Evaluation of environmentally conscious manufacturing programs using a three-hybrid multi-criteria decision analysis method

Abstract

Environmental management, being an important component in strategies for achieving sustainable development of processes and products, has emerged as a proactive approach in majority of the manufacturing organizations. From the strategic perspective environmentally conscious manufacturing (ECM) programs lead to better environmental management practice. The objective of the current paper is to present an integrated and holistic framework to evaluate ECM programs. This framework combines three multi-criteria decision analysis (MCDA) methods to consider eight major environmentally conscious manufacturing indicators (ECMI) in order to identify the efficiency of each ECM program. First the interdependence relationship among the ECMIs is established using decision-making trail and evaluation laboratory (DEMATEL). Then a range of weightage (i.e. upper and lower bounds) is created for each ECMI using analytic network process (ANP) to include managerial preferences. Finally, this range of weightage for each indicator is applied to perform restricted multiplier data envelopment analysis (RMDEA). Results show that the technical efficiency of the inefficient ECM programs for integrated RMDEA, on average, is calculated as 53.2% whereas traditional input oriented DEA provides the same score as 72.3%. This clearly indicates that integrated RMDEA is better than the input oriented DEA because same level of output could be produced with lesser resources if the ECM programs perform on the frontier. Hence, the advantage of this methodology is that the managerial preferences are successfully implemented through this newly developed hybrid methodology that will help to reduce less resource consumption and lead to better environmental policy.