Finding a suitable benchmark for commercial bank branches using DEA

Subject Areas : International Journal of Data Envelopment Analysis

M.R. Mozaffari ¹ , F. hosseinzadeh Lotfi ² , J. Gerami ³

1 - Department of Mathematics, Science and Research Branch,Islamic Azad University,Fars, Iran
2 - Department of Mathematics, Science and Research Branch,Islamic Azad University,Tehran, Iran
3 - Department of Mathematics, Science and Research Branch,Islamic Azad University,Fars, Iran

Received: 2014-03-29 Accepted : 2014-03-29 Published : 2013-04-01

Keywords: Data Envelopment Analysis, Benchmark, Linear Programming,

Abstract :

This paper proposes a suitable benchmark for inefficient commercial bank branches by using Data Envelopment Analysis (DEA). In order to render an inefficient bank branch efficient, it is necessary to decrease inputs and increase outputs. As there are priorities for decreasing some certain inputs and increasing some certain outputs over other inputs and outputs, respectively, it is necessary to consider and incorporate the managers’ view regarding the priorities in the models which are applied. So, in this paper, using the enhanced Russell model for an inefficient bank branch, we propose the decrease in inputs and the increase in outputs, taking the managers’ priorities into account. Finally, in a numerical example, we apply the proposed procedure to the authentic information from 30 commercial bank branches, to show the application of the procedure.