OPERATIONS MANAGEMENT

ARAPU Case Study

AMOGA – RANJANA – VIPINKUMAR

Agenda
● Introduction
● Objective
● Process Flow
● Problems
● Process Design
● Constraints & Opportunities
● Subprocess & Success factors
● People Impact
 Introduction

ARAPU LONDON, UK Susan N’tini

Action Response Application Processing Unit Critical Situations
CEO
Objective

EFFICIENCY SPEED MINIMISE COST TRUST

Process Flow
Applications/week (Intermediary Charity)
300 via fax/post/online Request
additional
info.

Waiting time 1 to 8 weeks

No 2 batch/day

Info. Yes Send Shortlisted Assign

Receive Feed Key
Check Comp application to Unique
application Coding clerks info.
lete? identifier
Forward to
2 Receipt Clerks, 10min/application 2 Secretary’s Desk
Receipt Clerks checking application 5 Coding Clerks, 20min/application
Status

Secr
etary Unusual Cases
Desk

Yes Stored for

Trustee review

Ambi No
Assign job Detailed
Scanning guous Assessment
Approved/Declined
to assessor Committee of
?
trustee folder
10 mins

7 Application assessors, 60min/application CONTD…..

 NA
Committee of trustee folder NOT OK

OK
Review
1. Approved/Declined Guidelines

Forward to
Completion officers
Detailed Approved/
2. Unusual Cases
review Declined

Committee of trustees, Weekly meeting (Thursday)

All Applications - 7 Completion officers

Yes
Compile Provide Final file
Declined Advice
response Advice &response

NO
3 Decline officers , 30 mins/application Mail
applicant
Payment Queries NO
Create Final file
Approved instructions to from
Letters bank &response
bank
2 Dispatch Clerks,
Yes 10 mins/application
4 payment officers , 50 mins/application
Problems

BOTTLE NECK LONG WAIT HIGH COST

NO STATUS UPDATE UNEVEN WORKLOAD NEGATIVE PUBLICITY

 Process Design
Delivery of
Added Value Aid recipients/Intermediary charities
Status
Apply Support check More info. Info. Shared Accepted/Decline Feedback
Advice
Application ID Transfer

Check
Application form Application Check Application
Application form Application (Complete/Inco Add. Info. Application Status Payment
Sales/ (online,fax/post)
Application form
(online,fax/post)
Receipt
Application
Receipt
Check
(Complete/Inco
mplete)
(Complete/Inco
Add. Info.
Add. Info.
tracking
Application
tracking
Status
Status
Payment
Payment
mplete)
Delivery (online,fax/post) Receipt mplete) tracking

Value Assigning Unique Feeding Key

Form Review
Identifier information
creation

Scanning & Sorting Flagging Decision

Scanning & Sorting Flagging Trustee Decision
Task Assign Scanning &
detailed (Accepted/dec
Sorting FlaggingUnusual Trustee Decision &
Task Assign detailed
assessment (Accepted/dec Unusual Trusteemeeting &
lined) cases Dispatch
Backend Support Task Assign detailed
assessment
assessment
(Accepted/dec
lined) Unusual
cases
meeting
meeting
&Dispatch
lined) cases Dispatch

Support Team
Support Team

Suppliers [Software companies -IT Systems] | [Bank - Payments]

Constraints & Opportunities
Reshuffling resources (TOC)
Time required for application
(min)

Time required for 400 Number of days (35

Total number application/resource hours a week) - 7 hours Resources
# Task/Stage 1 300 +100 = 400 of resources (min) per day 5 days a week Ratio of each task Needed
1 Receipt 10 4000 4 1000 2 8.70% 2
2 Coding Stage 20 8000 5 1600 4 17.39% 4
3 Assessment Stage 70 19000 7 2714 6 41.30% 10
5 Decline 30 4500 3 1500 4 9.78% 2
6 Payment (approve) 50 7500 4 1875 4 16.30% 4
7 Dispatch 10 3000 2 1500 4 6.52% 2

46000 25 Total Days Required 24 25

Inefficiency in Process Improvement in current system

The whole process output is 300 claims processed per week and
from the case there are around 2000 claims in process at any given
time. Unit operates 35 hours per week.
The flow time of the whole process is = 35/300 = 0.12 hours
● Inventory (WIP): 2000 claims
● Flow Time: 0.12 hours (per claim)
● Throughput: 300 claims/week
Total time taken by all resources = 46000 min
Total time allocated = 35*25*60 = 52500 min
Extra time = 52500 - 46000 = 6500 min
We have 6500 min extra in which resource are sitting idle with
no work. As each resource take 2100 min to finish certain
activity so we can reduce the headcount by 3.

