1 Identify the inputs, transformation process and outputs in the following operations systems:

a) Bank

The Five Performance Objectives

In order to achieve its organisational and operational goals the bank tries to achieve
an operations-based advantage through the five basic performance objectives. The
five performance objectives in descending order of their priority for the Cheque
Clearance Operations are as follows:

1. Speed: Waiting time in the queues should be minimum and response quick.
2. Quality: Funds should be accounted correctly, the quality and design of the
cheques, passbooks, pay-in-slips etc. should be appropriate and the staff be
helpful and courteous.
3. Dependability: Work should be done as and when promised and should be
reliable.
4. Cost: Customers should receive best services at the minimum cost.
5. Flexibility: Innovative type of accounts meeting specific customer needs and
adjustability of staff inspite of changes in demand.

However we can know the extent to which these performance objectives are giving
Bank of Baroda an operations-based advantage only by analysing the
transformation process at the Cheque Clearance operation.

The Transformation Model

All operations produce goods or services or a mixture of the two, and they do this
by a process of transformation. By transformation we mean that they use their
resources to change the state or conditions of something to produce
outputs.(Slack,N.et al.,1995,p11). All operations confirm to a general Input-
Transformation-Output Model.

The inputs to the Cheque Clearance operations at Bank of Baroda can be

classified as:
Transformed Resources which include the materials, information about the
customers funds, databases, forms, pay-in-slips and even the customers
themselves.
Transforming Resources which include the facilities i.e. the buildings, equipment,
the process technology as well as the staff who operate, plan and manage the
operations who may be at various levels in the organisation.
 The transformation process at the Cheque Clearance operations involve the
physical processing of the materials i.e. the cheques, bank slips received. This is
combined with the processing of information about the customers funds
cashing their cheques and even processing the customers themselves by serving
them appropriately and keeping them happy.

The output of the transformation process includes the banking services, cash,
processed copies of the bank slip, funds transferred. It should be noted here that
though Cheque Clearance operations give an output primarily of service, the
results of these services can be seen in some physical form and it can also be
felt by the customers through its psychological benefits.

A detailed step by step analysis of the operation can be seen in the flowchart
People having come to clear a cheque, either a cash cheque or a payees account
cheque move to the respective counter to get it processed. In case of payees
account cheques the customer takes back the processed bank slip and leaves, while
in case of cash cheques the customer is asked to prove his identity, if necessary and
is issued a token with a number. The job of the employee at both the cash cheques
and payees account cheque counter consist of processing the cheques manually
while the cashier displays the number of a token on a LCD screen indicating that
the person with the displayed token number can come and collect the cash.

Capacity Planning

Capacity is a measure of an organisations ability to provide customers with the

demanded goods or services in the amount requested and in a timely
manner.(Vonderembse and White,1996, p286). Proper planning of capacity is
essential for every organisation as it influences the various performance objectives
that can be achieved by the operations.
The first step in any capacity planning is to forecast demand fluctuations. It has
been noticed that Bank of Baroda experiences hourly demand fluctuation at it's
Cheque Clearance operations, which require capacity adjustments. The long-term
demand forecasts are also positive with pressing needs for breakthrough capacity
improvements.
The next step is that of measuring capacity which has been explained below:

Through observations it has been found out that individual jobs at the Cheque
Clearance counter consist of different activities. The various activities and the
average action time for the same are as follows:
Cash Cheques:
Receiving and Processing 60
seconds Transfer to Cashier 15 seconds

Payees Account Cheques:

Processing Time 90 seconds

Cashier:
Receiving processed cheque
from Cheque Clearance counter 15 seconds
Entering number on screen 15 seconds
Delivering cash to customer 15 seconds

Number of Hours / Week:48 hrs. / week

Capacity / Week :
Cash Cheques Counter: 2304 Cash Cheques / week
Payees Account Cheques Counter:1920 Payees Account Cheques/ week
Cashier: 3840 Deposits or Withdrawals / week

Having understood the demand fluctuations and capacity, the next step is to
consider the alternative methods of adjusting to the fluctuations. Bank of Baroda,
at present performs the Cheque Clearance operations by providing a server each at
the Cash Cheques, Payees Account Cheques and the Cashier counter. However it
has been observed that the operations is suffering from a deficiency of
mechanisation i.e. the operations bottleneck lies in the processing time which is
causing significant delays as almost the whole of the operation is done manually.
Introduction of machines like ATMs and other self processing machines can help
the system, by reducing the processing time, to respond to its demand and reduce
other resource requirements. This can be further utilised as a marketing tool to
provide varying service types in the form of Express Counters or Drive
thru Cheque Clearance on a self service basis. Such measures can go a long way in
reaching customers located in out-of-the-way places, when combined with
measures such as UAESWITCH. Although Bank of Baroda makes forecasts of
their expected average level of demand, due to the probabilistic arrival and
processing time only rarely do the arrival of customers match the ability of
operations to cope with them. Inspite of the division of work, long queues build up
at some counters while others remain idle. Such a problem can only be solved by
effective manpower planning by training the employees at the Cheque Clearance
operations in other operations as well, and by strategies such as job enlargement
 and job enrichment. Through scientific management techniques of time and motion
study the job should be designed ergonomically which is both satisfying and
motivating to the employees. Instead of having separate cash cheques and payees
account cheques counter, the bank should have three cashier counters with the
customers having the liberty to move to any counter for any type of cheque
clearance operation required and get the cash from the same counter as well. This
will not only reduce processing time but also reduce the customers queue at any
given time, thereby helping the bank meet its demand to the fullest extent with
ease.

b) Hospital

Often all three types of input materials, information and customers are transformed by the same
organisation. For example, withdrawing money from a bank account involves information about the
customer's account, materials such as cheques and currency, and the customer. Treating a patient
in hospital involves not only the customer's state of health, but also any materials used in treatment
and information about the patient.
One useful way of categorising different types of transformation is into:
manufacture the physical creation of products (for example cars)
transport the movement of materials or customers (for example a taxi service)
supply change in ownership of goods (for example in retailing)
service the treatment of customers or the storage of materials (for example hospital wards,
warehouses).

c) Educational institution