Combining fuzzy integral with order weight average (OWA) method for evaluating financial performance in the semiconductor industry

The semiconductor industry is characterized by rapid change and ever-increasing competition. To sustain the competitiveness and survive in such an environment, semiconductor companies must improve their performance continuously. Financial performance is an important indicator to represent the operation performance of each organization. The strength and weakness of financial performance can not only show the performance of the company operations, but also indicate its growth and potential competitiveness in the future. Financial ratio is a composite of various attributes, and there are some degrees of interdependence between those attributes. Therefore, a non-additive model is proposed for evaluating the financial performance of semiconductor industry. By combining fuzzy integral with order weight average (OWA) method, an integrated model considering inter-dependent attributes of financial performance is proposed in this paper for semiconductor industry. First, factor analysis (FA) is applied to extract some independent common factors based on the attributes of financial performance. Second, the OWA is used to determine the relative weights of each independent common factor. Third, the fuzzy integral is applied to integrate the performance ratings of attributes with respect to each common factor. In case verification, we practically collected the finance ratio data of semiconductor industry in 2008 from open information market in Taiwan. The evaluation results can provide the valuable information of investment decision for managers and stockholders.