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Rationalising inefficiency: Staff utilisation in branches of a large Canadian bank

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  • Asmild, Mette
  • Bogetoft, Peter
  • Leth Hougaard, Jens

Abstract

In this paper we consider staffing decisions in branches of a large Canadian bank. The bank has well-developed staffing models and the branches work in a highly competitive environment. One would therefore expect limited ‘inefficiency’ in the sense of wasted resources and over-staffing. Using Data Envelopment Analysis (DEA) we nevertheless find considerable ‘inefficiency’ which raises the question whether this is best interpreted as waste or if the apparent inefficiency may serve other purposes. To investigate this, we invoke the theoretical framework of rational inefficiency (Bogetoft and Hougaard [8]).

Suggested Citation

  • Asmild, Mette & Bogetoft, Peter & Leth Hougaard, Jens, 2013. "Rationalising inefficiency: Staff utilisation in branches of a large Canadian bank," Omega, Elsevier, vol. 41(1), pages 80-87.
  • Handle: RePEc:eee:jomega:v:41:y:2013:i:1:p:80-87
    DOI: 10.1016/j.omega.2011.01.011
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    References listed on IDEAS

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    2. Peter Bogetoft & Jens Hougaard, 2003. "Rational Inefficiencies," Journal of Productivity Analysis, Springer, vol. 20(3), pages 243-271, November.
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    Cited by:

    1. Mihăiță-Cosmin M. POPOVICI, 2013. "A Survey On Bank Efficiency Research With Data Envelopment Analysis And Stochastic Frontier Analysis," SEA - Practical Application of Science, Fundația Română pentru Inteligența Afacerii, Editorial Department, issue 1, pages 134-142, June.
    2. Ray, Subhash, 2016. "Cost efficiency in an Indian bank branch network: A centralized resource allocation model," Omega, Elsevier, vol. 65(C), pages 69-81.
    3. AGRELL, Per & BOGETOFT, Peter, 2013. "Benchmarking and regulation," CORE Discussion Papers 2013008, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    4. Kao, Chiang & Liu, Shiang-Tai, 2014. "Multi-period efficiency measurement in data envelopment analysis: The case of Taiwanese commercial banks," Omega, Elsevier, vol. 47(C), pages 90-98.
    5. Chowdhury, Hedayet & Zelenyuk, Valentin, 2016. "Performance of hospital services in Ontario: DEA with truncated regression approach," Omega, Elsevier, vol. 63(C), pages 111-122.
    6. Bogetoft, Peter & Hougaard, Jens Leth & Smilgins, Aleksandrs, 2016. "Applied cost allocation: The DEA–Aumann–Shapley approach," European Journal of Operational Research, Elsevier, vol. 254(2), pages 667-678.
    7. Eskelinen, Juha & Kuosmanen, Timo, 2013. "Intertemporal efficiency analysis of sales teams of a bank: Stochastic semi-nonparametric approach," Journal of Banking & Finance, Elsevier, vol. 37(12), pages 5163-5175.
    8. repec:cmj:journl:y:2013:i:27:popovicimc is not listed on IDEAS
    9. repec:eee:ejores:v:263:y:2017:i:3:p:1095-1108 is not listed on IDEAS

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