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A Data Envelopment Analysis of the Operational Efficiency of Bank Branches

Author

Listed:
  • B. Golany

    (Faculty of Industrial Engineering and Management, The Technion—Israel Institute of Technology, Technion City, Haifa 32000, Israel)

  • J. E. Storbeck

    (Performance Management Associates, PO Box 1510, Blanco, Texas 78606-1510)

Abstract

We performed a multiperiod data envelopment analysis (DEA) study of the efficiencies of selected branches of a large US bank (which we will call Big Bank) over six consecutive quarters (second quarter of 1992 to the third quarter of 1993). We developed a number of innovative application tools, including budgeting and target-setting modules, within a DEA framework that we subsequently customized for Big Bank. Within the performance-evaluation framework, we developed the ability to identify different potential groupings of branches that supported the multiple user views of the system. We also developed procedures to evaluate trends over time and differences in performance across user-defined aggregations of branches. We paid attention to the interface with the end users and, in particular, developed presentation tools to make the outcomes of the analysis available to managers at different levels of the bank.

Suggested Citation

  • B. Golany & J. E. Storbeck, 1999. "A Data Envelopment Analysis of the Operational Efficiency of Bank Branches," Interfaces, INFORMS, vol. 29(3), pages 14-26, June.
    • Handle: RePEc:inm:orinte:v:29:y:1999:i:3:p:14-26
    DOI: 10.1287/inte.29.3.14
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    References listed on IDEAS

    as
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    7. R J Colwell & E P Davis, 1992. "Output, Productivity and Externalities - the Case of Banking," Bank of England working papers 3, Bank of England.
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