Henry Coupe, the manager of a metropolitan branch office of the state Department of Motor Vehicles, attempted to perform an analysis of the driver's license renewal process operations. Several steps were to be performed in the process. After examining the license renewal process, he identified the steps and associated times required to perform each step, as shown in the following table:
Step Average time to
perform (seconds)
1. Review renewal application for correctness
15
2. Process and record payment
30
3. Check file for violations and restrictions
60
4. Conduct eye test
40
5. Photograph applicant
20
6. Issues temporary license
30
Coupe found that each step was assigned to a different person. He observed that the work was unevenly divided among the clerks, and the clerk who was responsible for checking violations tended to shortcut her task to keep up with the other clerks. Long lines built up during the maximum demand periods.
Couple has also found that steps 1 to 4 were handled by general clerks who were paid $6.00 per hour. Step 5 was performed by a photographer paid $8.00 per hour. Step 6, the issuing of a temporary license, was required by state policy to be handled by a uniformed motor vehicle officer. Officers were paid $9.00 per hour, but they could be assigned to any job except photography (photography can only performed by a photographer, however, photographer can also be assigned to other tasks). The branch offices were charged $5 per hour for each camera to perform photography.
A review of the application for correctness indicated in step 1 has to be performed before any other step could be taken. Similarly, step 6, issuing the temporary license, could not be performed until all other steps were completed.
a) Show the layout for the existing license renewal process. What is the capacity of the current process, i.e. how many applications can be processed per hour under the current configuration of the process? Which activities are currently bottleneck?
b) What is the cost per each renewal under the current process design?
c) Without hiring additional people, how the current process can be modified to increase the capacity? (Show the new improved layout). What is the cost per each renewal for the new modified process?
d) Mr. Coupe determined that his office should be prepared to accommodate the maximum demand of processing 120 renewal applications per hour. Can he achieve it without hiring additional workers? Why?
e) If Mr. Coupe hires one additional worker, how would you modify the process? What is the capacity of your new modified process?
f) Suggest modifications of the existing process that would increase capacity to 120 renewals per hour. What is the cost per renewal of the proposed process layout? Can you suggest another cheaper way of increasing capacity to 120 renewals per hour?