The use of data envelopment analysis to monitor hotel productivity

Abstract

Data envelopment analysis (DEA) was used to monitor and benchmark productivity in a chain of 15 hotels over a 12-month period. Quarter results were compared with each other and with standard accounting data for the same period. In this way it was possible to identify and study units which showed anomalous behavour in terms of their measured productivity and gross profit. These were apparently related to factors other than size or staffing levels. Advantages and disadvantages of DEA are discussed, as well as its potential for the motivation and appraisal of local management and for optimizing budgetary control. © 1997 John Wiley & Sons, Ltd.