Benchmarking universities' efficiency indicators in the presence of internal heterogeneity

When benchmarking its performance, a university is usually considered as a single strategic unit. According to the evidence, however, lower levels within an organisation (such as faculties, departments and schools) play a significant role in institutional governance, affecting the overall performance. In this article, an empirical analysis was carried out to obtain the teaching efficiency scores of the different schools belonging to 12 universities within one Italian region. In this perspective, the efficiency of a university can be viewed as the 'distribution' of the scores for each of its sub-units. The results show how the 'ranking' of efficient universities varies when they are analysed according to the different sub-units that compose them; moreover, the average efficiency scores seem to be greatly affected by the subject mix. The implication for management is that it is better to implement benchmarking exercises for the different schools within a university and not at the institutional level only.