IE 266 - Engineering Statistics II - Spring 2014
Case Study I
Due Date: May 05, 2014
Cash Management in Tacobank
Tacobank, which is one of the leading banks in Turkey, is very concerned about reducing its
costs nowadays. The annual reports have indicated that the operational costs associated
with cash management are over the annual goals.
The cash management system of Tacobank has two components: cash management of
branches and cash management of ATMs. One of the chief executives, Ms. Doğan, knows
that it is almost impossible to reduce the cash management costs of branches due to current
regulations. However, she thinks that there is room for improvement for the ATM cash
management system. Thus, she instructs Ms. Türeci, who is the manager of ATM Cash
Management Department, to start a new project aiming to design a better cash
management system for ATMs. Ms. Türeci is very enthusiastic about this project and would
like to start with a preliminary analysis of the replenishment strategy of the ATMs. She
thinks that replenishment costs can be reduced significantly if groups of ATMs can be
replenished simultaneously. ATMs can be replenished simultaneously if they are close to
each other and their withdrawal amounts are similar.
Ms. Türeci is aware that this is a large scale problem due to the wide ATM network and plans
to start with two ATMs in a nearby shopping mall and asks for your help for the analysis. The
daily customer withdrawal data for February 2014 for both ATMs is given in “Mall” sheet of
“withdrawal.xlsx” file.
a) Based on this data, prepare a report for Ms. Türeci that gives information about the
withdrawals from both ATMs. Is it reasonable to jointly replenish these ATMs? Do not
forget to explicitly state your underlying assumptions and justify them.
After the analysis is finalized for all ATMs in Çankaya, Mr. Çelik who is in charge of cash
management vehicles in this area has decided that the ATMs in the mall and in METU
Campus can be replenished together. From his past experiences, he comes up with the daily
operational cost function for this tour as Y= 100+0.001X1+0.002X2 where X1 is the total daily
customer withdrawal amount in the mall and X2 is the total daily customer withdrawal
amount in METU Campus. You can find X2 values in “METU Campus” sheet of
“withdrawals.xlsx”.
b) Prepare a report that gives information on the daily operational cost of this tour under
the assumption in part b.