A new benchmarking method to advance the two-model DEA approach: Evidence from a nursing home application

Shimshak and Lenard (2007) [Shimshak, D. G. and Lenard, M. L. (2007), "A two-model approach to measuring operating and quality efficiency with DEA", INFOR, 45 (3): 143-151] introduced the Two-Model DEA (TM-DEA) approach for selecting high-operating and high-quality benchmarks in a nursing home case, in which the DEA outputs were derived from operating and quality performance objectives. This work proposes a Two-Objective DEA (TODEA) method, which enhances TM-DEA via three major features: (1) solution procedures do not require value judgments; (2) no DMUs (decision making units) are excluded from analysis; and (3) identified benchmark DMUs are not dominated by the corresponding inefficient DMUs under either operating or quality objective. To clarify the benefits of the proposed method, TODEA was compared with TM-DEA and classical DEA techniques in the nursing home example.