Performance Evaluation of Mobile Network Operators Based on Input-Oriented Constant Return to Scale Model

Performance Evaluation of Mobile Network Operators Based on Input-Oriented Constant Return to Scale Model

Ahmed Tijjani Ishaq, Adeyemi Abel Ajibesin
Copyright: © 2022 |Pages: 17
DOI: 10.4018/IJESMA.300265
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Abstract

This research evaluated the Performance of major Mobile Network Operators (MNOs) in Nigeria using Data Envelopment Analysis (DEA). The DEA method that is based on Input-oriented Constant Return to Scale (CRS) model is considered. The objectives of this research were to analyze existing methods used for the evaluation of MNOs' performance and explored DEA which is a non-parametric method that relies on a linear programming technique for optimization. The aim is to evaluate the technical efficiency (TE) of each network operator and consequently determine their ranking. The result obtained shows the distributions of MNOs that are technically efficient and those that are technically inefficient. Also, the ranking according to their relative efficiency was presented. The findings, which are based on the CRS model show that among the four Nigerian major MNOs examined (MTN, 9mobile, Glo, and Airtel), 9mobile ranked the highest efficient mobile operator followed by the MTN, then GLO while Airtel has the lowest rank.
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Literature Review

This paper begins the review by making a distinction between the problem being addressed and the current practice being used by the NCC to evaluate the performance of MNOs. The current methods for MNOs’ performance evaluation focused on effectiveness while the proposed method focused on efficiency. Therefore, it is important to explore the difference between these two concepts. In the literature, the term “efficient” is very much confused and misused with the term “effective”. Efficiency is a measurable concept that quantitatively evaluates the ratio of output to input. Thus efficiency is concerned with how well things are done (Ajibesin, A. A., Ventura, N., Chan, H. A., & Murgu, A., 2014).

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