Service Productivity Management Improving Service Performance using
The service economy is now the largest portion of the industrialized world's economic activity. This development has dramatically raised the importance of maximizing productivity excellence in service organizations. The need for productivity excellence ha
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H. David Sherman Northeastern University, U.S.A.
Joe Zhu Worcester Polyteciinic Institute, U.S.A.
Service Productivity IVIanagement Improving Service Performance using DATA ENVELOPMENT ANALYSIS (DEA)
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H. David Sherman Northeastern University Boston, MA, USA
Joe Zhu Worcester Polytechnic Institute Worcester, MA, USA
Library of Congress Control Number: 2006922584 ISBN-10: 0-387-33211-1 (HE)
ISBN-10: 0-387-33231-6 (e-book)
ISBN-13: 978-0387-33211-6 (HE)
ISBN-13: 978-0387-33231-4 (e-book)
Printed on acid-free paper. © 2006 by Springer Science-i-Business Media, LLC All rights reserved. This work may not be translated or copied in whole or in part without the written permission of the publisher (Springer Science + Business Media, LLC, 233 Spring Street, New York, NY 10013, USA), except for brief excerpts in connection with reviews or scholarly analysis. Use in connection with any form of information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now know or hereafter developed is forbidden. The use in this publication of trade names, trademarks, service marks and similar terms, even if the are not identified as such, is not to be taken as an expression of opinion as to whether or not they are subject to proprietary rights. Service Productivity Management is an independent publication and is not affiliated with, nor has it been authorized, sponsored, or otherwise approved by Microsoft Corporation Printed in the United States of America. 9 8 7 6 5 4 3 2 1 springer.com
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Contents
Foreword Preface
xi xv
Chapter 1 Management of Service Organization Productivity 1.1. Introduction 1 1.2. Productivity Defined vis-a-vis Effectiveness and Efficiency 2 1.3. Components of Productivity 4 1.4. Taxonomies of Service Organization 9 1.5. Classification by Characteristics of Institution 13 1.6. Other Dimensions of the Service Business Taxonomy 17 1.7. Service Productivity Management Techniques 24 1.7.1. Standard Cost Systems 25 1.7.2. Comparative Efficiency Analysis 28 1.7.3. Ratio Analysis 29 1.7.4. Profit and Return on Investment Measures 31 1.7.5. Zero-base Budgeting 32 1.7.6. Program Budgeting 35 1.7.7. Best Practice Analysis 36 1.7.8. Data Envelopment Analysis (DEA) 38 1.7.9. Peer Review 39 1.7.10. Management Reviews 39 1.7.11. Activity Analysis 40 1.7.12. Process Analysis 44 1.7.13. Staffing Models 44 1.7.14. Balanced Scorecards (BSC) 45 1.8. Conclusion 47 Chapter 2 Data Envelopment Analysis Explained 2.1. Introduction
49
viii
Contents 2.2. Basic Efficiency Concepts 2.3.Relative Weights and Costs for Inputs and Outputs 2.4. Data Envelopment Analysis 2.4.1. How DEA Works and How to Interpret the Results 2.4.2. The Mathematical Formulations of DEA 2.4.3. Solving Envelopment DEA Model in Spreadsheets 2.4.4. Solving Multiplier DEA Model in Spreadsheets 2.5. Conclusions
51 55 57 57 63 70 85 88
Chapter 3 DEA Concepts for Managers: Applying and Mana
