Introduction to Performance Improvement Management Software (PIM-DEA) Emrouznejad A. and E. Thanassoulis In the “Handbook of Research on Strategic Performance Management and Measurement Using Data Envelopment Analysis”: 256-275. IGI Global, USA.
Emrouznejad A. and E. Thanassoulis (2015). Introduction to Performance Improvement Management Software (PIM-DEA), in Osman et al. (Eds.) Handbook of Research on Strategic Performance Management and Measurement Using Data Envelopment Analysis: 256-275. IGI Global, USA.
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Introduction to Performance Improvement Management Software (PIM-DEA) Ali Emrouznejad Operations and Information Management Group, Aston Business School, Aston University Birmingham B4 7ET, United Kingdom,
[email protected]
Emmanuel Thanassoulis Operations and Information Management Group, Aston Business School, Aston University Birmingham B4 7ET, United Kingdom,
[email protected] ABSTRACT This chapter provides information on the use of Performance Improvement Management Software (PIM-DEA1). This advanced DEA software enables you to make the best possible analysis of your data, using the latest theoretical developments in Data Envelopment Analysis (DEA). PIM-DEA software gives you the capacity to assess efficiency and productivity, set targets, identify benchmarks and much more allowing you to truly manage the performance of organizational units. PIM-DEA is easy to use and powerful and it has an extensive range of the most up-to-date DEA models and which can handle large sets of data.
Keywords: DEA Software, Performance Improvement Management, Data Envelopment Analysis
INTRODUCTION With PIM-DEA, you can easily handle most tasks such as:
Assessment of units under constant or variable returns to scale;
Assessment of units under non-increasing or non-decreasing returns to scale;
Assessment of units with restrictions on the input /output weights;
Estimate performance targets with varying priorities over the improvement of inputs and outputs;
Assess some units when some variables are exogenously fixed and returns to scale are variable;
Assess the super efficiency of units, including automated identification of units above a userspecified efficiency threshold, their removal and re-assessment of the remaining units;
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For latest information please see: www.DEAsoftware.co.uk
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Identify whether increasing, constant or decreasing returns to scale hold locally for units efficient under variable returns to scale;
Compute Malmquist productivity indices and their decomposition into boundary shift and efficiency catch-up. Boundary shift can be identified both under constant and variable returns to scale;
Compute Cross-efficiency matrices using optimal weights of selected units to compute the efficiencies of other selected units;
Compute bootstrapping interval;
and many more.
With PIM-DEA you can produce a variety of results including:
Tables of efficiencies;
Tables of Pareto efficient input-output levels for assessed units;
Tables of benchmark (efficient) units for each inefficient unit to emulate;
Tables of input - output weights to estimate their marginal rates of cross substitution;
Summary statistics (mean, variance, maximum, minimum etc) of efficiencies;
Production Possibility Set (PPS) charts for visual assessment when the number of inputs and outputs permits it.
All reported results can be:
Exported directly into Excel, Word, PDF, HTML format;
All graphs can be saved as images.
PIM-DEA can handle large sets of data including:
The use of Excel to import data;
The use of categorical variables to select subsets of units to be assessed by a given DEA model in batch mode;
Multiple DEA models can be set up, involving different input and output variables from a global data set to be executed in batch mode.
The rest of this chapter is an overview of the PIM-DEA software that has been extracted from its manual (Emrouznejad and Thanassoulis 2011)
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(see also http://deasoftware.co.uk for the latest
version of the PIM-DEA features and its Manual).
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See http://www.deasoftware.co.uk/license/PIMManual.pdf
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INSTALLATION OF PIM-DEA PIM-DEA is easy to install on any computer with Windows and both 32-bit and 64-bit operating systems are supported. With this book you will get a free version of PIM-DEA software for evaluation purposes. With this version, you are able to analysis DEA models including CCR and BCC for up to 20 DMUs. Malmquist index and its decomposition for two consecutive periods are also made available in this version. For full details of this offer and downloading steps please visit “http://www.deasoftware.co.uk/bookoffer/SPMM ”3.
