Evaluating the Performance of Production Lines Using Expanded Data Envelopment Analysis, Analytic Hierarchy Process, and Entropy in a Grey Environment (Case Study: Kaleh Company)

Abstract

In today's competitive world, production at any cost is no longer on the agenda of organizations. In this context, the efficiency of production units in converting inputs to outputs is crucial, as inefficiency in a production unit can lead to wasting resources and inputs. For this reason, the Data Envelopment Analysis (DEA) method has attracted the attention of many researchers worldwide in recent years, and various applications of this method are observed for evaluating the performance of different institutions and activities. In this research, DEA is used to evaluate the performance of Kalleh Company's production line. After determining the efficient units, a combined method of Analytic Hierarchy Process (AHP) and Entropy is used to rank the efficient units. In other words, the Entropy method is used to weight the influential criteria, and the AHP is used to rank the efficient units. In other words, this research uses a combination of DEA, Entropy, and AHP methods to evaluate the performance of Kalleh Company's production line. Additionally, to consider real-world uncertainties and decision-making, the grey theory is used. Grey Theory uses interval numbers and creates more degrees of freedom to consider uncertainty. For this purpose, the combined method presented in this research is developed in a grey environment to deal with uncertainty. Finally, the proposed method is applied to Kalleh Company to evaluate performance. The results of the proposed method showed that production lines 1, 4, 8, and 14 were efficient. These lines were then re-evaluated using the combined Grey AHP and Entropy method, and line 4 was selected as the best production line.