Importance Of Applying Data Envelopment Analysis In Case Of Higher Educational Institutions

Today, the saying predominates better and better according to which a strong target rationalism has to characterize the higher educational institutions due to the scarce resources and the limitlessness of user demands. Now in Hungary, the funding of higher educational system goes through a total transformation thus the leadership has continuously to reckon with the changes of environment and, in tune with these ones, has to modify the goals existing already. Nowadays, it becomes more and more important to measure the effectiveness of the organizations – organizational units pursuing the same or similar activities relative to each other. Benchmarking helps this procedure. Benchmarking is none other than such a tool of analysis and planning which allows comparing the organizations with the best of the competitors. Applying the method with regard to the higher educational institutions is really nothing but a procedure which focuses on comparing processes and results of the institutions’ different functional areas in order to bring to light the opportunities for the rationality as well as the quality and performance improvement. Those benefits could be managed and used as breakthrough possibilities which have been already developed/applied by other organizations and are given by the way leading to a more effective management.The main goal of my monograph is to show a kind of application of Data Envelopment Analysis (DEA) method in the higher education. DEA itself is a performance measuring methodology which is a part of benchmarking and uses the linear programming as a method. By means of its application, the effectiveness of different decision-making units can be compared numerically. In our forcefully varying environment, the managerial decision making can be largely supported in each case by such information that is numerically able to identify which organizational units and activities are effective or less effective. Its advantage is that there is no need to know any of the function-like relations itself for applying this method. The method interprets the effectiveness as a quotient which is defined by the inputs used in the functioning and the outputs arisen from the inputs. The method is already applied in other countries because, beyond its main benefit (being able to work with small element number), it is also suitable for measuring effectiveness of the non-profit sector. In spite of this, DEA methodology has not been really wide-spread in our country yet. The performance measurement forms an important part of the institutions’ everyday operation since the resources are barely available and a targeted effective utilization helps to maintain a long-term and competitive functioning in the future.