Question: Del, every wire transfer request is processed first-come-first-served. Some of these wires are for millions of dollars, while others are under $100, said Betty Kelly,

"Del, every wire transfer request is processed first-come-first-served. Some of these wires are for millions of dollars, while others are under $100," said Betty Kelly, a 28-year-old manager of Cash Movement (CM). She continued, "I'm also concerned that all wires regardless of dollar amount go through the same quality checkpoints and whether we are staffed correctly."

Betty left her boss Del Carr's office with many related issues on her mind. As Betty sat down in her office chair, Steve Breslin, supervisor of outgoing wires, said, "Betty, last week we processed a wire for $80,000 incorrectly to Houston Oaks Bank, and now they won't give it back. What should we do?" "Steve, give me the information, and I'll call the bank now," said Betty. The rest of Betty's day was spent recovering this money and discussing several personnel issues.

The Cash Movement (CM) operating unit is respon-sible for transferring money for BankUSA and any of its customers. Over 80 percent of all transaction requests are for individual customers, and the remaining requests are for commercial (business) customers. For example, a cus-tomer will sell stock and request that cash funds be sent to another institution such as a mutual fund, credit union, or another bank. The customer will request his or her local customer investment manager (CIM) to transfer money into or out of the account. The CIM will then request by e-mail or fax that Cash Movement process the transaction. All wires must be settled on the same day.

The average demand for outgoing wires is 306 wires per day for a 7.5-hour workday. Therefore, the cycle time for this demand rate using Equation 8.2 is computed as follows: 55

CT = A/R = [(7.5 hours/day)(60minutes/hour)] /(306 wires/day)

= (450 minutes/day)/(306 wires/day)

= 1.47 minutes/wire

Cash Movement employs 21 people, with three managers, 11 associates in outgoing wires, two associates in incoming wires, three associates in checks, and two associates in other areas. The average annual salary per associate is $30,000 with an additional 30 percent for benefits and overhead costs. Overhead costs include the cost of leasing/ renting the building, operation of common areas such as the cafeteria and meeting rooms, utilities, insurance, and photocopy services.

Process workflow is documented in Exhibit 8.19, with 47 detailed steps consolidated into 16 logical workgroups/ activities. The processing times in the last column are based on stopwatch time studies. The weighted average time per outgoing wire is 7.05 minutes. A total of 11 people work in this process. The assembly line could be balanced using the original 47 steps if the times per step were given (they are not), but Betty thought she would begin by trying to balance the line using a more aggregate grouping of work with 16 workgroup activities. The 16 work activities are per-formed in a series or sequentially, but how they are grouped does make a difference.

Question: Del, every wire transfer request is processed first-come-first-served. Some of these wires are for millions of dollars, while others are under $100, said Betty Kelly,

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