The Issue of a Gold Coast Savings Bank - Case Study Example

Table of Contents Executive Summary 1 Introduction: 2 Current Process Flow and an Analysis: 2 Issues in the Process Flow: 7 Redesigning the Process Flow: 8 Conclusions: 14 Bibliography 16 Executive Summary Gold Coast Savings Bank is a case study of a bank which has been facing a sudden increase in the request for refinancing of the home loans. This report has been created after a through investigation as to why the bank has been faced with this issue. The report includes a clear illustration of the current process flow of the company which provides for a better understanding of the how the bank is currently processing the requests. This also provides for an analysis of the potential issues of the bank and the current process flow. The report contains a clearly chalked out set of issues based on the knowledge gained from the case study and the customer comments. Banking is completely customer centric and it is essential that if customers have an issue a well planned step to correct the problem is taken. Based on this the set of issues that have been chalked out are then used to improve and redesign the work flow of the process. The main reason for the redesigning is to ensure better use of the resources, to cut down the cost adding steps to be reduced, inclusion of value adding steps and last but not the least, to increase the levels of the customer satisfaction. Introduction: Gold Coast Savings Bank has designed a new process flow for the refinancing for the home loans. The company has been faced with a number of requests during the year, and developing a process which is effective as well as fast has become a prime concern for the company. The current process flow of the bank is one with a number of issues and loop holes which is the major cause for the process to go haywire and is also now leading to a number of customers who are dissatisfied. If Gold Coast Savings Bank does not take any action immediately there is a major threat that the bank could loose a number of its current customers. This report mainly analyses the current process flow of the bank and recognises the glitches in the process flow. Also it provides Gold Coast Savings Bank with a new process flow to meet up to the needs of the customers and provide the customers with better services. The new process flow will also provide for Gold Coast Savings Bank with a more effective and efficient process which will reduce the work load as well as help organise the entire process. Current Process Flow and an Analysis: Gold Coast Savings Bank has developed a process flow at present for the refinancing of the home loans. This process flow has been designed with a lot of care to ensure that the customers’ needs are met up. The process flow shows that the bank has taken into account all the possible events that could affect it and has also used all the possible protocols to ensure safety of their funds. The current process however has been built due to the sudden rise in the number of requests that have been received for the refinancing of the home loans. The current process flow of the bank has been illustrated below. Based on the above illustration of the process flow, it is seen that Gold Coast Savings Bank has covered every step in the process to ensure that every possible aspect of the application is well covered. There are a number of different well qualified personnel who have been included for every step which thereby ensures that every step has a professional who would be aware of the various laws and rules which relate to the process. This is a very beneficial idea as it reduces the load of work on the employees and allows the employees to concentrate on one particular part of the flow. Also with the use of this kind of specialist idea will provide for the processes to be completed faster. The waiting period of this kind flow is however very long for the customers and this leaves the customers unsure of whether or not they would receive the refinancing on the loan. The inclusion of a lawyer as a part of the entire process is also a very well thought out step to ensure that all the steps like the inspections, title search and others is handled by the lawyers and does not require hiring more resources to complete the job. Also the need for credit checks is essential specially during the current period where there is a high economic slowdown and the amounts of money required by the countries is getting higher and higher. The overall use of the process flow is good however there are a number of places where issues still crop up. Also there are a number of places where the flow can be optimised and the process can be made more effective and efficient (Anderson, 1999). Considering the comments of the customers and the issues that they face, it is important for Gold Coast Savings Bank to take serious steps and to improve the process flow to ensure higher effectiveness and efficiency. Issues in the Process Flow: Looking at the feedbacks provided by the customers, and the various complaints, it is clear that Gold Coast Savings Bank has not planned the process well and there are a number of places where improvements can be made. The customers have faced a number of issues due to the process flow not being complete and effective. This has lead to the bank receiving a number of complaints and also negative feedbacks. In a time where the banks are faced with such high volumes of requests, it is essential that there is a well thought out, simple and straight forward process flow that is set out and used to ensure lesser or no errors and also providing the customers with services which needs minimum steps to complete. If the process flow is noted, the number of steps and the number of people involved in completing one request are very high. This is one of the major issues of the process flows and requires to be reduced to the maximum possible to ensure better end results (Mitchell & Chaman, 2007). It is understandable from the view point of the bank that a number of checks need to be completed before sanctioning a request for the refinancing of home loans. This is majorly because the only people who would loose in case the individual requesting for the refinancing does not pay back would only be the banks. Hence it is required for the safety of the bank that all the checks are made. However considering this from the point of view of a customer, it is seen that the customers are being faced with very long waits and since there are a number of different people handling the same process at various different parts, the customers have needed to explain the situation to each person. There is also a slack on the side of the employees of the banks and there seems to be a lack of responsibility on the end of the bank employees’. There have also been issues that have been raised where the customers have had problems with their loans due to the lack of proper and timely communications from the bank. The process is very elaborate and there seems to be no well defined communication among the employees themselves as well as with the customers. This is a very serious issue and requires a lot of attention. The lack of communication among a business and its customers is one of the major reasons and can also be the underlying factors for the businesses going into losses (Inagaki, 2007). There have definitely been a number of factors which