Data Envelopment Analysis: An Application to Turkish Banking Industry

DEA is a well-known decision making tool and efficiency measurement technique which was proposed by Charnes et al. in : 1978 in EJOR. Since then, the technique had proved itself in many application in many areas like banking, agriculture, transportation and so on and many papers had written in many journals by authors around the worldwide.
DEA is a non-parametric technique and scope of DEA is to determine the efficiency of decision-making units (DMUs). It divides the DMUs into two group named as efficient and inefficient, then derives a piecewise linear frontier with pareto-efficient DMUs and gives an efficiency score of 1(one) to each of them. However, the DMUs below the frontier gets an efficiency score less than 1 (one). Their efficiency score is determined by the distance between the frontier and the coordinates of each of the inefficient DMUs. Furthermore, DEA also determines the source and the amount of inefficiency so that DEA becomes indispensable for decision-makers, named as boss, manager director, owner or others. In this paper, despite of the classical usage, a new area for DEA would be introduced and a new definition would be made for decision-maker. In our work decision-maker is customer.