Current Flow Time Calculation:

Flow Time = Inventory/Throughput

Flow Time = 2000 claims/300 claims/per week

= 6.67 week
= 6.67 * 35 hrs per week
= 233.45 hrs
Reduce headcount to minimize operational cost

Time required for application (min)

Current Rounding off for

# Task/Stage 1 300 +100 = 400 resources Resources Needed Resources needed
1 Receipt 10 4000 4 1.9 2.00
2 Coding Stage 20 8000 5 3.8 4.00
3 Assessment Stage 70 19000 7 9.0 10.00
5 Decline 30 4500 3 2.1 3.00
6 Payment (approve) 50 7500 4 3.6 4.00
7 Dispatch 10 3000 2 1.4 2.00

46000 25 21.9 22.00

Time allocated per resource = 35 * 60 min = 2100 min

Resource Needed = time taken per resource / Time allocated per resource
Total Resources saved (%) = (25-23)/25 *100 = 12.00% (saved 12% operational cost)
Total resources saved (Number) = 25-22 = 3
Improvement Strategies in ARAPU (Little’s Law)
● Automate Routine Tasks: Automation can reduce the time spent on data entry and coding. Assume automation reduces this by 50%.
● Centralized Database System: This can significantly reduce the time spent on locating files and answering status inquiries. Assume a
20% reduction in delays.
● Dedicated Case Managers: This role can streamline the process by ensuring each case moves smoothly through the system. Assume a
30% reduction in overall processing time.

Estimated New Inventory:

New Inventory (I) = 2000 claims * (1-0.5) = 1000 claims

New Flow Time Calculation:

Flow Time = Inventory/Throughput

Flow Time = 1000 claims/300 claims/per week

= 3.33 week

= 3.33 * 35 hrs per week

= 116.55 hrs
Subprocess & Success factors
Requiring further Information

Subprocess Input Output Findings Changes & KPI

Checking the Applications Application is Some applications Standardized online

application received at receipt validated require additional forms/templates
information clerk’s desk information and Checklists to
cut down the time
consumed for initial
validation

Incomplete Application is - Error rate reduction

applications that are reviewed again in assessments and
sent back with completions.
additional
information

Application sent to Complete Application is - Average processing

coding clerks applications with forwarded to further time per application
the required processes using standardized
applications.
information
Tracking Application Status
Subprocess Input Output Findings Changes & KPI

Tracking the status of Application status / Individual file is Time consuming, 2 New IT systems with
application information requests found to share the receipt clerks are real-time status
information to employed for this update features and
requestor task dashboard to make
finding the status
much easier

Employees trained to Status requests from Accurate and fast - Reduction in

use the IT systems applicants / charities response of status applicant inquiries
shared & information about status
about real time
status check features
are informed to
requestors
Coding Stage

Subprocess Input Output Findings Changes & KPI

Allocating unique Applications Allocate a unique It takes 20 minutes From the online
identifier and key in received at coding identifier and key in for each application forms, auto ID
information clerk’s desk information on the in the coding stage creation would be
system done and
information would
be extracted as
needed to cut
down the time
taken in coding
stage
Trustees Approval

Subprocess Input Output Findings Changes & KPI

Trustees meet for Accepted/declined Review, ensure if Trustees only meet Guidelines adherence
approving the applications guidelines are met once a week and all evaluation done using
assessors’ decisions and approve / the files are on hold AI tool (Sirion contract
decline waiting for their management) after the
approval assessor’s validation
instead of trustees’
approval

Unusual cases Review and offer Only unusual cases are Reduction in total
forwarded from solutions kept on hold waiting number of applications
assessors for the approver’s on hold for approval
from trustees
decisions
Acceptance / Rejection Letters
Subprocess Input Output Findings Changes & KPI
Sending out rejection Application rejected Decline officers draft a 30 minutes taken to draft Auto-generated rejection
letters by trustees suitable response the letters manually letters on a click with
pointing out why the standard templates from
the new IT systems to cut
application failed and down time used for
offering advice if possible manual drafting and
sending of letters
(docusign tool)

Sending out acceptance Application Payment instructions Standard letters are used Tool to get the payment
letters and payment approved by trustees to the bank and for acceptance forms filled with the
instructions acceptance letter is banking information fed
sent from the application file
(automated in the initial
process & using Mail
Merge tool). Acceptance
letter is sent in a click as
well.
Revised Process Design
Delivery of
Added Value Aid recipients/Intermediary charities
Accepted/Decline
Apply Status check based on More info. Info. Shared Advice Feedback
First name Application ID Status check Transfer

