Benchmarking against average is easy. Benchmarking against perfection is hard. SFA estimates the messy "production frontier"—the maximum output possible for a given input—and measures how far you are from it.
"How efficient is this channel compared to theoretical max?"
"Are we suffering from inefficiency or bad luck?"
"Which vendors are underperforming their potential?"
It decomposes the error term into two parts: Random Noise (Luck) and Inefficiency (Waste). It draws a curve over the top of the data cloud, not through the middle.
The Problem
Accepting mediocre agency results.
What It Reveals
The gap between their results and the 'Efficient Frontier'.
Decision Enabled
Renegotiate or switch vendors.
Powers the Vendor Waste Detector to flag sub-optimal performance that isn't just noise.
A scatter plot with a Frontier Curve. Points below the curve are inefficient. The distance is the Efficiency Score.