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Lockbox Case Study

Lockbox Case Study. Introduction. Mark has a problem. His boss at United Bank of the Americas (UBOTA) has made a Board-level commitment to have the issues in their lockbox business addressed by year-end. He assigned the project to Mark.

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Lockbox Case Study

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  1. Lockbox Case Study

  2. Introduction • Mark has a problem. His boss at United Bank of the Americas (UBOTA) has made a Board-level commitment to have the issues in their lockbox business addressed by year-end. He assigned the project to Mark. • It’s now the first of September and Mark doesn’t have a plan.

  3. Problems • The problems that need to be addressed are as follows: • UBOTA is confident their direct cost numbers for lockbox are accurate, but they don’t know for sure their internal cost allocations are solid. Accordingly, some people don’t put much trust in the total cost numbers. Without reliable costs, they are not sure the prices they set provide an acceptable profit. For some large deals where they price very aggressively, they’re not sure they make any money at all. With the numbers we have, can we give them any guidance or comfort? • They have lost customers recently to a cross-town competitor who offers attractive lockbox features UBOTA does not have. Many customers that have left the bank are seasonal businesses with lockbox activity only 6-8 months of the year. The competitor does not charge them for months when their accounts have no activity. Some other departing clients are rapidly expanding businesses that were adding new lockboxes at the rate of 1 or 2 each month. What should they do? • Recent customer surveys have shown declines in lockbox customer satisfaction. A few large and very vocal customers have raised their issues quite high in the bank. Most issues seem to deal with new accounts – it’s taking a long time to get them set up. New Account Set Up department denies they are the issue. They say they are meeting 2/3 of their performance metrics at a 100% level. • What should they do?

  4. Assignment • Mark has hired TSI to help him. Your assignment is to develop recommendations for addressing these lockbox business issues. • The attached data is what we have to work with. It may not be complete, but we cannot get anything else. Since Mark’s back is against the wall, we have to help him using the available data. • Suggested approach: • Provide a succinct statement of the problem. • What are the facts as you see them? • What conclusions do you draw from these facts? • What recommendations suggest themselves from these conclusions? • Include at least one well-titled, relevant graph/chart.

  5. Data

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