The comparative productivity efficiency for global telecoms

This paper reconciles diverse efficiency measures to characterize the productivity efficiency of 39 Forbes 2000 ranked leading global telecom operators. Productivity efficiency ratings should be considered as a key element for achieving greater business performance and better market position. This study applies the data envelopment analysis (DEA) approach with the classical radial measure, A&P efficiency measure and efficiency achievement measure, respectively, combining multiple outputs and inputs to measure the magnitude of performance differences between leading telecom carriers. Empirical results indicate that top-ranked Forbes telecom operators are not the same as those having top-ranked CCR efficiency measures. The results show that about 20.5% of Forbes 2000 telecom operators are operating on the best-practice frontier for CCR efficiency measure, while only 7.7% match the efficiency achievement measure criteria. This study also shows that Asia-Pacific telecom operators have better productivity efficiency than those in Europe and America but the differences are not significant. Another interesting find is that the state-owned telcos as a group show a relatively higher scoring than the privatized telcos as a group because they maintain full-service (fixed-line, mobile and Internet) operations as compared to maintaining fixed-only or mobile-only operations (except China), but the differences are not significant. It has been concluded that competition in the global telecom, market will continue to be tied to the enhanced productivity efficiency. (c) 2006 Elsevier B.V. All rights reserved.