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 applicationsprocess 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 old centres

The volume–variety position

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 2Organizing 4 sequential teams of the 4 stages of

data entry, underwriting, offer,

completion

Offer team would probably still have to

retain some local ‘cells’ within the process

- More appropriate for the higher

volume. - Allow some skills to

be developed.

- 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

Operating the underwriting stage and offer stage in

parallel

Short throughput

times

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.