EFFICACY OF SUPPLIERS PERFORMANCE EVALUATION IN A DYNAMIC BUSINESS ENVIRONMENT USING DATA ENVELOPMENT ANALYSIS (DEA)

Abstract

Supplier performance evaluation plays a vital role in the creating an effective business survival especially in pessimistic business environment. More also, evaluation of supplier performance is important for an enterprise to survive in a competitive local and global market. The study x-rays the benefit of data envelopment analysis in evaluating the performance of decision-making units (DMUs). DEA is a mathematical programming tool applied in performance measurement. A case scenario is presented to show the efficiency of the selected suppliers’ selection and the most competent in ranking order. The DMUs results demonstrated that the model has the capacity to measure effectiveness, efficiency and most preferred supplier for business sustainability in an unstable business environment. The DMUs model can be used by decision makers to select the most efficient and economical business partner (supplier) for business survival.