need to be considered and a number of protocols that need to be followed to ensure complete safety for the banks as well as the customers. Redesigning the Process Flow: Keeping in mind the customer feedback and the important concepts of value chain analysis and the important concept of service value chain the process flow has been redesigned. However before going on to the redesigned process flow, it is essential to firstly understand the position of the Service Value Chain in the banking industry. The Service Value chain as seen below mainly deals with the ability of a company or service provider to use it human resources in the best possible manner to increase customer satisfaction and also along side ensuring that the employees are happy and satisfied at the job. It is essential to understand that for every business, if the customers are important, the employees are also equally important. Ensuring that the employees are satisfied and happy workers will lead to better results at work and thereby more satisfied customers as well. Also, if the customers are happy the loyalty will increase and thereby the employee satisfaction will also increase (Graham, 2004). Figure: Service Value Chain (SDS Research, 2008) Based on this concept, the process flow has been redesigned and this will prove to be more beneficial for Gold Coast Savings Bank, not only for customer satisfaction but also in terms of the cost – adding steps which can be reduced. The below diagram illustrates the new process flow for the bank. (Joiners, 1995) The process can be changed to a great extent as there are a number of places where the process is repeated. As per the redesigned plan, the customer would be assigned to one particular ‘Customer Relations Officer’. This person would be the first point an only point of contact for the customers. The customer relations officer’s main duty is to act on behalf of the customer and to deal with the various different departments to ensure that all the papers are in place. In the first meeting with the customer the Customer Relations Officer will get the application forms filled out by the customer, the credit checks if necessary, the preferred interest rate locked and also the lawyer details. This is to ensure that the customer provides all the information in the first step is not required to come back and forth for every step of the process. The customer relations officer will check to see that all the papers provided by the customer is in place and all the required information for the processing is in place before letting the customer leave on the first meeting. All the information is then forwarded to the loans officer from the customer relations officer. The loans officer will go through all the information and check for the credit ratings, and whether the customer requires the loan or not and also checks if the customer meets up to all the required criteria for the refinancing. The loan officer will approve or disapprove the loan at this stage. If he approves the loan at this stage, then the papers will be sent to the closing officer. If the loans officer disapproves the loan, then the papers are sent back to the customer relations officer and the news needs to send to the customer. If the loan has been approved, once the papers are sent to the closing officer, the closing officer would get in touch with the customers lawyer to complete all the formalities and to finalize the details like the fees, the dates and other aspects of the loan. It is important to note that throughout the process, the first point of contact for the customer will be the ‘Customer Relations Officer’ and also for the backend processing, like the loan officer and the closing officer would require to get in touch with the ‘Customer Relations Officer’ for any doubts, enquiries or any information. Thus the only person facing the customer will be the ‘Customer Relations Officer’ and he would have all the information about the loan. In case any further information is required during the processing of the loan, the ‘Customer Relations Officer’ would contact the customer over the phone and request for all the information needed. Once the loan is closed with the customer, the loan details are forwarded to the loan payment specialist team and a member is assigned to the particular loan. The loan payment specialist and the customer relationship officer communicate and decide on the schedule to close the old loan and also to set up the schedule for the payments and the withdrawals related to the new loan. Care is taken to ensure that timely payments are made to close the old loan. This process is made easier as the customer relationship executive is fully aware of the loan history. The monitoring process is then handed over to the loan payment specialist. In case of any issues, the customer can contact the customer relationship executive. The loan payment specialist also ensures that the customer relationship officer is kept informed about any problems or issues that may arise during the course of the new loan. Conclusions: Based on the case study of Gold Coast Savings Bank this report has dealt with a very essential aspect of the business is the process flow of one of the activities namely the refinancing for home loans. With the increased number of requests, the bank requires to develop a process plan which is more effective and efficient. The report contains a clear analysis of the problem that the Bank is currently facing and has included a redesigned process flow based on the issue of communication. There has been a clear explanation of the various concepts of operations management and a strong link has been created between the case study and the theories that have been studied. As discussed the main aim of the report is to make the process of Gold Coast Savings Bank more effective and efficient. The redesigned process flow chart helps ensure that the customers are satisfied and there is a complete level of an effective and efficient process rather than having a process which seems very confused. This report has covered the major aspects of operations management and provides a clear step by step methodology that can be used by Gold Coast Savings Bank to improve its current process flow and to save as much as time and resources on the same. Bibliography Andersen, B., 1999, 'Business Process Improvement Toolbox', June 1999, ASQ Quality Press Graham, B.B., 2004, 'Detail Process Charting: Speaking the Language of Process', 2 August 2004, Wiley Publishers Inagaki, N., (2007), ‘Communicating the Impact of Communication for Development: Recent Trends in Empirical Research (World Bank Working Papers)’, 27 July 2007, Illustrated Edition, World Bank Publications Joiner Assosiates Staff, 1995, 'Flowcharts: Plain & Simple: Learning & Application Guide', 1st edition, July 1995, Oriel Incorporated Publishers Mitchell, P., & Chaman, K., (2007), ‘Communication – based Assessmentfor Bank Operations’, Illustrated Edition, 30th July 2007, World Bank Publications SDS Research, (2008), ‘The Service Value Chain’, Accessed on 12th May 2009, Retrieved from http://www.sdsresearch.com/service_value_chain.html Slack, N., Chambers, S., Johnston, R., & Betts, A., (2006), ‘Operations and Process Management’, 1st Edition, Prentice Hall Publishers Slack, N., Chambers, S., Johnston, R., & Betts, A., (2008), ‘Operations and Process Management’, 2nd Edition, Prentice Hall Publishers Read More