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

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]).