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The purpose of this paper is to propose a new approach for gauging the performance of the operating units of a retail banking organisation, responding to the special demands of an internal evaluation.

The paper defines a measure of internal performance (MIP) based on behavioural theory, particularly on disappointment models.

MIP is applied for the internal evaluation of a network of bank branches. Application to this real managerial setting reveals that bank managers' preferences support behavioural decision theory, including prospect theory.

The paper shows how MIP can be used as a management tool for improving organisational performance. The approach can be extended to other sectors.

The proposal differs from others existing in the literature in two main aspects. Firstly, it is consistent with the requirements of an internal evaluation because it uses the managers' real preferences instead of assuming them. Secondly, it takes into account that each unit has a different target to achieve according to its specific characteristics.

The purpose of this paper is to investigate the total factor productivity (TFP) change in the Greek cooperative banking industry over the period 2000‐2005.

The paper employs the Malmquist index and estimate two models, one based on the intermediation approach, and one based on the production approach. TFP change is disaggregated into technical efficiency change and technological change, whereas technical efficiency change is decomposed further into pure technical efficiency change and scale efficiency change.

The results are mixed. The first model indicates a small decrease (3 per cent) in TFP whereas the second model indicates an increase by 6.6 per cent. Comparing the results on the basis of banks' size finds that TFP growth is higher for smaller banks on average over the entire period of our analysis. However, this relationship between size and productivity is not robust across the years. Furthermore, the differences between the groups are not statistically significant.

The results can be of special interest to several stakeholders such as customers‐members, bank managers, local community, and of course bank regulators.

This paper is believed to be the first that examines the productivity growth of Greek cooperative banks.

The purpose of this paper is to present a refined framework providing clarity in terms of the components of profitability and productivity change from the perspective of the firm level.

The literature is analysed with a scoping study and a systematic literature review. Productivity measurement approaches are compared using data at the product level.

The definition of total factor productivity (TFP) in the literature negatively affects the accuracy of profitability and productivity measurement. In the usual case of a dynamic output mix, TFP change encompasses biasing output mix effects relating to profitability, but not to productivity change. Therefore, this paper defines changes of a ratio of output quantities to input quantities not as TFP change, but as quantitative profitability (QP) change. A framework is proposed decomposing profitability change into price recovery and QP change, whereas the latter comprises of valid productivity change (encompassing technological, technical efficiency and productivity-related scale effects) and output mix change (encompassing proportion, quality, output switching and profitability-related scale effects).

Future research should include literature from the industrial organisation field of economics. The presented framework should be transferred to the standard production function framework used in economics.

The paper can help preventing faulty decision making or distrust due to the use of biased profitability or productivity indicators. TFP-based productivity indicators are unsuitable for most firms. To measure productivity meaningfully, firms should use adequate approaches (e.g. standard input- or adjusted total factor productivity-based ones).

The paper contributes to a more accurate performance measurement approach, as researchers and practitioners better understand the components of profitability and productivity change.

The purpose of this paper is to present empirical evidence about relationships between the corporate governance (CG) mechanisms of the Spanish savings banks, their financial and social performance and their profitability prior to their collapse.

The authors use a structural equation model (SEM), taking the return on assets as the dependent variable, and CG, corporate social responsibility and efficiency as explanatory constructs. SEM methodology provides interesting features that allows a better definition of some organisational characteristics.

Results indicate that CG characteristics, including the politicisation of governance bodies, did not affect the financial performance. The size of the board of directors had a significant influence on social responsibility. In addition, results suggest that the whole board focused on social issues, whereas non-executive members were less concerned about economic issues. Greater money allocation to social welfare programmes resulted in higher profitability, which can be explained by competitive advantages, reputation and customer satisfaction.

Nowadays, some political parties demand either for the creation of a public banking sector or banks with social goals. This paper provides interesting insights into the debate.

The influence of personal attributes of board members on performance needs to be analysed in greater depth in the non-profit sector. The SEM methodology allows us to include some board attributes and performance dimensions in a better way than with other methodologies.

The purpose of this paper is to examine the efficiency and productivity of a Greek bank's branches.

The sample consists of 458 branches of a Greek commercial bank, operating in 13 regions of Greece over the period 2002‐2005, a total of 1,795 observations. Data envelopment analysis was used to explore the efficiency and productivity of the branches. Then, fixed and random effects models were used to determine the impact of internal and external factors on the efficiency and productivity scores.

The results indicate that the branches in the sample could have achieved improved overall performance during 2002‐2005. Also, that the inclusion of loan loss provisions as an input variable increases the efficiency score, but for the total factor productivity (TFP) change, the results are mixed. The second stage regressions indicate that both the logarithm of personnel and the logarithm of income per capita in the local market have a significant impact on efficiency, while the loans to total assets ratio has a significant impact on pure technical efficiency only. When the various productivity change measures were regressed over the explanatory variables, it was found that the logarithm of per capita gross fixed capital formation has a positive and statistically significant impact on all measures. Also, that the return on assets, the loans to deposit ratio, the logarithm of personnel, and the logarithm of income of per capita, all have a positive and statistically significant impact on overall efficiency change.

