Multicomponent Efficiency Measurement and Shared Inputs in Data Envelopment Analysis: An Application to Sales and Service Performance in Bank Branches

In most applications of DEA presented in the literature, the models presented are designed to obtain a single measure of efficiency. In many instances however, the decision making units involved may perform several different and clearly identifiable functions, or can be separated into different components. In such situations, inputs, in particular resources, are often shared among those functions. This sharing phenomenon will commonly present the technical difficulty of how to disaggregate an overall measure into component parts. In the present paper, we extend the usual DEA structure to one that determines a best resource split to optimize the aggregate efficiency score. The particular application area investigated is that involving the sales and service functions within the branches of a bank. An illustrative application of the methodology to a sample of branches from a major Canadian bank is given.