Check
Application form Application Check Application
Application form Application (Complete/Inco Add. Info. Application Status Payment
Sales/ (online,fax/post) Receipt (Complete/Inco
(Complete/mplete) Add. Info. Online tracking Status Payment
All(online,fax/post) Receipt
application online forms mplete) Add. Info. tracking
Application Status Payment
Delivery Incomplete)
tracking

Value Auto ID creation

Trainings Form Review Internal Dashboard
creation and Segregation

Scanning & Sorting Flagging Decision

Scanning & Sorting Flagging Trustee Decision
Task Assign detailed (Accepted/dec
Sorting Unusual check Trustee
Guidelines Decision &
Task Assign detailed
assessment (Accepted/dec Unusual meeting &
Detailed Assessment lined) cases and letter Dispatch
Backend Support assessment (Accepted/dec
lined) (automated)
cases
meeting &Dispatch
lined) templates Dispatch

Support Team
Support Team

Suppliers Training Platforms [Software companies -IT Systems] | [Bank - Payments]

Calculation based on improved system

Time required for application (min)

Current Rounding off for Resources

# Task/Stage 1 400 resources Resources Needed needed
1 Receipt 5 2000 4 1.0 1.00
2 Coding Stage 10 4000 5 1.9 2.00
3 Assessment Stage 35 9500 7 4.5 5.00
5 Decline 15 6000 3 2.9 3.00
6 Payment (approve) 25 10000 4 4.8 5.00
7 Dispatch 5 2000 2 1.0 1.00

33500 25 15.95 16.00

Time taken per resource = 35 * 60 min = 2100 min
Resource Needed = time taken / Time taken per resource
Total Resources saved (%) = (25-16)/25 *100 = 36.00%
(saved 36% operational cost)
Total resources saved (Number) = 25-16 = 7
Reduced flow time = (46000 – 33500)/46000
Optimized Flow Time: 33500 minutes =
*100 = 27%
558.33 hrs
Adjusted Flow Time: 558.33 *.63 = 351 hr
Flow Time (in week): 558.33/35 = 15.95
Improved Flow Time in Weeks: 351/35 = 10
weeks ~ 16 weeks
weeks
Flow Time (in days): 80 days
Improved Flow Time (in days) = 50 days
People Impact
Organisation Chart
Non paid CEO’s
CEO
Trustees Secretary

Customer Success
COO
Manager
Finance
Controller

Vendor Dispatch
PM Operations Receipt Clerks HR Manager
Manager Clerks

Customer
Application Completion
Coding Clerks support
assessors Manager

IT Supplier
Decline Payment
officers Officer
Learning &
Development

Admin
People Impact - Roles and Responsibilities
App Receipt Non-paid
CEO Support Staff
Assessor Clerks Trustees

•Data Entry and

•Review and assess
Coding: Reduced
applications.
number due to
• Focus on
• Oversee overall automation, focusing managing
•Communicate
strategy and directly with on managing the incoming
• Review
operations. intermediary charities automated system and applications and
unusual cases.
•Ensure alignment or applicants for handling exceptions. ensuring all
with charity’s additional required • Focus on
•Completing Officers
mission and values. information. documents are strategic
(Decline and Payment
•Engage with Officers): Streamline included. oversight rather
•Maintain up-to-date
stakeholders and status in the these roles into fewer than routine
• Manage the
manage public centralized database. positions with approvals
automated system
relations. enhanced tools to
•Ensure timely expedite letter writing for initial data
processing and and payment entry and coding
decision-making. processing.
Training Requirements
● Centralized Database System Training:
○ All staff members need comprehensive training on using the new IT system.
○ Focus on real-time updates, tracking, and status reporting.
● Case Management Skills:
○ Applications Assessors need training on case management principles, effective communication, and decision-making.
○ Emphasis on maintaining personal contact with intermediary charities and applicants to build trust and ensure clarity.
● Automation Tools:
○ Support staff must be trained on the automated data entry and coding systems.
○ Training on handling exceptions and troubleshooting the system.
● Enhanced Communication Skills:
○ All employees, especially those handling inquiries, need training in effective communication and customer service.
○ Focus on providing clear and timely updates to inquiries.
● Change Management:
○ Training sessions to manage the transition to the new process and address any resistance to change.
○ Emphasis on the benefits of the redesigned process for efficiency and mission fulfillment.
Thank you.

Q&A