HW #2

The local post office receives an average of 60 customers per hour who seek various services like
purchase of stamps and stationery, savings bank (SB) and “accountable” services like registration,
speed post, money orders and telegrams. Of the 60, an average of 10 come for SB transactions and 25
for accountable services. The remaining 25 come exclusively for stamps and stationery.
Around 15 customers, who came for accountable services, usually stood in line thrice: once to find out
what they need to do and the value of the stamps needed; then to buy the stamps and finally to do the
accountable transaction. About half of the customers coming to the post office for accountable
transactions and SB invariably had requirements of stamp and stationery.
The post office currently has one SB counter, two counters for accountable transactions, and one
counter for stamps and stationery. The average service time in the SB counter, accountable service
counters, and the stamp and stationery counter was three minutes, two and a half minutes and one
minute respectively. 1
The postmaster usually observed the stamps and stationery line to be the longest. However, he got
maximum complaints from the people who came for accountable transactions. While he was wondering
what he could do to improve customer service, especially in terms of reducing waiting times, he
received a letter from the superintendent of post offices. The letter indicated that this post office branch
had been selected as one of the post offices for computerization.
Computerization was expected to enable the counters engaged in accountable transactions to reduce the
average service times from two and a half minutes to one and a half minutes. It would also eliminate the
need for customers to buy stamps for the accountable transactions.
The letter also indicated the possibility of improved software being used, which would also enable SB
transactions, in addition to accountable transactions, to be processed. However, since the counter clerks
would have to adapt to a wider range of activities, the average service time would now be two minutes.
The counters, however, would be truly multipurpose.
The postmaster thought that this was indeed a boon since there was potential to improve the
performance of both the SB and accountable service counters significantly. However, he soon realized
the catch in the proposal: the post office would have to reorganize itself to release one counter clerk for
redeployment elsewhere. He felt dejected and wondered whether there would be any improvement at
all.
1) How should the postmaster measure the performance of the post office?
2) Evaluate the performance of the current system at the post office.
3) Why were there more complaints about accounting transactions? What does this imply about
customer behavior?
4) How will computerization of the post office, and consequent reduction in service time, affect
operations at the post office?
5) Should the post office computerize SB transactions?
6) How can the post office meet the goal of downsizing staff by one person? What are the implications
of this decision?
7) How would you improve customer satisfaction and the performance of the post office? Discuss
both operational and behavioral aspects.

1
Assume exponential arrival and service times in all cases.