Abstract What higher education responds to free trade derived market pressure is to self review education quality through evaluation indices to enhance market competence. This paper takes performance evaluation as the main axis, facilities as items, applies Taguchi Loss Function and Analytical Hierarchy Process, quantify six evaluation factors, department/institute professional book volume, professional journal type, ratio of computer over student, facilities usage satisfaction, so as to build department/institute self-evaluation model. Examples are assumed to explain this model’s application and served as reference for university department/institute for improvement of teaching quality and competence.