T6. Capacity Decisions

Question 1

What is capacity?

Answer 1

Is the max rate of output of a process or a system

Question 2

How can capacity be measured?

Answer 2

1. Output measure: for firms with high volume of few standarized products ( number or toys, tons of candy)
2. Input measure: for firms with high product/ process diversity, where productivity rates are expected to change. ( number of hours, number of workers)

Question 3

What are the steps in making capacity decisions?

Answer 3

1. Estimate capacity requirements
2. Compare capacity requirements with available capacity to find gap
3. Develop a plan to reduce the gap
4. Evaluate alternatives and make a choice

Question 4

How do you estimate the capacity requirements?

Answer 4

1. The firm has a forecast of the possible sales ( output measure)
2. The firm calculates the demand in terms of input needed
   M = Dp / N [1 - ( c /100) ]
   M- capacity requirement related to resource M
   D- demand
   P- processing time
   N- number of hours the process is ON
   C- capacity cushion

Question 5

How do you find the gaps between capacity requirement and available capacity?

Answer 5

Use
1. Saturation capacity = hours required / hours available
Saturation < 100 demand can be met
Saturation > 100 demand cant be met

2. Capacity gaps=
   Hours required - hours available
   Gap > 0 capacity gap needs to be filled
   Gap < 0 the isnt a capacity gap

Question 6

What plans can you develop to reduce the gap?

Answer 6

Long term plans: add facilities, add long lead equipment,

Medium term plans: subcontract, add equipment, add shifts, add personnel, build or use inventory

Shor term plans: schedule jobs, schedule personnel, allocate machinery

Question 7

What is a constraint?

Answer 7

A factor that limits the performance of a process and restricts its output ( creating a bottleneck in the process)
The bottleneck limits the company’s ability to meet its demand and production capacity

Question 8

What are the steps followed in the theories of constraints to control bottlenecks?

Answer 8

1. Identify the bottleneck
2. Exploit the bottleneck or constraint
3. Subordinate all other decisions to step 2
4. Elevate bottleneck
5. Do not let inertia set in

Question 9

True or false?

Increasing the capacity of a non-bottleneck activity will increase the capacity of the whole process

Answer 9

False!

Question 10

True or false?

Less lost time at the bottleneck is less lost time for the whole system

Answer 10

True!

Question 11

How to calculate:
Bottleneck
Capacity per hour
Throughput time
Cycle time for entire process
Cycle time of one station

Answer 11

Bottleneck: activity with longest time

Capacity per hour:
1h or 60 min or 3600 sec/ bottleneck time.

Throughput time: sum of each activity time

Cycle time: total activities time/ total workers

C.t of one station: activity time/ workers in the station

Question 12

When can I expect to have waiting lines?

Answer 12

When the customer arrival rate > processing rate.

Cuando el paso siguiente tiene un mayor processing time

Question 13

What are the two basic system designs for waiting lines?

Answer 13

1. Single server: can be single phased ( el odontologo) or multiphased (Mc Donalds drive thru)
2. Multiserver: can be single phased ( el banco)
   Multiphased

Question 14

What are some priority rules in waiting lines?

Answer 14

FCFS first come first served
EDD earliest due date
SPT shortest processing time
Preemptive discipline ( veterans, old, pregnant)

Question 15

What measures can be taken from the arriving customer population?

Answer 15

1. λ average arrival rate
2. 1/ λ average time between arrivals
3. Pn probability of n arrivals within T time

Question 16

What measures can be taken from the departing ( serviced ) customer population?

Answer 16

1. μ average units processed per period
2. 1/μ average service time
3. P(t) probability of the service time

Question 17

What are the characteristicas supossed for the single served single phase model and for the multiple server single phase model?

Answer 17

Single server single phase

1. infinite population
2. Customer arrival rate has poisson distribution
3. Service processing rate has exponential distribution
4. The priority rule is FCFS
5. The lenght of the waiting line is unlimited.
6. μ > λ

 Multiple server single phase
( todas las anteriores ademas de:)
7. All the servers are identical
8. s•μ > λ
9. The service distribution for each server is exponential