Process Analysis and Capacity Management
BUAD311 â€“ Operations Management
1. Dello is a world-class PC company. Management believes that they understand their products and customers better than any outsourcing company; therefore Dello should provide customer service in-house. Ideally, Delloâ€™s customer service department wants to handle all the customer phone calls. During peak hours, however, Dello receives so many customer calls that they ask an outsourcing company, Telemate, to help handle incoming calls. Delloâ€™s switchboard system is programmed in the following way; A customer calls Dello at its 1-800 number. If there are 14 or less callers in the ...view middle of the document...
Note: some triangles may be intentionally omitted.
Raw materials go through machines A, B, and then C, to produce a final product. Capacity, or service rate, of each machine is as follows:
Machine A: 200 units per hour
Machine B: 180 units per hour
Machine C: 120 units per hour
(All these numbers are expressed in terms of units of final product.)
a) Identify the bottleneck process. Is it A, B, or C? Explain briefly.
Machine C, since itâ€™s the slowest process of all.
Kate sincerely believes that she must keep high utilization of machines. Every time she sees an operator idle, therefore, she orders the operator to go back to the machine and continue operating.
b) What is she doing wrong? What is the most likely result if she manages the factory this way?
She doesnâ€™t seem to understand that the bottleneck process defines throughput of the entire system. In other words, the production facility can process just as fast as the bottleneck. If she tells every operator to produce all the time, most likely result is that she will have unnecessarily large WIP built-up between machines.
4. Eastern Coffee follows the flow chart below to serve its customers. Note that some triangles may be omitted intentionally. It takes a worker two minutes to take order and receive payment, two minutes to prepare coffee, and three minutes to clean equipment.
Eastern Coffee has two workers: worker A takes order and prepares coffee, while worker B handles the cleaning.
a) On average, 10 customers per hour show up and order coffee. What is the utilization rate of worker A? And what is the utilization rate of worker B?
Capacity of worker A: 60/(2+2) = 15 customers/hour
Capacity of worker B: 60/3 = 20 customers/hour
Utilization of A: 10/15 = 0.666 or 66.6â€¦%
Utilization of B: 10/20 = 0.5 or 50%
b) How many customers can Eastern Coffee serve per hour?
From the above, Capacity of Eastern Coffee is 15 customers/hour
Western Coffee follows the same flow chart above, and each activity takes the same amount of time as Eastern. Western Coffee also has two workers: worker C only takes order and payment, while worker D handles the coffee preparation and cleaning.
c) How many customers can Western Coffee serve per hour?
Capacity of worker C: 60/2 = 30 customers/hour
Capacity of worker D: 60/(2+3) = 12 customers/hour
Capacity of Western Coffee is 12 customers/hour
d) The manager of Western Coffee notices that cleaning is not a critical activity in the sense that it can be delayed and be finished when there are fewer customers. Therefore, during the peak hour when many customers come in, workers can focus on serving customers and temporarily ignore the cleaning activity. Then how many customers can Western Coffee serve during the peak hour?
Capacity of worker D during the peak hour: 60/2 = 30 customers/hour
Capacity of Western Coffee is 30 customers/hour
5. At Spotted Cow Coffee Shop, one...