SE/IST Research Articles

Introduction

The Theory of Constraints (TOC) remains a powerful framework for improving process flows and operational efficiency. Developed by Eliyahu M. Goldratt and popularized in his seminal book The Goal, TOC focuses on identifying and managing bottlenecks: the most limiting factor in any system. Goldratt states:

"The throughput of any system is determined by its most significant constraint (bottleneck)."

Eliyahu M. Goldratt

Thus, to improve throughput, one must identify, manage, and eventually eliminate these constraints.

TOC is especially valuable in service operations such as banking, where customer wait times and process delays can significantly impact satisfaction and efficiency. Goldratt outlines a five-step process for applying TOC:

1. Identify the system's constraint(s)
2. Decide how to exploit the constraint(s)
3. Subordinate everything else to the above decision
4. Elevate the constraint(s)
5. If a constraint is broken, return to Step 1 (continuous improvement)

Problem statement

Long queues at ATMs in Nigeria remain a persistent issue, often requiring customers to wait more than 30 minutes for a simple transaction, a sharp contrast to average withdrawal times in the U.S. (47 to 60 seconds). During a recent visit, I observed various inefficiencies at play, many of which are avoidable.

These queues waste valuable time, affect customer satisfaction, and reduce the overall effectiveness of banking services. By applying TOC principles, we can optimize the ATM experience and reduce unnecessary delays.

Goal

To decongest ATM queues and improve the efficiency of ATM transactions, ultimately enhancing customer satisfaction and reducing operational waste.

Constraints identified

The major constraints contributing to long ATM queues include:

These constraints slow down throughput and negatively affect other banking services, as resources are tied up managing ATM congestion.

TOC application

1. Exploit the constraints

Maximize efficiency within the current limitations:

• Customer re-orientation through educational campaigns via email, SMS, bank apps, and ATM screens
• Encourage customers to prepare transaction details before arriving
• Offer in-bank assistance to reduce time spent by inexperienced users

2. Subordinate to the constraint

Align all other processes to support the management of the bottleneck:

• Customer service staff should ensure that best ATM practices are followed
• Direct non-withdrawal transactions (e.g., transfers, bill payments) to alternate platforms
• Banks should encourage digital banking through incentives or guided onboarding

3. Elevate the constraint

Implement initiatives to eliminate or reduce the impact of constraints:

• Deploy dedicated e-service ATMs for tasks like transfers, airtime purchases, and PIN resets
• Introduce priority access lanes for elderly or disabled customers
• Optimize queue management using single-line systems for fair, efficient flow
• Configure machines to support bulk withdrawals (pre-set denominations) to reduce transaction time
• Train customers to avoid:
  • Counting cash at the machine
  • Checking balances after withdrawal
  • Inserting or removing cards multiple times per session

4. Repeat the process

Continue observing, evaluating, and improving ATM operations through feedback loops, data analysis, and pilot programs for new queue solutions.

Enterprise-level initiatives