Top 20 US Bank Achieves $1.6M Annual Savings and 6 Sigma Quality through Lockbox Transformation with Coforge
Overview.
A top 20 US-based bank was facing inefficiencies in its lockbox operations that impacted pricing, service consistency, and accuracy. It needed a strategic partner to streamline operations, improve accuracy, and enhance cost efficiency through Six Sigma principles—and approached Coforge for the transformation.
The bank’s lockbox operations were hindered by an outdated and rigid pricing model that failed to meet market expectations. This lack of competitive agility made it challenging to attract new clients and retain existing ones, ultimately affecting growth and revenue potential.
Frequent service disruptions, marked by inconsistent quality and missed turnaround commitments, compounded the issue. These operational lapses led to customer dissatisfaction and trust erosion. Additionally, a high rate of processing errors triggered penalty payments to clients, further straining the bank’s profitability and operational efficiency.
Solution.
Coforge implemented a robust, multi-layered solution to re-engineer the bank’s lockbox operations:
Centralized Workflow Management: Introduced standardized processing queues to streamline workflows and reduce manual errors.
Rapid Transition & Training: Enabled swift knowledge transfer using a blend of instructor-led and interactive training sessions, allowing the team to manage most lockbox volumes within 120 days.
Remote Migration & Automation: Executed a remote migration of 29 FTEs, embedding automated business rules for each lockbox client, ensuring a two-hour guaranteed turnaround time.
Scalable Operations: Supported over 400 retail and 3,600+ wholesale lockbox clients with a 150+ FTE team across two locations, processing over 6.8 million items monthly.
The Impact.
$1.6M Annualized Cost Savings achieved through strategic outsourcing
Onsite Headcount Optimization: Reduced from 68 FTEs in 2020 to 28 FTEs by 2023
Quality Transformation:
Retail Lockbox: Improved from 4.7 to 6 Sigma (99.9989%)
Wholesale Lockbox: Improved from 4.0 to 6 Sigma (99.9998%)
Overall Lockbox: Reduced Defects Per Million (DPM) from 16 in 2006 to 3.4 currently
Coforge’s Lean Six Sigma-driven transformation delivered cost takeout, world-class accuracy, responsiveness, and scalability, positioning the bank as a high-performing player in lockbox processing.
