Answer following questions
1. [10 points] Write a self–reflection on the lessons that you learned from the Resource management topic.
What did you learn? What lessons can you apply to your personal life? What lessons can be carried
over to your (current or future) career? (150–200 words)
2. [15 points] Consider a production line with five stations.
a. Which station is the bottleneck station? (Note: 10 minute means the processing time per unit)
b. What is the throughput rate of the system?
c. What is the total processing time?
3. [15 points] A plastic bottle manufacturer uses a plastic injection molding machine to make different
bottles for different beverages. Plastic injection molding machines are used to make these parts and
it is time consuming to clean and re–setup the machines between production runs. Each molding
machine and operator works one nine–hour shift with a one–hour lunch break and one–half hour for
operator breaks. There are three work orders for the machine.
Station A
1 worker
10 minutes
Station B
1 worker
10 units/hr
Station C
1 worker
8 units/hr
Station D
1 worker
12 minutes
Station E
2 workers
16 minutes
MGMT 3106: Management Science and Operations Management
Consolidated Work
Orders
Work Order Quantity Setup (Changeover)
Time per Work Order
(minutes)
Processing Time per
Panel (seconds)
Model XVT–5 Case 9,500 panels 90 2.05
Model UYT–3 Case 7,500 75 1.78
Model KLY–6 Case 10,800 150 4.31
a. What is the total workload (demand) in hours for this work order mix?
b. How many machines will it take to do this work in one, two or three days?
c. How might this process be improved?
Show all computations.
4. [20 points] Perform a capacity analysis of the process given below. The numbers in parenthesis (#) are
the time in minutes to complete one unit of work. Demand on the process averages 20 units per hour
and each unit must be worked on by all four stages. Administrative clerk(s) do Stage A work. The
assistant manager(s) do Stages C and D work and are cross–trained to do both jobs. The coding
specialist(s) do Stage B work.
a. How many administrative clerks should be hired to do Stage A work, assuming a target utilization of 85
percent?
b. What is the current labor utilization of the coders at Stage B if two coding specialists are currently on
duty?
c. If there are 2 administrative clerks, 3 coding specialists, and 3 assistant managers on duty, what is the
process (throughput) capacity in units per hour?
d. Where do any bottlenecks exist and what do you recommend to improve this process?
Stage A (5)
Stage C (4)
Stage B (6)
Stage D (4)
MGMT 3106: Management Science and Operations Management
5. [20 points] The Westerbeck Company manufactures several models of automatic washers and dryers.
The projected requirements over the next year for their washers follow.
Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Demand 1500 1200 850 600 450 470 350 400 500 800 1200 1800
The firm has a production capacity of 900 units per month and the initial inventory (inventory carried
over from last December) is 1000 units. At the end of December, inventory should be 1000 units.
(Net demand = Gross demand + Inventory required at the end–of–month – Inventory from previous
month).
Inventory–holding costs are $25 per unit per month, regular–time production costs are $400 per unit.
Overtime costs an additional 15 percent, and under time costs an additional 10 percent. Lost sales
cost is $25 per unit and rate change cost is $5 per unit.
a. If the production choses to follow a level strategy, what should be the production level?
(Note: It is not required to produce at the production capacity) Assume that the production
level needs to be a multiple of 10. Also, assume that in the level strategy, production level
cannot be changed and any demand that cannot be satisfied with existing inventory will be
considered as lost sales. What is the cost of level production strategy (exclude production
cost)?
b. If the production choses to follow a chase strategy, what is the production level for each
month? What is the cost of chase production strategy (exclude production cost)? Assume
that the normal production capacity is 900 and if the production rate exceeds the normal
rate, overtime should be paid. Also, each time the production rate changes, a rate change
cost is applied. (e.g., if the actual production level is 1000 units, the rate change cost for that
month = |normal – actual| x unit rate change cost = |900–1000|x5 = $500).
c. Compare the production cost of level and chase strategies. Which strategy is better? Why?
6. [20 points] firm makes a product (Item A) from five components (intermediate Items B, D, and E, and
purchased item C). The required number of sub–components to make a parent component is given in
the parentheses. For example, to make 1 unit of A, 1 unit of B, 1 unit of C, and 2 units of D are required.
To make 1 unit of B, 2 units of C are required, and so on. The gross requirement for product A is 250–
unit order in week 8. Inventory on–hand for the items are given in the table below. Calculate the net
requirement for the five components.
Item On–Hand Inventory
A 50
B 60
C 90
D 70
E 2