STARTING PIM-DEA FOR THE FIRST TIME This section shows you how to start the software once it has been installed. The steps involved are:
Creating a data set for a PIM-DEA Project;
Creating one or more DEA models within a PIM-DEA project;
Running one or more DEA models and viewing the results;
Saving a project and your data and/or exporting your results.
These steps are explained below. You can also watch a set of videos which show you how to open PIM-DEA for the first time, read your data in, create a model and run PIM. These videos are available via PIM-DEA menu, select “Help>How do I” as follows:
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(a) The evaluation period is for limited time only, (b) PIM Ltd has also provided a discount code for readers of this book, so at any time up to the end of your evaluation period you will have an option to upgrade to full version without any time limitation with a 10% discount, please see terms and condition at http://www.deasoftware.co.uk/bookoffer/SPMM, (c) The discount code will be send to your email once you register to download the trial version. (d) PIM Ltd will not provide any support to users of the evaluation version and this offer may be withdrawn at any time without notice.
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Figure 1. PIM-DEA, help menu (Source: PIM-DEA Manual)
CREATING A DATA SET FOR A PIM-DEA PROJECT Preparing your data in an Excel file Importing your data from Excel is possibly the most practical method. If you wish to use this option you need to have first prepared a suitable Excel file containing your data so that PIM-DEA can read the file. An example of an Excel dataset with 2 periods is as follows containing three sheets: Main, Period1 and Period2.
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Figure 2. PIM-DEA, DMU description (Source: PIM-DEA Manual) Data in the Main sheet contains the names of the DMUs, the column “A” needs to be headed ‘DMU’. The names of the DMUs need to be alphanumeric starting with a letter. Symbols such as $, #, etc are not permitted. The descriptions of the DMUs are free format. Categorical variables, if any, can be listed in column “C” and after.
The data in the sheets labelled period lists the DMUs and their corresponding input-output data values E.g. See the illustrations below. Data in the sheet period 1
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Figure 3. PIM-DEA, Excel data file format for each period (Source: PIM-DEA Manual)
Data in the sheet period 2
Figure 4. PIM-DEA, Excel data file format for each period (Source: PIM-DEA Manual)
Note that the names of the sheets are free. You do need not name them as ‘Main’, ‘Period1’ etc.
CREATING A PROJECT WITHIN PIM-DEA FROM IMPORTED DATA Once you have created a suitable Excel file, to read it into PIM-DEA and create a project you will need to click 'File', then 'New' and then in the pop up menu below select ‘Import from Excel’.
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Figure 5. PIM-DEA, import data file from Excel (Source: PIM-DEA Manual)
Once you have found your data file a table of the following format will appear, depending on the sheets your Excel file contains. You need to indicate which is the ‘main sheet’ containing the names of the DMUs and the sheets containing data values, as illustrated below.
Figure 6. PIM-DEA, selecting datasheets when importing excel data file (Source: PIM-DEA Manual)
Once you have identified the main and data sheets click ‘finish’. The data will then be imported and you can view your data by time period as illustrated below.
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Figure 7. PIM-DEA, data file view (Source: PIM-DEA Manual)
You can now start to specify one or more DEA models to analyze the data you have imported.
PRODUCING A GRAPH OF THE PRODUCTION POSSIBILITY SET This section shows you how to produce and style a graph of the Production Possibility Set (PPS). The PPS can only be drawn where at most three input-output variables in total are involved. To create a PPS graph, double click PPS in ‘Project Explorer’ and a screen as the one illustrated below will appear.
Figure 8. PIM-DEA, setting PPS chart (Source: PIM-DEA Manual)
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This offers you a number of options for the graph. Firstly under ‘Data Set’, you can specify whether you wish to draw one input against a single output (labelled Output vs. Input) or a graph for two inputs against one output or the other way round. You can only draw the latter two types of graphs involving three variables under CRS. You need to specify whether the technology is CRS or VRS (BCC) and then specify the input and output variables you wish to plot. The graph will appear as illustrated below.
