Queue Line Problem (Operations Management)

Global Financial's loan application process is the subject of this case. Customers are unhappy with the slowness of the process, and a major competitor promises to process loans much faster. The current process design is to separate the load processing into three regions. There are 4 steps in loan processing as shown in the process chart.

How would you redesign the below loan processing flow so that the loan can be approved in minized. what is the processing time for the new design?

1. Each workday = 6.3 processing time.
2. There are two types of loan requiring different processing time

Type	Processing Time	% of TTL volume	Processing Time (Mean)
Standards	Has a history of quick turnaround time	40%	10.7
News	more complicated take longer time	60%	15.8

3. Estimated Processing Capacity: 6.3 hours workday and 410 hours for the entire quarter

Processing Step	Available staff	Capacity (staff x 410 hrs)
Evaluation and Analysis	3 teams	1230
Interest Rate	person	205
Loan Terms	2 persons	1230
Final Issuing	3 persons	820
Total capacity		3485

4. Estimated Processing in Hours

	Standard	Standard	New	New
	Mean	Std Dev.	Mean	Std dev
Evaluation and Analysis	2.8	1.2	6.1	3.0
Interest Rate	0.6	0.2	0.6	0.2
Loan Terms	3.8	1.4	5.6	2.6
Final Issuing	3.5	1.2	3.5	1.2
Total	10.7	5.1	15.8	2.9

Global Financial Loan Application Processing Region 1 Applications queue Region 1 Evaluation & Analysis queue Region 1 Loan Terms Final Issuing Region 2 Applications queue queue Region 2 Evaluation & Analysis queue queue Interest Rate Region 2 Loan Terms Region 3 Applications Final Issuing queue queue Region 3 Evaluation & Analysis Region 3 Loan Terms Global Financial Loan Application Processing Region 1 Applications queue Region 1 Evaluation & Analysis queue Region 1 Loan Terms Final Issuing Region 2 Applications queue queue Region 2 Evaluation & Analysis queue queue Interest Rate Region 2 Loan Terms Region 3 Applications Final Issuing queue queue Region 3 Evaluation & Analysis Region 3 Loan Terms