Citation:

Salsabila Raihana Radian, Hary Febriansyah. "Determining Sales Performance Efficiency in Bank X Using Data Envelopment Analysis (DEA) Model" International Research Journal of Economics and Management Studies, Vol. 3, No. 8, pp. 325-330, 2024.

Abstract:

The profitability of the bank is determined by how well the salespeople can generate revenue through their activities. Bank X, a private-owned bank in Indonesia, faced a persisting challenge of performance discrepancy. This situation indicates the difference in the efficiency of the salespeople or Relationship Managers in creating output for the bank. The analysis focuses on the sixteen branches located in Jakarta. Using the two-stage Data Envelopment Analysis (DEA) model, the calculation considers input, intermediary measures, and output to be included based on the data acquired from each branch. The result shows that some branches scored perfect efficiency in processing input into intermediary measures and intermediary measures into output. These branches are compared to those with non-perfect efficiency results and compared across three different perspectives to understand their reasons for disparity: demography, competency, and personality of the salespeople. The study also discussed the possibility of differences in personality traits between branches with perfect efficiency and non-perfect efficiency. Furthermore, based on the DEA model, the result can provide for future implementation in human capital improvement.

References:

[1] Charnes, A., Cooper, W. W., & Rhodes, E. L. (1978). Measuring the efficiency of decision-making units. European Journal of Operational Research, 2(6), 429–444. https://doi.org/10.1016/0377-2217(78)90138-8
[2] Chen, Y., & Zhu, J. (2004). Measuring information technology’s indirect impact on firm performance. Information Technology and Management, 5(1/2), 9–22. https://doi.org/10.1023/b:item.0000008075.43543.97
[3] Cook, W. D., & Hababou, M. (2001). Sales performance measurement in bank branches. Omega, 29(4), 299–307. https://doi.org/10.1016/s0305- 0483(01)00025-1
[4] Cooper, W. W. (2014). Origin and Development of Data Envelopment Analysis: Challenges and Opportunities. Data Envelopment Analysis Journal, 1(1), 3–10. https://doi.org/10.1561/103.00000002
[5] Cooper, W. W., Seiford, L. M., & Tone, K. (2006). Data Envelopment Analysis. In Springer eBooks. https://doi.org/10.1007/978-0-387-45283-8
[6] Frino, M. G., & Desiderio, K. P. (2013). The role of demographics as predictors of successful performance of sales professionals in Business-to-Business sales Organizations. Performance Improvement Quarterly, 25(4), 7–21. https://doi.org/10.1002/piq.21128
[7] Huang, R., Marquardt, C. A., & Zhang, B. (2015). Using sales revenue as a performance measure. Social Science Research Network. https://doi.org/10.2139/ssrn.2636950
[8] Herjanto, H., & Franklin, D. (2019). Investigating Salesperson Performance Factors: A systematic review of the literature on the characteristics of effective salespersons. Australasian Marketing Journal, 27(2), 104–112. https://doi.org/10.1016/j.ausmj.2018.12.001
[9] Le, T. D., Ho, T. N., Nguyen, D. T., & Ngo, T. (2022). Intellectual capital – bank efficiency nexus: evidence from an emerging market. Cogent Economics & Finance, 10(1). https://doi.org/10.1080/23322039.2022.2127485
[10] Paloniemi, S. (2006). Experience, competence and workplace learning. Journal of Workplace Learning, 18(7/8), 439– 450. https://doi.org/10.1108/13665620610693006
[11] Schaffnit, C., Rosén, D., & Paradi, J. C. (1997). Best practice analysis of bank branches: An application of DEA in a large Canadian bank. European Journal of Operational Research, 98(2), 269–289. https://doi.org/10.1016/s0377-2217(96)00347-5
[12] Sherman, H. D., & Ladino, G. (1995). Managing bank productivity using Data Envelopment Analysis (DEA). Interfaces, 25(2), 60– 73. https://doi.org/10.1287/inte.25.2.60
[13] Shewell, P., & Migiro, S. O. (2016). Data envelopment analysis in performance measurement: a critical analysis of the literature. Problems and Perspectives in Management, 14(3), 705–713. https://doi.org/10.21511/ppm.14(3-3).2016.14
[14] Wang, C. H., Gopal, R. D., & Zionts, S. (1997). Annals of Operations Research, 73, 191–213.doi:10.1023/a:1018977111455
[15] Zallocco, R., Pullins, E. B., & Mallin, M. L. (2009). A re‐examination of B2B sales performance. Journal of Business & Industrial Marketing, 24(8), 598–610. https://doi.org/10.1108/08858620910999466

Keywords:

Data Envelopment Analysis (DEA), Performance Efficiency, Relationship Manager, Salespeople Performance.