IDEAS home Printed from https://ideas.repec.org/p/ptu/wpaper/w200923.html
   My bibliography  Save this paper

Adding Value to Bank Branch Performance Evaluation Using Cognitive Maps and MCDA: A Case Study

Author

Listed:
  • Fernando A. F. Ferreira
  • Sérgio P. Santos
  • Paulo M.M. Rodrigues

Abstract

The performance evaluation of bank branches is a difficult task. One of the main reasons for this difficulty is the complexity inherent in the variety of aspects to be considered in the evaluation, and the multiple and conflicting interests of the different stakeholders involved. In this paper we aim to show how cognitive mapping and the MACBETH approach can be used to support the evaluation of bank branches through the development of multidimensional performance evaluation systems, and to deal explicitly with the trade-offs between the different dimensions of performance and interests of different stakeholders. A case study is discussed where these techniques are used in a constructive way, making the learning activity easier and introducing transparency in the decision making process. The strengths and weaknesses of the integrated use of these two operational research techniques in this context are also discussed.

Suggested Citation

  • Fernando A. F. Ferreira & Sérgio P. Santos & Paulo M.M. Rodrigues, 2009. "Adding Value to Bank Branch Performance Evaluation Using Cognitive Maps and MCDA: A Case Study," Working Papers w200923, Banco de Portugal, Economics and Research Department.
  • Handle: RePEc:ptu:wpaper:w200923
    as

    Download full text from publisher

    File URL: https://www.bportugal.pt/sites/default/files/anexos/papers/wp200923.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Bana e Costa, Carlos A. & Ensslin, Leonardo & Correa, Emerson C. & Vansnick, Jean-Claude, 1999. "Decision Support Systems in action: Integrated application in a multicriteria decision aid process," European Journal of Operational Research, Elsevier, vol. 113(2), pages 315-335, March.
    2. Paradi, Joseph C. & Schaffnit, Claire, 2004. "Commercial branch performance evaluation and results communication in a Canadian bank--a DEA application," European Journal of Operational Research, Elsevier, vol. 156(3), pages 719-735, August.
    3. Cook, Wade D. & Seiford, Lawrence M. & Zhu, Joe, 2004. "Models for performance benchmarking: measuring the effect of e-business activities on banking performance," Omega, Elsevier, vol. 32(4), pages 313-322, August.
    4. Suwignjo, P. & Bititci, U. S & Carrie, A. S, 2000. "Quantitative models for performance measurement system," International Journal of Production Economics, Elsevier, vol. 64(1-3), pages 231-241, March.
    5. Eden, Colin & Ackermann, Fran, 2004. "Cognitive mapping expert views for policy analysis in the public sector," European Journal of Operational Research, Elsevier, vol. 152(3), pages 615-630, February.
    6. Bana E Costa, Carlos A. & Stewart, Theodor J. & Vansnick, Jean-Claude, 1997. "Multicriteria decision analysis: Some thoughts based on the tutorial and discussion sessions of the ESIGMA meetings," European Journal of Operational Research, Elsevier, vol. 99(1), pages 28-37, May.
    7. Mihelis, G. & Grigoroudis, E. & Siskos, Y. & Politis, Y. & Malandrakis, Y., 2001. "Customer satisfaction measurement in the private bank sector," European Journal of Operational Research, Elsevier, vol. 130(2), pages 347-360, April.
    8. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    9. Dekker, David & Post, Thierry, 2001. "A quasi-concave DEA model with an application for bank branch performance evaluation," European Journal of Operational Research, Elsevier, vol. 132(2), pages 296-311, July.
    10. Emel, Ahmet Burak & Oral, Muhittin & Reisman, Arnold & Yolalan, Reha, 2003. "A credit scoring approach for the commercial banking sector," Socio-Economic Planning Sciences, Elsevier, vol. 37(2), pages 103-123, June.
    11. Bana e Costa, Carlos A. & Corrêa, Émerson C. & De Corte, Jean-Marie & Vansnick, Jean-Claude, 2002. "Facilitating bid evaluation in public call for tenders: a socio-technical approach," Omega, Elsevier, vol. 30(3), pages 227-242, June.
    12. Knox Lovell, C. A. & Pastor, Jesus T., 1997. "Target setting: An application to a bank branch network," European Journal of Operational Research, Elsevier, vol. 98(2), pages 290-299, April.
    13. Belton, Valerie & Hodgkin, Julie, 1999. "Facilitators, decision makers, D.I.Y. users: Is intelligent multicriteria decision support for all feasible or desirable?," European Journal of Operational Research, Elsevier, vol. 113(2), pages 247-260, March.
    14. Cyree, Ken B. & Wansley, James W. & Boehm, Thomas P., 2000. "Determinants of bank growth choice," Journal of Banking & Finance, Elsevier, vol. 24(5), pages 709-734, May.
    15. Cook, Wade D. & Hababou, Moez, 2001. "Sales performance measurement in bank branches," Omega, Elsevier, vol. 29(4), pages 299-307, August.
    16. Hartman, Thomas E. & Storbeck, James E. & Byrnes, Patricia, 2001. "Allocative efficiency in branch banking," European Journal of Operational Research, Elsevier, vol. 134(2), pages 232-242, October.
    17. Halkos, George & Salamouris, Dimitrios, 2001. "Efficiency Measures of the Greek Banking Sector: A Non-Parametric Approach for the Period 1997-1999," MPRA Paper 2858, University Library of Munich, Germany.
    18. Camanho, A. S. & Dyson, R. G., 2005. "Cost efficiency measurement with price uncertainty: a DEA application to bank branch assessments," European Journal of Operational Research, Elsevier, vol. 161(2), pages 432-446, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fernando A. F. Ferreira & Sérgio P. Santos & Paulo M.M. Rodrigues & Ronald W. Spahr, 2011. "Evaluating retail banking quality service and convenience with MCDA techniques: a case study at the bank branch level," Working Papers w201131, Banco de Portugal, Economics and Research Department.
    2. Fernando A. F. Ferreira & Sérgio P. Santos & Paulo M. M. Rodrigues & Ronald W. Spahr, 2014. "How to create indices for bank branch financial performance measurement using MCDA techniques: an illustrative example," Journal of Business Economics and Management, Taylor & Francis Journals, vol. 15(4), pages 708-728, September.

    More about this item

    JEL classification:

    • C44 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Operations Research; Statistical Decision Theory
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ptu:wpaper:w200923. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (DEE-NTDD). General contact details of provider: http://edirc.repec.org/data/bdpgvpt.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.