Chapter 8 Resource Utilization

Question 1

Name the ways operators utilizes capacity and distinguish three actions for improving resource utilization.

Answer 1

Active capacity, idle time and excess capacity.

Resource utilization actions - CAP - Cut, Activate, Postpone.

1. Excess capacity can happen because of an improper estimate of the workload or an inflexible workforce. Excess capacity can be cut through better resource planning.
2. Idle time can happen because of bottlenecks or operators who are only authorized to work on a few activities. Operators should be activated to resolve bottlenecks and using them in a multifunctional manner.
3. The active capacity cannot be reduced because it is assumed operators are performing activities in an efficient way as established in the effective stage. However, activities might be performed to early compromising the timely completion of other tasks or increasing capacity. It might be better to postpone activities to resolve these negative effects.

Question 2

What are the two options to reduce (cut) excess capacity.

Answer 2

1. Flexible capacity deployment - Options to reduce the number of operators is to have a flexible workforce. If there are heavy fluctuations in the workload, then a small, dedicated workforce complemented with a large flexible crew is preferred. If fluctuations are limited, a large, dedicated workforce is better.
2. Workload balancing - The DC should distinguish between orders that must be shipped and those that can be shipped. Must-ships should be completed during the day while can-be-shipped should be completed when there is sufficient capacity. The efficiency of the operators will determine how many of the optional tasks will be completed.

Question 3

What is idle time?

Answer 3

It is when operators do not perform tasks even when there is work to be done.

Question 4

What are the causes of idle time?

Answer 4

1. Absenteeism - Operators who are sick are inactive. Policies fighting absenteeism should promote safety, ergonomics, improves morale and actively monitors sick operators.
2. Starting and ending - Lunch breaks and tea breaks cause interruptions to workflow. Operators might linger adding to idle time. At the end of the shift operators are reluctant to start a new order task.
3. Organizational silos - Operators only assigned to one job can create organizational silos increasing idle time. They should be trained to perform various activities. Multifunctional deployment of employees is important to reduce the idle time which leads to employees performing non-urgent activities once they become idle.
4. Workload fluctuations - idle time can happen because of workflow fluctuations. If order picking is concentrated in a short time period during the afternoon the WMS can release advance replenishment for all products below threshold in the morning.
5. Bottlenecks - Task management can reduce idle time and should make a trade-off between efficiency and urgency. Control rules such as the hierarchical control rule is a good example of how idle time can be reduced through task management.

Question 5

What does the postponement of activities prevent?

Answer 5

1. Poor space utilization - when goods have to wait a considerable time at the staging location.
2. Late completion of urgent activities - when operators complete less urgent activities first.
3. Increased capacity requirements - when operators complete activities that could wait till later.