Manzana Case Study

Recommendations

Based on the findings of our analysis, we recommend the following:

combine three queues for underwriting teams into one queue What?

Manzana should combine the replace existing three queues in underwriting procedure with only one queue for all three teams. Three underwriting teams should therefore be combined into only one bigger team (1 department), disregarding the geographical territories.

Why?

Queueing theory suggests that it is better to have one line leading to more servers than more lines leading to more servers. We will test this theory in our example.

Effect:

When combining the lines and underwriting teams the total capacity of the resource equals 0,82 (before teams had total capacity of 0,92, 0,83 and 0,71 respectively). More importantly, the waiting time before underwriting process decreases to only 0,068 days (30,6 minutes), causing the actual flow time of the entire process decrease to 0,617 days (277 minutes). Also, average inventory equals 2,66 requests (see Appendix 1 for calculations).

combine three queues for undriwriting teams into one queue plus hire a new distribution clerk. What?

Hire a new distribution clerk.

Why?

Total capacity of existing four distribution clerks is very high (0,89), which in turn causes high inventories and high waiting lines. If we take into account that distribution clerks are reponsible also for analyzing and disseminating data published each month by the state insurance commissioner (besides distributing requests to underwriting teams) it is obvious that there aren't enough distribution clerks in the company.

Effect:

By adding additional distribution clerk (as well as combining underwriting teams into one team) actual flow time of the entire process would decrease to 0,54 days (244 minutes). Waiting time before distribution clerks would decrease from 0,09 days to 0,015 days and inventory would decrease from average 3,52 requests to 0,59...