Selecting material handling equipment through a market weight scheme based DEA cross-efficiency approach

Abstract

ABSTRACT This paper presents a robust tool for ranking MHE prior to selecting the best one. The proposed ranking methodology is based on a new key performance indicator, identified as market weight scheme (MWS). The MWS of each MHE reflects the market’s importance of its performance criteria and it is built through an ingenious integration of the most resonated appreciative (MRA) model with the ordered weighted averaging (OWA) operator. The flexibility of MRA is exploited to customize the weight profiles of the data envelopment analysis (DEA) peer-evaluations, whereas the OWA aggregation process is run to produce the associated MWS for a pre-set decision maker’s (DM) subjective judgment towards the MHE market stability. Thus, the novelty of the present study is threefold. (1) The MHE is selected from a collective market perspective rather than individualistic manufacturer’s viewpoint. (2) The ranking process is based on the aggregation of weight profiles instead of cross-efficiency (CE) scores, as traditionally done in DEA-CE approaches. (3) The DM’s subjectivism is integrated into the assessment process through an optimism measure that mimics the market stability. The application of the proposed methodology on a sample of 27 robots asserts its robustness as a selection tool.