Measurement of multiple sites in service firms with data envelopment analysis

Data envelopment analysis (DEA) has become an increasingly popular method to measure performance for service firms with multiple sites. DEA is superior to many traditional methods for firms that have multiple goals. The promise of DEA is that the complex, multiobjective problem of performance measurement can be reduced to a single number. Unfortunately, the practice of DEA often belies the promise. Misconceptions concerning the purpose and implementation of DEA can cause DEA applications to be less than successful. Here, the technique is explained, and a guide to the implementation of DEA is proposed, utilizing DEA studies of retail bank branches.