Evaluating knowledge outsourcing performance of public sectors with data envelopment analysis

Abstract

With the governmental sectors imitating the reformation of enterprises stressing on Knowledge, Contracting Out and Deregulation have become the core policies. Contracting Out is not based on the arbitrariness of an administrator, but the selective efficiency and competition. Connecting the resources between Public and Private Sectors is a concern of Contracting Out, while Knowledge Outsourcing is an innovation to enhance organizational knowledge and the reduction of organizational ignorance. Based on a Knowledge Outsourcing Investigation by the Kaohsiung City Government (Taiwan) in the past few years, Data Envelopment Analysis (DEA) and Sensitivity Analysis are integrated for measuring the total efficiency (TE), pure technical efficiency (PTE), and scale efficiency (SE) of Knowledge Outsourcing of the sectors in the Kaohsiung City Government for the improvement reference of other counties and cities. From the message acquired from the efficiency and variables with the DEA, one DMU (Data Management Unit), or about 5% of all DMUs, appears to have strong Knowledge Outsourcing efficiency 1, showing favorable Knowledge Outsourcing efficiency. Two DMUs, comprising about 10% of all DMUs, reveal the marginal Knowledge Outsourcing inefficiency between 0.9 and 1. This implies that such sectors could better enhance the Knowledge Outsourcing efficiency. 17 DMUs, representing about 85% of all DMUs, exhibit an obvious Knowledge Outsourcing inefficiency of less than 0.9, so that the Finance and Transportation Bureaus present the lowest Knowledge Outsourcing efficiency.