Data Envelopment Analysis to measure relative performance based on key indicators from a supply network with Reverse Logistics

Abstract

Introduction− Data Envelopment Analysis (DEA) is used to measure the relative performance of a series of distribution centers (DCs), using key indicators based on reverse logistics for a company that produces electric and electronic supplies in Colombia. Objective− The aim is to measure the relative performance of distribution centers based on Key Performance Indicators (KPI) from a supply network with reverse logistics. Methodology− A DEA model is applied through 5 steps: KPIs selection; Data collection for all 18 DCs in the network; Build and run the DEA model; Identify the DCs that will be the focus of improvement; Analyze the DCs that restrict or diminish the total performance of the system. Results− KPIs are defined, data is collected and KPI's for each DCs are presented. The DEA model is run and the relative efficiencies for each DCs are determined. A frontier analysis is made and DCs that limit or reduce the performance of the system are analyzed to find options for improving the system. Conclusions− Reverse logistics, brings numerous advantages for companies. The analysis of the indicators allows logistics managers involved to make relevant decisions for higher performance. The DEA model identifies which DCs have a relative superior and inferior performance, making it easier to make informed decisions to change, increase or decrease resources, and activities or apply best practices that optimize the performance of the network. Para citar este artículo: C. Ardila Gamboa y F. Ballesteros Riveros, "Data Envelopment Analysis to measure relative performance based on key indicators from a supply network with reverse logistics"

Performance of Reverse Logistics in Electronic Commerce: A Case Study From Lebanon and Syria

“…REL's has significant benefits when implemented correctly. For instance, REL performance decreases costs and increases profits (Xu et al 2015;Chen et al 2016;Agarwal et al 2016;Ardila Gamboa, Ballesteros Riveros 2018;Euchi et al 2019;Huang et al 2015;Sri Yogi 2015;Han, Trimi 2018;Tosarkani, Amin 2018;Li et al 2018), increases customer satisfaction (Bouzon et al 2015;Pham, Ahammad 2017;Nisar, Prabhakar 2017;Han, Trimi 2018;Huang et al 2015;Mahindroo et al 2018;Vlachos 2016;Panigrahi et al 2018;Da Silveira Guimarães, Salomon 2015) and enhances the efficiency of resources' utilization (Agarwal et al 2016;Sirisawat, Kiatcharoenpol 2018;Vlachos 2016;Sun 2017;Yu, Solvang 2017;Chileshe et al 2018). The main purpose of REL is to maximize the value of returned products (Han, Trimi 2018).…”

“…REL activities include two main classifications and the first is related to returning products from consumers to manufacturers due to bad customer satisfaction, defected goods, or wrong products, whereas the second one is strictly aimed for recycling and recovery purposes (Batarfi et al 2017). REL is a step-by-step process by which the products, materials, and miscellaneous resources are assembled from consumers to get them back to the manufacturer in a profitable manner (Ardila Gamboa, Ballesteros Riveros 2018). REL comprises four key functions: assembly, classification/trying, withdrawal, and redeploying (Sangwan 2017).…”

“…Agrawal et al (2016) REL performance is highly dependent on the three major factors in the order of significance: economic (measured by creating and adding value, ROI), environmental (measured by low energy usage, ideal usage of inputs), and then the social performance (measured by customers' safety, and complaints). Ardila Gamboa, Ballesteros Riveros (2018) Measuring the performance of DCs relying on KPI in REL. Results showed that DC with better efficiency, which is measured by calculating outputs over inputs, and which have higher better relative efficiency, which is measured by calculating a weighted average of outputs over the weighted Average of Inputs, have better REL performances, and thus they have better profits and decision-making.…”

Measuring the impact of factors affecting reverse e-logistics' performance in the electronic industry in Lebanon and Syria

“…REL is a series of processes in which different kinds of products, whether defected or wrong or for the sake of recycling, are assimilated from users to the producer's profitability (GAMBOA;RIVEROS, 2019). REL concept goes back to the earliest 90s, where several countries noticed the importance of taking care of the environment and its natural resources, which in turn will yield profits if resources were used wisely.…”

“…REL's significance is not related only to increasing profits, but also to better competing position, efficiency in performance, and customer satisfaction (YOGI, 2015;HUANG et al, 2015;EUCHI et al, 2019;AGRAWAL et al, 2016;GAMBOA;RIVEROS, 2019;SANGWAN, 2017;MAHINDROO et al, 2018;MORGAN et al, 2018).…”