Table 2-3 reports the results of DEA applied to these five branches.
DEA identified the same inefficient branches that were identifiable
through observation of the data. Bl and B2 have efficiency ratings
below 100%, which identifies them as inefficient. In addition, DEA
focuses the manager's attention on a subgroup of the bank branches
referred to as the efficiency reference set in Table 2-3. This efficiency
reference set (ERS) includes the group of service units against which
each inefficient branch was found to be most directly inefficient. For
example, Bl was found to have operating inefficiencies in direct
comparison to B4 and B5. The value in parentheses in Table 2-3
represents the relative weight assigned to each efficiency reference set
(ERS) member to calculate the efficiency rating (0), Figure 2-1
illustrates this using B2 as an example. (If a service unit's efficiency
rating is 100%, then this unit is its own ERS and we generally do not
report it as an ERS, which is the reason B3, B4, and BShave not
reported ERS in the Table 2-3.)