North West
Constructive Bank
Team Members:
• Alvino Johan
• Arfan Wiraguna
• Clara Nadya Puspasari
INTRODUCTION
Name : Andy Curtis
Position : Mortgage Operation Manager
of North West Constructive Bank
Responsibility: Running the new applications
process by leading a project team to consolidate the Bank original
three mortgage-processing centres (‘Northern’, ‘Southern’, and
‘Western’ applications) into one new site.
Advantage: Could make significant savings by consolidating all our
operations.
Main Problem: Worse turnaround time
The new applications process
Input
Underwriting
Offer
Completion
Demand
•
The ‘discounted rate’ product had been seen as very
attractive by the market
•
Unfortunately, when the news of the imminent
demise of the discounted rate product broke there
was a final surge in demand
Problems with the new process
• ‘First, the move itself was bound to cause some
disruption and has created an uncertain and unstable
environment in which to cope with our other problems’
• ‘Second, the last-minute rush on our discounted rate
product meant an extra load above what we expected
and hit us just at the wrong time’
• ‘Third, although we have only been operating with the
new layout for four weeks, it’s clearly not working as it
should’
A list of the third point key problems:
• Staff were having to move about more than at the old
centres
• Therefore because of the effort in retrieving a file, staff
were keeping it on their desk, out of the filing system, for
longer than necessary, ‘in case it was required again’,
making it unavailable to any other member of staff
• All the scanning machines were located together in one
location to maintain a high utilization of the machines, but
again, this meant that staff had further to walk
• There was no clarity of flow
RBC Bank - Mortgage Process Guide
• Example
The volume–variety position
• The old centres
The volume–variety position
• The new centres
8
Redesigning the Process: Option 1
Keep the process,
as it is at the new
centre
Data entry stage
serving all regions
The three regions
each having their
own underwriting,
offer, and
completion
Not disrupting the existing way of working
Maintaining the organizational coherence of the three teams
Redesigning the Process: Option 2
Organizing 4 sequential
teams of the 4 stages of
data entry,
underwriting, offer,
completion
- More appropriate
for the higher
volume.
- Allow some skills to
be developed.
Offer team would
probably still have to
retain some local
‘cells’ within the
process
- Affect the morale of the
existing regionally based
teams.
- The offer team have to
learn the local knowledge of
the regional market.
Redesigning the Process: Option 3
Reorganizing into 4
teams of the 4
stages within the
process
Short
throughput
times
Operating the
underwriting stage
and offer stage in
parallel
Risky,
especially with
such high levels
of recycled
applications
We choose: OPTION 2
• Clear flow
• Scanning machines and file storage issues had been addressed
• Can eliminate the demand rush of ‘discounted rate’ product
Recommendation: Option 2
• Training skill per stage
• Team building to bound the employees of each
stage
• Underwriting and Offer Stage: Learn more about
local knowledge of each regional market. Share
information between colleagues. Still retain the
local ‘cells’ within process.
Recommendation: Improvement
• Policy to keep and return the file.
• For the long-term improvement, the company should
make Standar Operating Procedure, for offer stage.