Answer the following questions each for Alternative 1 and Al

Answer the following questions each for Alternative 1 and Alternative 2

Cpacity/hr

Productivity/manhour

Productivity/peso

%Utilization

Alternative1: Dobule the workers assigned to each operation

Alternative 2: Double the workers assigned to the bottleneck section

Please answer with complete solution adn detailed explanation. Thanks!

Solution

Productivity/manhour:

Alternative 1: Double the workers assigned to each operation.

Operation 1: Average Time, T₁ = 5 min. = 1/12 hrs.

Operation 2: Average Time, T₂ = 10 min. = 1/6 hrs.

Operation 3: Average Time, T₃ = 8 min. = 2/15 hrs.

Operation 4: Average Time, T₄ = 2 min. = 1/30 hrs.

Operation 5: Average Time, T₅ = 5 min. = 1/12 hrs.

Operation 6: Average Time, T₆ = 5 min. = 1/12 hrs.

Old System:- Hourly demand = 10 applications per hour.

Productivity/manhour for the Old System = Units produced / Manhours used =

10 / [(2 x 1/12) + (4 x 1/6) + (2 x 2/15) + (2 x 1/30) + (2 x 1/12) + (2 x 1/12)] = 10 / 1.5

= 6.67 applications/manhour.

New System:- Hourly demand = 12 applications per hour.

Productivity/manhour for the New System = Units produced / Manhours used =

12 / [(2 x 1/12) + (4 x 1/6) + (2 x 2/15) + (2 x 1/30) + (2 x 1/12) + (2 x 1/12)] = 12 / 1.5

= 8 applications/manhour.

Alternative 2: Double the workers assigned to the bottleneck section.

Here, the bottleneck section is Operation 2, that of “Inspect vehicle”, since it takes the longest time, i.e., 10 minutes.

Number of workers required for Operation 2 = 4.

Number of workers required for other Operations remains same.

Old System:- Hourly demand = 10 applications per hour.

Productivity/manhour for the Old System = Units produced / Manhours used =

10 / [(1 x 1/12) + (4 x 1/6) + (1 x 2/15) + (1 x 1/30) + (1 x 1/12) + (1 x 1/12)] = 10 / 1.083 =

9.23 applications/manhour.

New System:- Hourly demand = 12 applications per hour.

Productivity/manhour for the New System = Units produced / Manhours used =

12 / [(1 x 1/12) + (4 x 1/6) + (1 x 2/15) + (1 x 1/30) + (1 x 1/12) + (1 x 1/12)] = 12 / 1.083

= 11.08 applications/manhour.

Productivity/peso:

Alternative 1: Double the workers assigned to each operation.

Let us assume that all the 6 Operations, viz., 1, 2, 3, 4, 5 and 6 require an overtime of 1 hour each, although Operation 5 will not have any overtime payment as Operation 5 is carried out by the manager Mr. Dilay.

Hourly Rate for Operation 1

= [50 x 2 (worker is doubled in each operation) + 50 (for 1 hour overtime)] / 2 = 75 pesos.

Hourly Rate for Operation 2 = [(55 x 2 + 55)] / 2 = 82.5 pesos.

Hourly Rate for Operation 3 = [(55 x 2 + 55)] / 2 = 82.5 pesos.

Hourly Rate for Operation 4 = [(50 x 2 + 50)] / 2 = 75 pesos.

Hourly Rate for Operation 5 = 70 x 2 = 140 pesos.

Hourly Rate for Operation 6 = [(55 x 2 + 55)] / 2 = 82.5 pesos.

Old System:- Hourly demand = 10 applications per hour.

Productivity/peso for the Old System = Units produced / Hourly Rate in pesos =

10 / (75 + 82.5 + 82.5 + 75 + 140 + 82.5) = 10 / 537.5 = 0.019 applications / peso.

New System:- Hourly demand = 12 applications per hour.

Productivity/peso for the New System = Units produced / Hourly Rate in pesos =

12 / (75 + 82.5 + 82.5 + 75 + 140 + 82.5) = 12 / 537.5 = 0.022 applications / peso.

Alternative 2: Double the workers assigned to the bottleneck section.

Here, the bottleneck section is Operation 2, that of “Inspect vehicle”, since it takes the longest time, i.e., 10 minutes.

Number of workers required for Operation 2 = 4.

Number of workers required for other Operations remains same.

Hourly Rate for Operation 2 = [(55 x 2 + 55)] / 2 = 82.5 pesos.

Hourly Rates for other Operations remain same as given in the Case.

Old System:- Hourly demand = 10 applications per hour.

Productivity/peso for the Old System = Units produced / Hourly Rate in pesos =

10 / (50 + 82.5 +55 + 50 + 70 + 55) = 10 / 362.5 = 0.028 applications / peso.

New System:- Hourly demand = 12 applications per hour.

Productivity/peso for the New System = Units produced / Hourly Rate in pesos =

12 / (50 + 82.5 +55 + 50 + 70 + 55) = 12 / 362.5 = 0.033 applications / peso.