An example of CRS boundary with single input / single output:
Figure 9. PIM-DEA, an example of a CCR PPS chart (Source: PIM-DEA Manual) An example of VRS boundary with single input / single output is shown below.
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Figure 10. PIM-DEA, an example of BCC PPS chart (Source: PIM-DEA Manual) If you wish to track a specific DMU within the PPS you can specify the DMU concerned as ‘active’. If your data involves more than one period and you wish to see the boundary shift you can specify the two periods of data concerned as in the screenshot below. Note the unit as it changes location between the two periods concerned.
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Figure 11. PIM-DEA, an example of 2 periods PPS chart (Source: PIM-DEA Manual)
There is also a number of options available for customization of the graph. Under Appearance within the PPS Chart menu you can adapt the appearance of the chart according to your own preferences. You can choose the colours you wish to use and specify whether DMU labels should be on display or not and if so whether all DMUs should appear or just those on the efficient boundary. There are also two other buttons; Change Axes Properties and Change Series Properties which allow you to adapt the graph further.
CREATING A MODEL This section shows you how to create DEA models within your PIM-DEA project. To create a new model you will need to go to the top level menu 'Models' in the project explorer, then click “add new model...” as illustrated below.
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Figure 12. PIM-DEA, adding a new DEA model (Source: PIM-DEA Manual) This will produce a pop up screen asking you to type a name for the new model, once you have entered your chosen name, it will automatically show up on the project explorer. At the same time to the right there will appear the ‘Model Toolbar’ giving you control to specify the model as is next illustrated.
Individual Model Toolbar The model toolbar has the sub-menus depicted below.
Figure 13. PIM-DEA, setting DEA models options (Source: PIM-DEA Manual) You will need to choose the properties of your model within each sub-menu. To familiarize yourself with the available options in each sub-menu please read the manual.
Running the model Once all your relevant data and model choices have been specified the simple way to run your model is to click on the play button icon (
) on the toolbar above your model information.
VIEWING AND MANIPULATING THE RESULTS Your model results can be viewed by clicking on the expand icon ( ) next to the model name in the project explorer. This will then show the drop down menu for that individual model, illustrated below.
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Figure 14. PIM-DEA, browsing results of selected DEA model (Source: PIM-DEA Manual)
Summary This shows a clear overview of the choices you made before the model was built and run.
Efficiency
The efficiency results are split into three; the main efficiency, the efficiency trend where panel data is involved, and then the efficiency plot, all showing the same results in different ways. You are able to display the efficiencies by period and if you have specified subsets of DMUs either through selection lists or categorical variables you can also explore the results by selection or category of DMUs. You can specify the number of decimal places for the results under ‘precision’.
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Figure 15. PIM-DEA, a sample table of efficiency scores (Source: PIM-DEA Manual)
Efficiency Trend
This is a graphical representation of the efficiency trends between the periods where they exist. For example you can see the efficiencies in periods 1 and 2 as in the illustration below.
Figure 16. PIM-DEA, a sample plot of efficiency (Source: PIM-DEA Manual)
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Efficiency Plot The efficiency plot is a bar chart of the efficiencies of the DMUs. An example is shown below.
Figure 17. PIM-DEA, a sample histogram of efficiency (Source: PIM-DEA Manual) Lambdas In this section you are able to see the lambda values for each of the individual DMUs switching by period, selection, category and number of decimal places (precision). (The lambdas relate to the envelopment version of the DEA model).
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Figure 18. PIM-DEA, a sample table of lambdas (Source: PIM-DEA Manual)
Peers This section of results shows the efficient referents (benchmarks) for each of the individual DMUs. This allows the user to see which DMUs can be used as role models for an inefficient DMU. For example DMU H01 in the illustration below has H02 and H03 as efficient referents (peers). (The performance of H01 is inferior relative to those of H02 and H03.)
Figure 19. PIM-DEA, a sample report of peers (Source: PIM-DEA Manual)
Targets This window looks at the individual DMUs and their targets which would allow them to gain full efficiency.
