, Carla; Santos, Sérgio Pereira dos; Marques, P.

http://hdl.handle.net/10400.1/3804

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Authors

Amado, Carla

Santos, Sérgio Pereira dos

Marques, P.

Abstract(s)

This article presents the development of a conceptual framework which aims to assess Decision Making Units (DMUs)from multiple perspectives. The proposed conceptual framework combines the Balanced Scorecard(BSC)method with the non-parametric technique known as Data Envelopment Analysis (DEA) by using various interconnected models which try to encapsulate four perspectives of performance (financial, customers, internal processes,learning and growth). The practical relevance of the conceptual model has been tested by using it to assess the performance of DMUs in a multinational company which operates in two business areas.Various models were developed with the collaboration of the directors of the company in order to conceive an appropriate and consensual framework, which may provide useful information for the company.The application of the conceptual framework provides structured information regarding the performance of each DMU(from multiple perspectives)and ways to improve it.By integrating the BSC and the DEA approaches this research helps to identify where there is room for improving organisational performance and points out opportunities for reciprocal learning between DMUs.In doing so,this article provides a set of recommendations relating to the successful application of DEA and its integration with the BSC,in order to promote a continuous learning process and to bring about improvements in performance.