Title: Performance measurement using data envelopment analysis and financial statement analysis

Authors: Chien-Ta Bruce Ho

Addresses: Institute of Electronic Commerce, National Chung Hsing University, 250, Kuo Kuang Road, Taichung 402, Taiwan

Abstract: This paper is an analysis of performance measurement in some of Taiwan|s electronic companies. Most previous studies concerning company performance measurement focus merely on operational efficiency. Operational effectiveness, however, which might directly influence the survival of a company, is usually ignored. This paper constructs a conceptual framework, based on the Financial Statement Analysis (FSA), to define the meaning of performance. Also, this paper presents a study, which uses an innovative two-stage Data Envelopment Analysis (DEA) model that separates efficiency and effectiveness to evaluate the performance of 59 listed corporations of the electronic industry in Taiwan. The empirical results indicate that a company with a better efficiency does not always have better effectiveness. There is no apparent correlation between these two indicators.

Keywords: performance measurement; data envelopment analysis; DEA; financial statement analysis; FSA; operational research; Taiwan; electronics industry; operational effectiveness.

DOI: 10.1504/IJOR.2007.011441

International Journal of Operational Research, 2007 Vol.2 No.1, pp.26 - 38

Published online: 30 Nov 2006 *

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