Problem: Turbo Underwriting

Turbo Underwriting offers customized loans. Customers call a toll-free number with a specific loan request, and typically obtain a response the same day. Turbo Underwritings business process includes six activities which must be conducted in the sequence described below. (The time required for each activity is shown in parenthesis).

Activity 1: Answer customer call and record key information. (4 minutes/loan application),

Activity 2: Gather and format the information (obtain credit scores, organize customer specific needs) for analysis (5 minutes / loan application),

Activity 3: Analyze the information: Check the credit worthiness and decide loan amount and APR to offer. (7 minutes/loan application),

Activity 4: Collect social media information about the customer and feed this information into a proprietary machine learning system (4 minutes / loan application)

Activity 5: Perform final checks on loan offer (2 minutes / loan application),

Activity 6: Call customer back with the new loan offer and close or inform about the rejection decision. (5 minutes / loan application).

All six activities need to be carried out, independent of the customers loan application being accepted or not. The whole process is conducted by four associates.

Associate 1 performs activity 1 and 2

Associate 2 performs activity 3

Associate 3 performs activity 4 and 5

Associate 4 performs activity 6

Each associate is paid $50 per hour. You can assume that there exists unlimited demand and that loans are only entering the process at the rate of the bottleneck.

What is the average labor Utilization?