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Week 5 Notes

by: Emily Laurienti
Emily Laurienti

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These notes cover week 5 lecture, which was the psychology of waiting lines along with a review of The Goal and going over homework. If you have any questions, feel free to email me at elaurien@us...
Operations Management
Prof. Hamid Nazer-Zadeh
Class Notes
business, Management, operations
25 ?




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This 4 page Class Notes was uploaded by Emily Laurienti on Saturday September 24, 2016. The Class Notes belongs to BUAD 311 at University of Southern California taught by Prof. Hamid Nazer-Zadeh in Fall 2016. Since its upload, it has received 6 views. For similar materials see Operations Management in Business Administration at University of Southern California.

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Date Created: 09/24/16
9.20.16 The Psychology of Waiting Lines  Actual waiting time vs. perceived waiting time o Customers often believe they waited longer than they actually did (can be accurate for about 3 minutes, then start exaggerating the time) o Perceived waiting time has a greater effect on customer satisfaction than actual wait time  Law of Service—Satisfaction = Perception – Expectation o Unoccupied waits feels longer than occupied waits o Pre-process waits feels longer than in-process waits o Anxiety makes waits seem longer o Uncertain waits are longer than known, finite waits o Unexplained waits are longer than explained waits o Unfair waits are longer than equitable waits o The more valuable the service, the longer I will wait o Solo waiting feels longer than group waiting  How to increase satisfaction o Change perception of wait time  Put distractions in the line  Give free wifi o Change expectations  Over-estimate time so customer is happy with shorter wait The Goal Review  Dependent events—a process can only move as fast as its slowest operation  Statistical fluctuations—add up throughout the system, don’t average out  Less variability near the beginning of the line is better than less variability at the end of the line o Flow time and WIP decrease with less variability near the beginning o Balance the flows of products through the system 9.22.16 Homework Review (below is the homework as I structured it) 1. a) What are the capacities (in items per hour) and utilization rates of each workstation? Process Capacity Utilization Rate Molding A 60 minutes/5 = 12 items/hour 10 demand/ 12 capacity = 83% Molding B 60 *2 minutes / 10 = 12 items/hour 20 / 12 = 167% Assembly C 60 * 2 / 5 minutes = 24 items/hour 10 / 24 = 41% Assembly D 60 * 4 / 6 minutes = 40 items/hour 20 / 40 = 50% Packing 60 / 1.5 minutes = 40 items/hour 30 / 40 = 75% b) Which workstation is the bottleneck? What is the capacity of Trojan Gadgets in items per hour? Molding B is the bottleneck because the utilization rate is over 100% ???????????????????????????????? ???????? ???????????????????????????? = ???????????????????????????????? ???????? ???????????????????????????????????????? % ???????????????????????? ???????? ???????????????????????????????????? ???????????????????????????????? ???????? ???????????????????????? ???????????????????????????? = 20 = 18 ???????????????????????????????? ???????????? ℎ???????????? 30 c) What are the capacities (in items per hour) and utilization rates of the molding workstation when molding workers are cross trained? How long on average does it take to make a product? 66.67% of demand takes 10 minutes = .6667 * 10 = 6.66 minutes 33.33% of demand takes 5 minutes = 1.67 minutes On average, the products take 8.33 minutes 3 workers working for one hour = 180 minutes 180/8.33 = 21.6 items per hour Utilization = 30/21.6 = 139% d) After assembly workers are cross-trained, which workstation will be the bottleneck? What is the capacity of Trojan Gadgets in items per hour? After cross training, the molding station is still the bottleneck because utilization is still over 100% and utilization rates of all other stations remain lower than 100% ???????????????????????????????? = 21.6 ???????????????????? ???????????? ℎ???????????? (???????????????????????????????? ???????? ????ℎ???? ????????????????????????????????????????) 2. a) How many graduates does JDCLittle hire every year? ???????????? ???????? = ???????? 100 ???????? = 5 = 20 ℎ???????????????? ???????????? ???????????????? b) How many associates are promoted to manager every year? How many are dismissed every year? 60 ???????? = = 10 ???????????????????????????????????????? ???????????????????????????????? ???????? ???????????????????????????? ???????????? ???????????????? 6 If 10 are promoted per year and 20 are leaving the associate position per year (to keep WIP constant) then 10 associates are dismissed per year. c) How many managers are promoted to partner every year? How many are dismissed? 10 ???????? = 10 = 1 ???????????????????????????? ???????????????????????????? ???????? ???????????????????????????? ???????????????????? ???????????????? 10 managers are leaving to keep WIP constant. 1 is being promoted, 9 are being dismissed. 3. a) In this system, what is the service time in seconds? Service time = 10 minutes wait + 23 minutes ride time = 33 minutes * 60 seconds = 1980 seconds b) What is the utilization rate of servers? ???? = ???? ???? = 1980 ???????????????????????????? ???? = 60 = .6 ???????????????????????????? ???????????????????????????????????????????????? ???????????????? ???? = 3350 ????∗???? 100 1980 ???? = = 98% .6∗3350 c) How many seconds on average each passenger waits before they are assigned a taxi? ???? ???? (√???? ????+???? −???? ???????? + ???????? ???? ???????? = ∗ ∗ ???? ???? ???? ???? − ???? ???? 1980 .982 3351 −11+1 ???????? = 3350∗ 1−.98 ∗ 2 = 5.76 ???????????????????????????? d) Suppose the answer to the previous part is 60 seconds (this is not the answer but let’s assume it is for now). How much on average does it take for passengers from the time they request a ride on the app till they are dropped off? ???????????????????? ???????????????? = 60 ???????????????????????????? + 1980 ???????????????????????????? ???????????????????????????? ???????????????? = 2040 ???????????????????????????? e) Suppose the taxi-drivers are paid $1 per minutes for a ride. However, they are not paid for the time spent on picking up. If a driver works 8 hours a day, how much does he make a day? To solve, find utilization of taxi driver (considering driving to pick up as idle time). Therefore, they are working for 23 minutes out of every 33 minutes. 23 ???? = 33 If a taxi driver works 8 hours, he is working for 98% of that time (as per utilization rate of the system) = 480 * .98 = 470.4 minutes and is being paid for (23/33) of those minutes 23 ???????????? = 470.4 ∗ ( ) = $327.85 33 f) The drivers are complaining about the long pick up time. Arpita, the manager of Zureb’s data science group, suggest the following policy: Before assigning a passenger to a driver, wait for 15 seconds, even if there are available drivers. Then, assign the passenger to the closes available driver, or to the next driver that become available. She observes that this way, they can assign drivers to the passengers that are closer to them and reduce the average pick up time from 10 to 5 minutes. i. If Arpita’s policy is implemented, do the drivers earn more or less? Why? The drivers still only get paid for 23 minutes, so they will earn the same; they will just have more idle time. ii. How much on average does it take for passengers from the time they request a ride on the app till they are dropped off? Wait time before being matched to a taxi is now 15 seconds Service time is 5 minutes + 23 minutes = 28 minutes * 60 = 1680 seconds service time + 15 seconds wait time = 1695 seconds total. iii. Do you agree with Arpita’s suggestions? Why? Yes, this system both helps the drivers to cut on fuel cost and shortens the amount of time you’re waiting for a ride, so everybody wins.


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