DEA cross‐efficiency aggregation based on preference structure and acceptability analysis

Abstract

Abstract Although a considerable amount of efforts have been made to overcome the drawbacks of traditional equal aggregation in the Data Envelopment Analysis cross‐efficiency evaluation, the endogenous preference structures in the cross‐efficiency matrix are still largely unexplored. We first untangle both preferential differences denoting the preference degrees among different Decision Making Unit (DMU), and preferential priorities denoting the favorite ranking of the DMUs. A revised cross‐efficiency matrix is formulated. We then apply the stochastic multicriteria acceptability analysis for group decision‐making method to obtain a set of holistic acceptability indices corresponding to different DMUs. Finally, we develop a satisfaction index to evaluate the satisfactory level of the proposed method. Two numerical examples with respect to the Flexible Manufacturing System selection problem and industrial robot selection problem are conducted to validate the proposed methodology. The superiority of our methodology is manifested in terms of an improvement of the overall satisfactory level as 18.69% and 8.48%, respectively.