Chase Manhattan Bank Case Study

Chase Manhattan Bank Case Study

Team 1

American Public University

August 23, 2015

Abstract

The goal of the Chase Manhattan Bank case study is to find the minimum possible personnel costs subject to meeting or exceeding the hourly workforce requirements, as well as, take into consideration all workforce requirements and constraints (Render, Stair & Hanna, 2012).  Linear programming (LP) was used to create a model to find the minimum personnel costs for the Chase Manhattan Bank.  This paper summarizes the factors, costs, and workforce requirements of the case study (Render, Stair & Hanna, 2012), and this paper details the assumption, decision variables, constraints, and objective determined from the information presented in the case study.  The results of the LP model were analyzed and presented to answer the primary goal of minimizing personnel costs for the Chase Manhattan Bank case study.  Limitations of this LP model are also explained.  In illustrating if increasing the part-time workforce limitation above a forty percent (40%) restriction could increase or decrease the personnel costs for the Chase Manhattan Bank, additional LP models were created and analyzed.  This paper shows a meaningful cost savings based on this change to the Chase Manhattan Bank’s policy regarding its part-time workforce and the corresponding analyses.  

Chase Manhattan Bank Case Study

Chase Manhattan Bank is facing the issue of dividing up their labor personnel hours to most efficiently cover the hours with minimum cost.  The options of labor include full-time employees, part-time employees, and full-time employees with overtime options.  The issue presented is to enable the bank to have enough employees working at one time while minimizing part-time employees to no more than forty percent (40%) of the total daily work requirement and limiting the overtime hours for full-time employees to no more than five hours per week.  To solve the case study pertaining to Chase Manhattan Bank, a linear programming (LP) model was used to analyze the objective, assumption, decision variables, and constraints.  The results of the linear program were used to answer the following three questions:  (1) “what is the minimum cost schedule for the bank?”, (2) “what are the limitations of the model used to answer question 1?” , and (3) “would changing the 40% to a higher value significantly reduce costs?” (Render, Stair, & Hanna, 2012, p. 339).

Case Study Factors, Costs, and Workforce Requirements

The Chase Manhattan Bank case study involves factors, costs, and workforce requirements (Render, Stair & Hanna, 2012) that affect the LP model used to solve the case study.  These factors, costs, and workforce requirements pertain to the full-time and part-time employees, and these factors, costs, and workforce requirements are the basis for determining the objective, decision variables, and constraints needed to create and solve the LP corresponding to this case study.  The workforce requirements are shown in table 1.  The factors and costs are: