TDABC; Continuation of Problem 5-64 Suppose that in addition to the call center engagement outlined
TDABC; Continuation of Problem 5-64
Suppose that in addition to the call center engagement outlined above, AS also provides the following annual service to 10 other clients:
Total Calls Answered
Average Number of Minutes/Call
Platinum Regional Bank
234,000
6.0
Healthwise Software Inc
66,788
5.0
Johnson Manufacturing
122,665
4.0
Lesco Online Shopping
233,756
6.0
Babcock Insurance Service
55,455
5.5
Garcia Electric Supply and Service
38,956
3.4
Gilbert’s Online Garden Supplies
145,902
4.0
Financial Planning Services Inc
68,993
11.0
Porter’s Camera and Optical
198,440
6.0
Required
What is the unused capacity at MSI, not assuming that AS becomes a customer? What are the implica- tions for the operating and marketing strategies at AS?
Assume that AS comes back to MSI with a revised proposal. The revised proposal includes call center activity as described in problem 5-64, but in addition, AS wants MSI to provide error-checking services for those who apply for loans at AS. MSI would use some of the call center staff, after appropriate train- ing, to complete the processing of the credit checks. AS expects the following service to be needed:
Processing Credit Checks
Auto Requests
45,600 Min./request
10
Truck
12,500
18
What would be the unused capacity with the revised proposal? What would be the cost of the unused capacity?