TY - JOUR

T1 - Rationalising inefficiency

T2 - staff utilisation in branches of a large Canadian bank

AU - Asmild, Mette

AU - Bogetoft, Peter

AU - Hougaard, Jens Leth

N1 - Data Envelopment Analysis: The Research Frontier - Special Issue is dedicated to the memory of William W. Cooper 1914-2012

PY - 2013

Y1 - 2013

N2 - 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]). A systematic pattern of slack consumption emerges, which suggests that the allocation of slack between staff groups is far from random. The slack pattern seems natural from the point of view of employee value and hierarchy and also considering employee flexibility and substitutability. For example we find relatively large over-staffing at the supervisor level which is natural given both their strong bargaining position derived from their role in the branch hierarchy and given the relative flexibility of supervisor resources.

AB - 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]). A systematic pattern of slack consumption emerges, which suggests that the allocation of slack between staff groups is far from random. The slack pattern seems natural from the point of view of employee value and hierarchy and also considering employee flexibility and substitutability. For example we find relatively large over-staffing at the supervisor level which is natural given both their strong bargaining position derived from their role in the branch hierarchy and given the relative flexibility of supervisor resources.

U2 - 10.1016/j.omega.2011.01.011

DO - 10.1016/j.omega.2011.01.011

M3 - Journal article

VL - 41

SP - 80

EP - 87

JO - Omega: The International Journal of Management Science

JF - Omega: The International Journal of Management Science

SN - 0305-0483

IS - 1

ER -