ABSTRACT
This chapter focuses on the importance of having a performance tool to enable policy-makers to monitor the performance of social enterprises. It discusses the various performance measurement challenges facing policy-makers in monitoring the performance of social enterprises. The chapter introduces the data envelopment analysis (DEA) methodology and discusses its advantages for policy-makers. It offers an innovative tool that allows policy-makers to measure the dual objectives of social enterprises, as well as to identify sources of performance change. The chapter describes a non-specialist audience, DEA and the Malmquist index, which is used to monitor performance over time, with an illustration showing its applicability. This approach allows for a straightforward presentation of the possibilities of DEA and Malmquist index outputs for policy-makers. DEA generates efficiency scores through a mathematical optimization problem, without the need for explicit weight specifications for inputs and outputs. Based on efficiency scores, policy-makers can pinpoint good performance and identify strong and weak performers.