This paper is the first study on Greek branches which examines the impact of market conditions. It examines the impact of risk‐taking on the efficiency of the branches and examines the productivity growth of the branch network using the Malmquist TFP index.

The purpose of this paper is to compare different approaches to the evaluation of the economic performance of wineries.

This paper simultaneously applies traditional profitability and productivity measures and a non‐parametric technique to estimate efficiency, and compares the results obtained. A cluster analysis has been applied to identify different groups of firms. The empirical application is carried out on a sample of 1,222 Spanish wineries in 2007.

The results reveal important differences depending on the methodology employed. Overall, none of the methodologies can be said to be better than the rest.

This paper has only considered the economic performance of wineries and its findings are not substitutes for other subjective measures directed at the assessment of aspects such as the quality of the wines produced.

Managers should be aware of their own performance in order to guarantee the competitiveness and future investments of their wineries.

For the first time, this paper analyses the economic performance of Spanish wineries, simultaneously using different approaches widely employed in the management literature.

The purpose of this paper is to extend the Du Pont method by connecting productivity and profitability through financial statements focusing on the two most common productivity indicators for companies: total factor productivity (TFP) and labour productivity.

The first part of the paper uses a deductive approach to obtain a new productivity rate of return. The second part applies the methodology of financial statements analysis to develop an empirical application of the findings.

The main finding is a functional relationship among the return on operating assets (ROOA), TFP and labour productivity. From it, the paper obtains a productivity rate of return that synthesizes both productivity measures. The ROOA is broken down into the sum of three parts: productivity, price change, and a crossed effect between turnover and price change.

The model developed in this paper enables analysts and managers to deepen in the causes of margin and turnover and, thus, in the causes of ROOA. To the extent that the separation between productivity and price change effects adds clarity to the knowledge of the causes of ROOA, it creates, at the same time a basis for making more precise decisions in order to improve corporate performance.

This paper differs from other studies by presenting the return of operating assets as a variable that depends on productivity ratios. Financial statement analysis has only occasionally incorporated productivity measures among the variables regarded as the drivers of a companys economic performance.

The purpose of this paper is to understand how a major retailer like Kmart lost its dominant position in the American retail industry.

This paper contains a decomposition of profit change into meaningful economic drivers using a methodology that combines frontier analysis with index number theory. The empirical analysis is complemented with a description of Kmart’s business model produced from corporate documents and other sources.

A quantification of Kmart’s business model performance expressed in monetary terms. This assessment is presented by CEO tenures showing the contribution of different economic drivers to the evolution of profits.

The study’s empirical results highlight the importance of the correct implementation of all aspects of the business model in order to achieve success.

This paper presents a new empirical framework to assess business model performance. Despite Kmart’s important role in American discount retailing history there have been very few studies that have analyzed its downfall. This paper contributes by filling that gap.

This paper aims to explore the relationship between bank market power and stability of financial institutions in Italy between 2001 and 2012. The authors first test the existence of a U-shaped relationship between market power and financial stability. Second, they regress the market share indicator on bank risk-taking to underline whether financial stability is affected by increasing or decreasing the market power of banks. Third, they explore whether this relationship is affected by the size, level of capitalization and credit insolvency of banks.

Relying on highly territorially disaggregated data at labor market areas level, the authors estimate the impact of bank market power and other explanatory variables on a proxy of risk taking behavior such as the banking “stability inefficiency” derived simultaneously from the estimation of a stability stochastic frontier. Bank market power is taken into account through an individual measure based on loans. Financial stability is calculated through the Z-score. The authors use, as risk-taking measure, the stability inefficiency whose estimation approach is the stochastic frontier analysis.

The empirical evidence shows that the inefficiency of financial stability is found to be U-shaped related with respect to the measure of market power. Bank size is an essential factor in explaining the relationship between bank market power and risk-taking. Cooperative banks have fewer incentives to gain market power to better perform in term of risks. The reform of the cooperative banks that took recently place in Italy is not supported by the data.

The relationship between bank market power and financial stability has been analyzed using a rich sample of cooperative, commercial and popular banks in Italy over the 2001-2012 period. The authors rely on labor market areas being sub-regional geographical areas where the bulk of the labor force lives and works. The paper investigates the market power-stability link considering both cooperative and non-cooperative banks. Indeed, specific attention has been paid on cooperative banks because of their mission in favor of the local community as only few studies, to the best of the authors’ knowledge, examine cooperative banking.