An Empirical Study of Efficiency Evaluation with Dynamic Strategy Trajectory Based on DEA Algorithm and BCG Model: A Case Study of Securities Industry

Abstract

The U.S. Subprime Mortgage Crisis in 2008 led many financial institutions, including those in the securities industry, to the verge of bankruptcy. As the securities industry has a pivotal position in financial markets, this study aims to use Data Envelopment Analysis (DEA) to discuss the efficiency of the securities industry after the Financial Tsunami. In addition, this paper integrates the concept of the Boston Consulting Group (BCG) matrix to categorize the efficiency values of the two-stage DEA management strategy and analyze the strategy trajectory. Moreover, to verify whether there is any difference in the efficiency of various stages after the Financial Tsunami, the non-parametric statistical method is used to analyze the single-stage and two-stage efficiency values. Finally, Decision Making Units (DMUs) are clustered according to environmental variables in the literature and significant differences in efficiency are tested in order to understand the impact of environmental variables on the efficiency of the securities industry after the Financial Tsunami. The empirical results can serve as a reference for the securities industry to assess its operational performance and profit performance. In addition, this study provides a tool for securities industry decision-makers to assess business performance after the Financial Tsunami.