You are working for an automobile assembly company in the United States. Specifically, you are responsible for
Question:
You are working for an automobile assembly company in the United States. Specifically, you are responsible for selecting a supplier for your company. There are 10 candidates: some are from the U.S. and others are from foreign countries.
Question 1.You decided to select the best performing supplier based on efficiency and innovation. First, you need to applydata envelopment analysisto calculate the efficiency of each supplier. The efficiency is determined by three input factors (number of employees, value of fixed assets, and number of patents) and two output factors (profit and sale). You useoutput-oriented CCR modelbased on data in Table 1.
Table 1.Data for Question 1
Supplier | Input | Output | |||
Number of employees | Value of fixed assets | Number of patents | Profit | Sale | |
A | 200 | 30 | 20 | 100 | 200 |
B | 200 | 50 | 10 | 110 | 220 |
C | 300 | 70 | 20 | 120 | 240 |
D | 300 | 50 | 10 | 130 | 260 |
E | 400 | 30 | 30 | 140 | 280 |
F | 400 | 90 | 40 | 150 | 300 |
G | 500 | 110 | 30 | 160 | 320 |
H | 500 | 130 | 40 | 170 | 340 |
I | 600 | 110 | 50 | 180 | 360 |
J | 600 | 90 | 60 | 190 | 380 |
Fill out Table 2 and determine efficient suppliers.
Table 2.Efficiency scores of suppliers
Supplier | Efficiency Score | Efficient? Yes or No |
A | ||
B | ||
C | ||
D | ||
E | ||
F | ||
G | ||
H | ||
I | ||
J |
Second, you need to consider the innovation capacities of suppliers. Assume that the innovation capacities are represented by the number of patents. Of efficient firms, you select a supplier with more patents.
Indicate the supplier you selected. Also, submit the MS Excel file that supports your selection.