Evaluating Line Efficiencies in the Textile Manufacturing Industry to optimize performance: A Data Envelopment Analysis Approach

Abstract

This study evaluates the performance of individual manufacturing lines in the textile industry, a critical sector for economic growth in South Asia, using Data Envelopment Analysis (DEA). Employing both Constant Returns to Scale (CRS) and Variable Returns to Scale (VRS) models, the research categorizes 20 manufacturing lines into efficiency tiers efficient, weakly efficient, or inefficient. To enhance performance, the most productive scale size (MPSS) model was applied to identify scale sizes and returns to scale, enabling tailored recommendations. Based on the scale size the manufacturing lines were classified into groups then the approach that the manufacturing line should use to be efficient was recommended based on that group. The findings provide actionable insights for improving efficiency in the textile industry and establish a flexible DEA framework that can be adapted for performance evaluation across other manufacturing sectors. Future research could expand this approach by incorporating longitudinal data and assessing the impact of technological advancements on operational efficiency.