Case Studies
Asset Finance
This case study can be viewed as a pdf (57KB).
Problem
A large division of a major high street bank wanted to create extra capacity to achieve cost saving targets.Lean was viewed as a key enabler for development of a sustainable capability through effective and structured skills transfer.
A variety of projects were identified to achieve the capacity release required, whilst training and mentoring staff in lean to ensure future benefits and sustainability:
• Develop an efficient Customer Services telephony department through reduced failure demand, betterplanning & resource management and introduction of staff coaching. Then use freed capacity to combine operations on a single site.
• Streamline retail administration function, following the successful automation of front-end application system for customers and create sufficient capacity for the launch of a new product.
• Consolidate secured loan administration teams onto one site and increase capacity sufficiently for 100% of workload to be handled within the department.
• Improve productivity within the motor finance department and apply lean principles to improve operations.
• Improve effectiveness and investigate one best way in collections environments.
• Train and continue to mentor 21 bank staff in lean techniques to ensure sustainability and internal capability.
Solution
A number of initiatives were instigated jointly between oee and the client:
Customer Services and Sales Call Centre Telephony – Examination of call routing revealed that over 40% were non value adding. Changes to customer IVR options led to a significant reduction in calls and created sufficient capacity within the department to improve skills through side-by-side coaching. Alongside this, highly visual short interval control boards and daily team huddles greatly improved awareness of performance and allowed the teams to generate further improvement initiatives. Finally, analysis of call volumes allowed for better resource planning. Similar changes were made in the Sales Call Centre, though here failure demand was initially at 75%. Of 67 call types, only 21 were identified as value adding – addressing this issue led to immediate improvement in morale and the start of a continuous improvement culture within the team.
Retail Administration – A review of internal processes identified the need to increase multi-skilling and cross-functional team working to better meet changes in customer demand through the day. This was achieved through improved operations management and better coaching of staff. Productivity was also improved through changes to workstation layout and the establishment of key performance indicators on workflow boards.
Secured Loans – A cellular workflow process was implemented which greatly reduced delays and improved team working, leading to improvement initiatives from the team within 2 hours of starting. Introduction of visual management, a one-best-way guide and daily team huddles improved performance further, along with
multi-skilling to improve flexibility and simplify resource allocation.
Motor Finance – A number of kaizen events were run to implement 5S, workflow boards with hourly targets and improved operational management practices. Incoming telephony queues were combined through multi-skilling, reducing delays and hand-offs.
In all cases, the internal project team embedded a member within the department to aid sustainability and ensure that continuous improvement initiatives were maintained.
Results
• Customer Services telephony realised a capacity release of 23%, with customer abandon rates dropping to 1% and team processes recognised as best practice across the division.
• The Sales Call Centre saw abandon rates drop from 18% to 4.5% in 4 months, with transferred calls dropping by 37%.
• Retail administration saw a 21% increase in capacity.
• Secured loans administration increased productivity by over 40%, comfortably allowing it to take on more volume. Freed up capacity was realised.
• Motor Finance productivity increased by an average of 33%.
Card Personalisation Centre
This case study can be viewed as a pdf(55KB).
Problem
A major High Street Bank had made a significant investment in new technology within its Credit and Debit Card Personalisation Centre. The key steps of the core operation were: to take customer data and emboss blank cards, encode the magnetic strip, print and attach the card to a letter and relevant inserts and finally
envelope everything together. Seven new machines were installed to personalise cards with a further integrated machine to complete the process. The benefit was expected to be a significant increase in productivity and capacity which would meet future increases in demand. Current volumes were c.40,000 cards/day, with significant variety in terms of the types of card, inserts and data displayed.
Following the commissioning of the new machines, it was apparent that expected improvements were not materialising, future demand could not be met, and worse still that quality ‘surprises’ were still occurring. These ranged from wrong credit cards being sent to customers to incorrect leaflets placed in envelopes. This
represented a major problem to the Bank’s reputation.
Solution
oee’s approach was to first conduct a thorough operational audit to understand the true performance of the new machinery and understand the potential for improvement. The audit showed that reported efficiencies of 90%+ were incorrect, and that the true Overall Equipment Effectiveness (OEE) of the machines was nearer 40%.
This obviously presented a significant improvement opportunity. The audit also looked at:
• Business Objectives and measures
• Demand Levels
• Layout & Flow
• Planning & Control Systems
• Quality Systems
• Human Resources
An important link was established between batch size and machine performance (OEE) which enabled work to be streamlined into different machines creating an instant improvement. A recommended course of action was implemented over the following 9 months and included:
• Training of supervisors in operations techniques;
• Introduction of an experienced Operations Manager from industry;
• Measurement of OEE and prioritisation of equipment losses;
• Introduction of new centre structure and definition of operational roles;
• Introduction of practical elements of a Quality Management System;
• Introduction of basic workplace improvements such as 5S, visual management, kanban material control, Standard Operations and daily briefings and targets.
Use of local staff proved vital in supporting the change and driving improvements, ensuring that the knowledge transfer from oee was highly effective. It was also clear that the incumbent team leaders would not be able to meet the new operations role and that a longer term HR plan was necessary if the full improvement potential was to be realised.
Results
Over the course of the 9 months, machine OEE was improved from 40-60%, which liberated enough capacity for future demand to be absorbed. The basic improvements to the operation in terms of material control and mistake-proofing also reduced theincidence of quality errors occurring, therefore minimised the impact on the Bank’s reputation. The Centre’sability to absorb change was also increased, which also smoothed the introduction of the next generation of SMART cards.
