Developing a step-by-step effectiveness assessment model for customer-oriented service organizations

Effectiveness involves more than simple efficiency, which is limited to the production process assessment of peer operational units. Effectiveness incorporates both endogenous and exogenous variables. It is a fundamental driver for the success of an operational unit within a competitive environment in which either the liquidity of money in the market and the customers are considered to be scarce sources, or the New Public Management (NPM) is citizen/customer and goal-oriented. Additionally, with respect to short-run production constraints, the resources available and controllable by the operational units, as well as the legal status, we go beyond the traditional effectiveness assessment techniques by developing a modified or “rational” Quality-driven – Efficiency-adjusted DEA (MQE-DEA) model. This particular model provides a feasible effectiveness attainment path for every disqualified unit in order to meet high-perceived quality and high-efficiency standards. The input-output mix restructuring targets estimated by the original QE-DEA model are provided on a step-by-step basis in order to have realistic managerial implications.