A Hybrid Approach Based on Multi-Criteria Satisfaction Analysis (MUSA) and a Network Data Envelopment Analysis (NDEA) to Evaluate Efficiency of Customer Services in Bank Branches Kaveh Khalili-Damghani* Department of Industrial Engineering, South-Tehran Branch, Islamic Azad University, Tehran, Iran Mohammad Taghavi-Fard Department of Industrial Management, Faculty of Management and Accounting, AllamehTabataba’i University, Tehran, Iran Kiaras Karbaschi Department of Management, Iran Banking Education Institute, Tehran, Iran (Received: July 11, 2015 / Revised: December 5, 2015 / Accepted: December 6, 2015) ABSTRACT A hybrid procedure based on multi-Criteria Satisfaction Analysis (MUSA) and a Network Data Envelopment Analysis (NDEA) is proposed to evaluate the relative efficiency of customer services in bank branches. First, a three-stage process including sub-processes such as customer expectations, customer satisfaction, and customer loyalty, is defined to model the banking customer services. Then, fulfillment of customer expectations, customer loyalty level, and the customer satisfaction degree are measured and quantified through a multi-dimensional questionnaire based on cus- tomers’ perceptions analysis and MUSA method, respectively. The customer services scores and the other criteria such as mean of employee evaluation score, operation costs, assets, deposits, loans, number of accounts are considered in network three-stage DEA model. The proposed NDEA model is formed based on multipliers perspective, output- oriented, and constant return to scale assumptions. The proposed NDEA model quantifies and assesses the total effi- ciency of main process and assigns the efficiency to customer expectations, customer satisfactions, and customer loy- alties sub-processes in bank branches. The whole procedure is applied on 30 bank branches in IRAN. The proposed approach can be used in other organizations such as airports, airline agencies, urban transportation systems, railway organizations, chain stores, chain restaurants, public libraries, and entertainment centers. Keywords: Network Data Envelopment Analysis, Multi-Criteria Satisfaction Analysis, Performance Measurement, Customer Satisfaction Analysis, Bank Performance * Corresponding Author, E-mail: kaveh.khalili@gmail.com 1. INTRODUCTION Every organization needs to have information about the performance of units and branches that work under its supervision. This is particularly important in banks. Although bank branches do similar jobs, they perform Industrial Engineering & Management Systems Vol 14, No 4, December 2015, pp.347-371 http://dx.doi.org/10.7232/iems.2015.14.4.347 ISSN 1598-7248│EISSN 2234-6473│ © 2015 KIIE