Concept explainers
a)
To determine: The capacity of the restaurant on weekly and annual basis in hours.
Introduction:
Capacity planning is a process of planning the required production output based on the requirement or the demand that is predicted.
b)
To determine: The weekly capacity of customers if the restaurant serves 40 customers per hour.
Introduction:
Capacity planning is a process of planning the required production output based on the requirement or the demand that is predicted.
c)
To determine: The implicit assumption made in the calculation of Part (b).
Introduction:
Capacity planning is a process of planning the required production output based on the requirement or the demand that is predicted.
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OPERATIONS MANAGEMENT IN THE SUPPLY CHAIN: DECISIONS & CASES (Mcgraw-hill Series Operations and Decision Sciences)
- Determine the utilization and the efficiency for each of these situations:a. A loan processing operation that processes an average of 7 loans per day. The operation has a design capacity of 10 loans per day and an effective capacity of 8 loans per day.b. A furnace repair team that services an average of four furnaces a day if the design capacity is six furnaces a day and the effective capacity is five furnaces a day.c. Would you say that systems that have higher efficiency ratios than other systems will always have higher utilization ratios than those other systems? Explain.arrow_forwardIIn a job shop, effective capacity is only 69 percent of design capacity, and actual output is 76 percent of effective output. What design capacity would be needed to achieve an actual output of 13 jobs per week? What is its effective capacity? a. The Design Capacity needed to achieve the required actual job outputs =Blank 1 (round to whole number) b. The Effective Capacity needed to achieve the required actual job outputs = Blank 2 (round to whole number) Blank 1 Blank 2 Add your answer Add your answerarrow_forwardCompute the capacity (i.e. processing rate) for each of the following scenarios. Convertyour answers to parts per hour.a. A four-station line with single-machine stations, where the average processing timesare 15, 20, 10 and 12 minutes, respectively.b. A three-station line where the number of machines at stations 1, 2 and 3 is 2, 6, and3, respectively; and the average processing times are 10, 24 and 18 minutes,respectively.arrow_forward
- Ex 5 Fitzsimmons & Fitzsimmons (2008) compare 2 capacity management strategies. Part of their comparison is presented below: Capacity plan: Level Capacity Chase Demand Customer waiting Generally low Moderate High Long run Labour skill level Low Forecasting Short run a) Motivate why the forecasting horizon is longer for Level capacity plans. b) Which assumption is used to reach the conclusion that a level capacity plan has a shorter customer waiting time?arrow_forwardA manager must decide which type of machine to buy, A, B, or C. Machine costs are as follows: Machine CostA $40,000B $30,000C $80,000Product forecasts and processing times on the machines are as follows: Processing Time per Unit (minutes) Product Annual Demand A B C 1 16000 3 4 2 2 12000 4 4 3 3 6000 5 6 4 4 30000 2 2 1 a.) Assume that machines operate 10 hours a day, 250 days a year. If we only consider purchasing costs, which machine would have the lowest total cost? b.) Assume machines operate 10 hours a day, 250 days a year. If we select machine A, how many machine A do we need? (Use common sense to decide the answer.)arrow_forwardThe information we need when discussing the capacity of our facility is Select one: a. All the Given options b. Amount of available capacity c. Effectiveness of the capacity use d. Maximum capacity productionarrow_forward
- A computer repair service has a design capacity of 80 repairs per day. Its effective capacity, however, is 64 repairs per day, and its actual output is 62 repairs per day. The manager would like to increase the number of repairs per day. Which of the following factors should the manager investigate: quality problems, absenteeism, or scheduling and balancing? Explain .arrow_forwardIn 2006, Shouldice Hospital admitted 14,965 patients. In 2007, a 20% increase in admissions is expected. Currently the hospital has 390 beds. Assume the hospital operates 365 days a year (and, please assume one patient per bed!).i. If the average patient stays in the hospital 8 days, how many beds were empty, on average, in 2006?ii. On average, how many beds do you expect to be empty in 2007?arrow_forwardWhich answer is FALSE and explanation A populer fast food restaurant has one cashler who takes an average of 1.5 minutes to serve a customer.suppose demand at the restaurant is forecast to be 35 Customers per hour from 11am to 1 prn and 50 customers per hour from 6 pm to 8 pm.which of the following statements are false? (a) The flowrate of the restaurant is 35 customers per hour during the 11am to 1pm period and 40 customers per hour during the 6pm to 8pm period (b) The flowrate of the restaurant is 35 customers per hour during the 11am to 1pm period and 50 customers per hour during the 6pm to 8pm period (c) The capacity of the restaurant is 40 customers per hour during both time intervals - 11am to 1pm and 6pm to 8pm (d) the utilization of the cashier is 87.5% during the 11am to 1pm period and 100% during the 6pm to 8 pm periodarrow_forward
- The manager of a car wash must decide whether to have one or two wash lines. One line will mean a fixed cost of $6,000 a month, and two lines will mean a fixed cost of $10,500 a month. Each line would be able to process 15 cars an hour. Variable costs will be $3 per car, and revenue will be $5.95 per car. The manager projects an average demand of between 14 and 18 cars anhour. Would you recommend one or two lines? The car wash is open 300 hours a month.arrow_forwardThomas Pang Furniture produced 70,000 Executive chairs per week. The effective capacity is 71,000 chairs. The production line operates 5 days per week with two 6-hour shifts per day. The line was designed to process the Executive chairs at the rate of 1,200 per hour. Determine the design capacity, utilization and efficiency for this plant when producing the Executive chair. Thomas Pang Furniture now needs to increase production of the Executive chairs. A second production line will be added. Effective capacity on this second line is the same as the first line at 71,000 Executive chairs. The first line is operating at a higher efficiency but output on the second line will be no more than 75% because the crew will be primarily new hires. Determine the expected output of this second line.arrow_forwardWhat is the fundamental distinction between design capacity and effective capacity? Provide a brief examplearrow_forward
- Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,