Sensitivity Analysis of Inefficient Supply Chains

The present study is an attempt toward improving the performance of members of supply chain. Improvement of two-stage supply chains is three cases. Inefficients suppliers are improved or inefficient manufactures are improved or both of them are improved. First, New sub-perfect supply chain production possibility set is obtained with efficiency score of α for inefficient suppliers and only all DEA inefficient suppliers are improved. It is proved that as the efficiency score of all points on the main frontier supposed to be 1, the efficiency score on the new frontier is α .Second the procedure is applied for those supply chains which are inefficient in manufacture performance and only all DEA inefficient manufacturers are improved and the last one, it is used to improve the supply chains which are inefficient in supplier and manufacture performances at the same time. In the last two ones it is shown that there are improvements in inefficient manufactures or in both of them at the same time but the improved efficiency is not able to appraise exactly. Overall performance score has an improvement in all cases and the supply chain management can choose the best strategies to maximize overall efficiency score. This paper develops procedures which are referred to each case for performing a sensitivity analysis of the inefficient supply chains in constant returns to scale (CRS). The real case is applied to accept this approach.