Question
Management of the first Syracuse bank is concerned about a loss of customers at its main office downtown. One solution that has been proposed is
Management of the first Syracuse bank is concerned about a loss of customers at its main office downtown. One solution that has been proposed is to add one or more drive through teller stations to make it easier for customers in cars to obtain quick service without parking. Chris Carlson, the bank president, thinks the bank should only risk the cost of installing one drive through. he is informed by his staff that the cost (amortized over 20 year period) of bluing a drive through is $12,000 per year. It also costs $16,000 per year in wages and benefits to staff each new teller window. The director of management analysis Beth Shader, believes that the following two factors encourage the immediate construction of two drive through stations, however. According to a recent article in banking research magazine, customers who wait in long lines for drive-through teller service will cost banks an average of $1 per minute in loss of goodwill. Also, adding a second drive through will cost an additional $16,000 in staffing but amortized construction costs can be cut to a total of $20,00 installed together instead of one at a time. to complete her analysis, Shader collected one month's arrival and service rates at a competing downtown banks drive through stations. This data are shown as observation analyses 1 and 2 in the following tables. a. Stimulate a one hour time period from 1 pm to 2pm for a single teller drive through b. Simulate a 1 hour time period, from 1 pm to 2pm, for a single line of people waiting for next available teller in a two-teller system. c.Conduct a cost analysis of the two options. Assume that the bank is open 7 hours per day and 200 days per year Observation analysis 1: interarrival times for 1,000 observations Time between arrivals Number of occurrences 1 200 2 250 3 300 4 150 5 100 Observation analysis 2: customer service time for 1,000 customers Service time (minutes) Number of occurrences 1 100 2 150 3 350 4 150 5 6 150 150
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