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Figure 20. PIM-DEA, a sample table of target values for input/output variables (Source: PIM-DEA Manual) Slacks These are the values of the variables corresponding to the slack variables in the envelopment model. The variables show the scope for improving input and output values after the changes in input and output levels corresponding to the optimal value of the objective function.
Figure 21. PIM-DEA, a sample table of slacks (Source: PIM-DEA Manual)
Weights This is related to the weight restrictions of your model if there are any and shows them in relation to each of the individual DMUs. It should be noted that the optimal weights for a DMU are not usually unique.
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Figure 22. PIM-DEA, a sample table of weights (Source: PIM-DEA Manual)
Cross Efficiencies The cross efficiency of a DMU (j) is computed as the ratio of the sum of its weighted outputs to the sum of its weighted inputs using the weights that are optimal for some other DMU (k). Doyle and Green (1994) introduced the concept of cross efficiency grounding it on the intuitive concept of peerappraisal, DMU k appraising DMU j in the above example as opposed to self-appraisal represented by the traditional DEA efficiency rating.
Figure 23. PIM-DEA, a sample table of cross efficiencies (Source: PIM-DEA Manual)
In the illustration above H01 weights yield efficiencies of 64.25%, 100%, 100%, 71.26%, 47.33% and 64.58% to DMUs H01 to H06 respectively. Thus note how H02 is efficient under the weights optimal for all other DMUs whereas H03 is very inefficient under the optimal weights for H02. (However, as noted elsewhere the optimal weights of a DMU, especially so for an efficient one such as H02 may not be unique.) DMU Summary
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This section provides a summary of all DMUs and their performance. It pulls together all of the results from the targets, slacks and weights as well as plotting them on a chart making the results easy to read and print. This really is the summary page if you wish to quickly and easily view your results.
Figure 24. PIM-DEA, a sample summary report for a selected DMU (Source: PIM-DEA Manual)
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Figure 25. PIM-DEA, a sample summary report of actual and target values for a selected DMU (Source: PIM-DEA Manual) In this section we have only provided with essential information that you can get from a simple model, for full details we refer you to the manual in which you can see all model options as well as results you will get from the PIM-DEA software.
CONCLUSION Performance Improvement Management Software (PIM-DEA) is an advanced DEA software that enables users to make the best possible analysis of their data, using the latest theoretical developments in Data Envelopment Analysis (DEA). This chapter provided information on the use of PIM-DEA, further details can be found at http://www.DEAsoftware.co.uk.
REFERENCES Charnes, A., Cooper, W. W. and Rhodes, E. (1978), Measuring the efficiency of decision making units, European Journal of Operations Research, 2 (6), 429-44. Doyle J.R. and R.H. Green (1994), “Efficiency and Cross Efficiency in DEA - Derivations, Meanings and Uses”, Journal of the Operational Research Society, 45 (5) 567-578. Emrouznejad A, B. R. Parker, G. Tavares (2008), Evaluation of research in efficiency and productivity: a survey and analysis of the first 30 years of scholarly literature in DEA, SocioEconomic Planning Sciences; 42: 151–157. Emrouznejad, A. and De Witte, K. (2010), COOPER-framework: A unified process for nonparametric projects. European Journal of Operational Research 207: 1573–1586. Emrouznejad, A. and E. Thanassoulis (2011), Performance Improvement Management Software: PIM-DEAsoft-V3.0 User Guide, ISBN: 978-1-85449-412-2. Thanassoulis E, (2001), Introduction to the theory and application of Data Envelopment Analysis: A foundation text with integrated software, Kluwer. Thanassoulis E, Portela M.C.A.S. and Allen R. (2004) Incorporating value judgements in DEA. Cooper W. W, Seiford L. W. and Zhu J. Editors Handbook on Data Envelopment Analysis ISBN 1 40207797 1 (Kluwer Academic Publishers.) Thanassoulis E., Portela Maria C. S., and Despić O. (2008) DEA – The Mathematical Programming Approach to Efficiency Analysis, in The Measurement of Productive Efficiency and Productivity Growth, (Hal Fried, Knox Lovell and Shelton Schmidt editors) Oxford University Press.
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