Efficiency of Non-Profit Organizations - a Case of the Czech Red Cross Local Branches

The efficiency of non-profit organizations is a key issue for stakeholders (especially donors and management) which are interested in efficient and effective utilization of resources. The aim of the paper is to compare the efficiency of local branches of the Czech Red Cross as important non-profit humanitarian organization in the Czech Republic. The relationship between financial efficiency (the expenditure to the number of paid staff, members and volunteers) and super-efficiency score (number of clients to the number of paid staff, members and volunteers) was investigated. The Data Envelopment Analysis (DEA) in its super-efficiency modification was used as an indicator of efficiency of the 69 LBs in the average of 2014 - 2016 because nonparametric DEA method has been more frequently used than parametric methods in the non-profit sector so far and super-efficiency modification emerged as a good method for efficiency evaluation of non-profit organizations. The results are fairly homogeneous and too many separate clusters have not been detected in the cluster analysis. Clusters were identified by combination of financial efficiency and super-efficiency scores. Authors revealed negative relationship between financial efficiency and super-efficiency score in 3 of 4 clusters.