Capacity planning

Chapter 4: Capacity planning

Conceptual:

Long-term capacity planning

Measures of capacity (when to use outputs or inputs as a capacity measure)

and utilization

Operating at full capacity

Diseconomies of scale

Capacity utilization rate

Capacity cushions

Capacity timing and sizing strategies (wait-and-see, expansionist)

Measures of Utilization and Capacity

Estimation of Capacity Requirements

 

Numerical:

HW5: Estimating capacity requirements

A set of problems at the end of Chapter 4 slides

 

Chapter 5: Constraint Management

 

Conceptual:

What is a constraint?

What is a bottleneck?

The theory of constraints

 

Numerical:

• identifying bottlenecks in the system;
• What is the max capacity?
• Bottleneck?
• Throughput?
• Max flow rate?
• What is the flow rate if demand is 5 units per hour?
• What is the flow rate if demand is 10 units per hour?
• Finding the best product mix using traditional vs. bottleneck approaches

 

HW6

 

Supplement B: Waiting lines

Conceptual:

structure of the waiting line, waiting line arrangements, service facility arrangements, waiting lines performance measures

Waiting line models

Waiting line arrangements

 

Numerical:

HW 7: single-server model problems: probability of arrivals, probability of service time, and other additional applications such as average number of customers, average time spent in the system/waiting line, average utilization, etc.

 

Supplement D: Linear Programming

Numerical: Evaluate profit-optimizing production given limited resources

 

Understand and identify objective function, decision variables, constraints, feasible regions and parameters.

 

HW 7

Sample problems:

 

A.J.’s Wildlife Emporium manufactures two unique birdfeeders​ (Deluxe and Super​ Duper) that are manufactured and assembled in up to three different workstations​ (X, Y, and​ Z) using a small batch process. Each of the products is produced according to the flowchart below.​ Additionally, the flowchart indicates each​ product’s price, weekly​ demand, and processing times per unit. Batch setup times are negligible. A.J. can make and sell up to the limit of its weekly demand and there are no penalties for not being able to meet all of the demand. Each workstation is staffed by a worker who is dedicated to work on that workstation alone and is paid ​$18 per hour. The plant operates 40 hours per​ week, with no overtime. Overhead costs are ​$2,200 per week. Based on the information​ provided, as well as the information contained in the​ flowchart, answer the following questions.

 

 

Using the​ bottleneck-based method, what is the optimal product mix and what is the overall ​profitability?

 

1. ​Deluxe: 63 ​units/week, Super​ Duper: 60 ​units/week.
2. Deluxe: 63 ​units/week, Super​ Duper: 54 ​units/week.
3. Deluxe: 43 ​units/week, Super​ Duper: 60 ​units/week.
4. Deluxe: 68 ​units/week, Super​ Duper: 60 ​units/week.

 

Related to the previous problem. This product mix yields a profit of

 

1. $2,702
2. $2,500
3. $2,670
4. $2,800

 

 

Practical application of the Theory of Constraints involves the implementation of all of the following steps EXCEPT:

 

1. Identify the system bottleneck(s).
2. Exploit the bottleneck(s).
3. Reduce the capacity at the bottleneck(s).
4. Elevate the bottleneck(s).

 

 

 

 

• A car wash offers two car wash packages, Ultimate Wash and Premier Wash. Arriving customers are routed in different directions based on the preferred service. Each step of the process has a processing time (in parenthesis):

How many customers can be processed through the ultimate wash (ABCDH) during a 4-hour evening session?

1. 48
2. 24
3. 32
4. 12

 

The Shader Electronics Company produces two products: (1) the Shader Walkman, a portable CD/DVD player, and (2) the Shader Watch-TV, a wristwatch-size internet-connected color television. The production process for each product is similar in that both require a certain number of hours of electronic work and a certain number of labor-hours in the assembly department. Each Walkman takes 4 hours of electronic work and 2 hours in the assembly shop. Each Watch-TV requires 3 hours in electronics and 1 hour in assembly. During the current production period, 240 hours of electronic time are available, and 100 hours of assembly department time are available. Each Walkman sold yields a profit of $7; each Watch-TV produced may be sold for a $5 profit.

The best possible combination of Walkmans and Watch-TVs to manufacture is, respectively:

1. 30 Walkmans and 40 Watch-TVs
2. 40 Walkmans and 30 Watch-TVs
3. 30 Watch-TVs and 30 Walkmans
4. 40 Watch-TVs and 40 Walkmans

 

 

The degree to which equipment, space, or labor is being used is commonly referred to as:

1. Utilization
2. Cushion
3. Output
4. Capacity

 

 

Your customers arrive to your coffee shop according to a Poisson distribution. The average number of customer arrivals per hour is 6. The probability that 4 customers will arrive in the next 3 hours is:

 

1. less than or equal to 0.01.
2. greater than 0.01 but less than or equal to 0.02.
3. greater than 0.02 but less than or equal to 0.03.
4. greater than 0.03.

 

The management of the large department store in Example B.1 must determine whether more training is needed for the customer service clerk. The clerk at the customer service desk can serve an average of four customers per hour.

• What is the probability that a customer will require less than 10 minutes of service?
• What is the probability that a customer will require more than 10 minutes of service?