Performance Evaluation of Production Lines in a Manufacturing Company Using Data Envelopment Analysis (DEA)

Abstract

The concept of producing more output(s) with less input(s) has always been one of the goals of every manufacturing industry.However, continuous evaluation of production systems will ensure that production targets are not only being met but also to ensure that each decision-making unit produces at an optimal level compared to the laid down standard(s).This work evaluated the efficiency of the six most productive production lines in a brewery plant using one of the non-parametric efficiency measurement techniques in data envelopment analysis (DEA).The DEA model for each of the lines was formulated.The relative efficiencies of each of the lines were calculated and the most efficient was chosen as a benchmark.The slacks and surpluses in each production line relative to the benchmark were obtained.The model result revealed that two of the production lines as the most efficient, a reduction in manpower and an increment in product output in some of the lines are required to meet the production benchmark.It may be observed that not all seemingly effective production lines are effective when compared with others within the same system.