Identifying managerial groups in a large Canadian bank branch network with a DEA approach

► We compare the bank’s method of sorting branches for comparison with a DEA model. ► We establish a grouping process to match management’s needs for benchmarking. ► The method proposed helps the bank carry out continuous productivity improvements. ► The results obtained were verified against tradit...

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Veröffentlicht in:European journal of operational research 2012-05, Vol.219 (1), p.178-187
Hauptverfasser: Paradi, Joseph C., Zhu, Haiyan, Edelstein, Barak
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container_title European journal of operational research
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creator Paradi, Joseph C.
Zhu, Haiyan
Edelstein, Barak
description ► We compare the bank’s method of sorting branches for comparison with a DEA model. ► We establish a grouping process to match management’s needs for benchmarking. ► The method proposed helps the bank carry out continuous productivity improvements. ► The results obtained were verified against traditional clustering algorithms. ► We validated against the bank’s “community and population size” grouping criteria. This paper develops a new grouping approach in using data envelopment analysis as a framework to identify management groups and group performance leaders. The management group relies on the fact that branches grouped together present similar managerial preferences over performance goals and resource deployments due to internal or external market forces. This grouping approach can help a firm to create continuous improvement opportunities with effectively promoting the best managerial practices within groups, given similar operating characteristics. This approach’s grouping power and rationality is examined in the context of a large Canadian bank with about 1000 branches. The advantages of this new grouping approach are further verified through comparisons with the results obtained from the traditional clustering algorithm and the collaborating Bank’s “community type and population size” grouping criteria.
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subjects Algorithms
Applied sciences
Bank branch
Banks
Branch banking
Branch management
Clustering methods
Communities
Criteria
Data envelopment analysis
Decision theory. Utility theory
DMU grouping
Exact sciences and technology
Firm modelling
Groups
Markets
Mathematics
Nonparametric inference
Operational research
Operational research and scientific management
Operational research. Management science
Operations research
Optimization algorithms
Probability and statistics
Resource management
Sciences and techniques of general use
Statistics
Studies
title Identifying managerial groups in a large Canadian bank branch network with a DEA approach
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