This document discusses applying queuing theory to analyze wait times at a bank ATM. Customer arrival and service rates were observed to be 1 customer per minute and 2 minutes per customer respectively. This yields an utilization rate of 0.7 and average queue length of 3 customers. Queuing theory formulas were used to calculate theoretical wait times which closely matched observed times. The analysis can help the bank optimize the number of ATMs to improve customer service.
This document discusses applying queuing theory to analyze wait times at a bank ATM. Customer arrival and service rates were observed to be 1 customer per minute and 2 minutes per customer respectively. This yields an utilization rate of 0.7 and average queue length of 3 customers. Queuing theory formulas were used to calculate theoretical wait times which closely matched observed times. The analysis can help the bank optimize the number of ATMs to improve customer service.
This document discusses applying queuing theory to analyze wait times at a bank ATM. Customer arrival and service rates were observed to be 1 customer per minute and 2 minutes per customer respectively. This yields an utilization rate of 0.7 and average queue length of 3 customers. Queuing theory formulas were used to calculate theoretical wait times which closely matched observed times. The analysis can help the bank optimize the number of ATMs to improve customer service.
This document discusses applying queuing theory to analyze wait times at a bank ATM. Customer arrival and service rates were observed to be 1 customer per minute and 2 minutes per customer respectively. This yields an utilization rate of 0.7 and average queue length of 3 customers. Queuing theory formulas were used to calculate theoretical wait times which closely matched observed times. The analysis can help the bank optimize the number of ATMs to improve customer service.
Download as PPTX, PDF, TXT or read online from Scribd
Download as pptx, pdf, or txt
You are on page 1/ 21
MODY UNIVERSITY
(COBMEC) QUANTITATIVE TECHNIQUES OF MANAGERIAL APPLICATIONS
CASE STUDY FOR BANK ATM QUEUING MODEL
SUBMITTED TO : SUBMITTED BY : PRIYAL SARRAF DR. PRIYANKA JAIN PURVI SHARMA MANISHA JOSHI JALPA MADEKA AISHA KUKHRANIA AARTI PAWAR WHAT IS QUEUE? Queue is a word that means a waiting line or the act of joining a line Queuing is the common activity of customers or people to avail the desired service, which could be processed or distributed one at a time Queuing theory was proposed by A.K. Erlang It optimizes the number of service facilities and adjusts the times of services QUEUING THEORY The beginning of the study of queuing theory was in the year 1908 when Copenhagen Telephone Company requested Agner K. Erlang to work on the holding times in a telephone switch. He identified that the number of telephone conversations and telephone holding time fit into Poisson distribution and exponentially distributed. There are two common concepts of queuing theory used in this case study to solve Bank ATM problems:
Littles Theorem M/M/1 Queuing Model or ATM Model INTRODUCTION This case study is about BRAC BANK ATM, at Chittagong city, Bangladesh Bank provides one ATM in every branch, but one ATM would not serve a purpose of all customers and they shift to other bank ATM So Bank ATM would try to avoid losing their customers due to long wait on the line by improving their service time In ATM, bank customers arrive randomly and the service time is also random The capacity of the queue is can be limited or unlimited. Bank is an example of unlimited queue length QUEUING SYSTEM A queuing system can be described by : 1. The input or arrival pattern 2. The service mechanisms 3. The queue discipline 4. Customers behavior QUEUING SYSTEM (CONTD) A queuing system consists of one or more servers that provide service to arriving customers
Arrivals Service Exit Station Queues Queuing Model Q
Where, is arrival rate the average rate at which customer arrives S is service time the average time required to service one customer W is the average number of customer waiting Q is the total number of customer in the system LITTLES THEOREM It describes the relationship between arrival and service rate or number of customers and jobs in the system The theorem states that expected number of customers (N) for a system in steady state is determined by the equation N = T Where is the arrival rate and T is the service time for a customer It describes three fundamental relationships N increases if or T increases increases if N increases or T decreases T increases if N increases or decreases M/M/1 MODEL (ATM MODEL) OBSERVATION & DISCUSSION
Researcher has collected the one month daily
customer data by observation during banking time, as shown in Table. Table : Monthly Customer Counts
Figure: One month total customer counts CALCULATIONS It is observed that, after Saturday, during first two days of a week, there are on average 60 people coming to the ATM in an hour time period of banking time. From this we can derive the arrival rate as:
= 60/60 = 1customers/minute (cpm )
It is also observed (with ATM guard) that each customer spends 2 minutes on average in the ATM (W), the queue length is around 3 people (Lq) on average and the average waiting time is around 2.5 minutes i.e. 150 seconds. Theoretically, the average waiting time is, Wq = Lq / = 3customers = 3minutes = 180 seconds 1cpm Here, we can see that, the observed actual waiting time does not differ by much when it is compared with the theoretical waiting time. Next, we will calculate the average number of people in the ATM, L = 1 cpm x 2minutes = 2 customers Having calculated the average number of customers in the ATM, we can also derive the service rate and the utilization rate , = (1+L) = 1(1+2) = 1.5cpm L 2 Hence, P = = 1cpm = 0.70 1.5cpm With the very high utilization rate of 0.70 during banking time, the probability of zero customers in the ATM is very small, Po = 1 - p =1 - 0.70 = 0.30 The queuing theory provides the formula to calculate the probability of having n customers in the ATM as follows: p n = (1- p) p n = (1 0.70) (0.70) n = (0.30) (0.70) n EVALUATION The utilization is directly proportional with the mean number of customers The utilization rate is very high during banking time on weekends and it is half of it on week days The customers waiting time will decrease if the number of customers that are able to be served per minute increases When the service rate is higher the utilization will be lower, which makes the probability of the customers going away decreases BENEFITS This research helps the bank ATM to increase its QOS (Quality of service), if there are many customers in the queue This research may help to analyze the current system and improve the next system By estimating the number of customers coming and going in a day, the Bank can set a target that, how many ATMs are required to serve people in the main branch or any other branch of the Bank CONCLUSION This research has discussed the application of queuing theory to the bank ATM From the result we obtained that, the rate at which customers arrive in the system is 1 cpm and the service rate is 1.5 cpm The probability of buffer overflow is the probability that customers will run away, because may be they are impatient to wait in the queue This theory is applicable to the Bank, if they want to calculate all the data daily and can be applied to all branch ATM The problem that were faced in completion of this research were the inaccuracy of result because some data used was just based on assumptions This research can contribute in the better functioning of Bank ATM
