The impact of information technology on organizational efficiency in public services: a DEA-based DT approach

This study attempts to examine the impact of information technology (IT) on organizational efficiency in public services. We propose a new approach to providing the directions of IT investments to improve organizational efficiency. The proposed approach is based on the integrated form of data envelopment analysis (DEA) and decision tree (DT), and composed of two steps. First, DEA is conducted to measure organizational efficiency with the selected inputs and outputs. Second, DT is built based on efficiency scores obtained from DEA and IT factors, as a target variable and predictor variables, respectively. In doing so, we can identify the relative impact of IT investments on organizational efficiency and set priorities to the IT investments to improve efficiency from a view point of each organization. A case study on the Korean local governments is presented to illustrate the usefulness of the proposed approach.