Strategy in practice: a quantitative approach to target setting

An extended quality-driven efficiency-adjusted data envelopment analysis (QE-DEA) method is developed to measure the performance of service units. Performance is measured based on efficiency and users’ satisfaction. The extended QE-DEA method identifies as benchmarks only units that are qualified both in efficiency and satisfaction and ensures that all of the units will be qualified in both dimensions of performance when their performance becomes maximal. If there are efficient units which fail to provide satisfactory services, an adjustment procedure is applied to their outputs before the assessment of the units’ performance. Optimal output targets that lead every unit to maximal performance are defined by the extended QE-DEA. The presented expression relaxes the main assumption of the original QE-DEA method that is the fixed weights between original and adjusted outputs. The extended expression is applied to fifty public one-stop shops.