HW-7_Review_OM235_Fa23_2023-09-29b
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University of Texas *
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Course
235
Subject
Industrial Engineering
Date
Dec 6, 2023
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docx
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OM 235
Homework-7
Fall 2023
Please place each of your answers inside the rectangular box that is next to each question. Each question
is worth one point unless otherwise indicated. There are 24 possible points total. (Revised: Sept. 29,
2023.)
Name:
Question 1
.
Review on process analysis
Westlake Custom Car Detail (WCCD) provides detailing (intensive car cleaning) services to antique and
collector cars.
Taddeo D’Andrea, the owner of the establishment has an online webpage which schedules
appointments for car owners so that the arrival rate of cars at WCCD never exceeds its process capacity, (i.e.
it’s run as a just-in-time process).
Taddeo has asked you, as a fellow UT BBA alum, to take a look at his
process and make recommendations about how to improve it.
During the process, Taddeo greets the clients, asks for some background information, and then directs the
car to one of the detailers.
The client is sent to a waiting room while the bill is prepared by Caterina.
Taddeo then collects the payment himself.
After both the payment is collected and the detailing completed,
Maria guides the client to the car and says goodbye. The first thing you do is document the process flow
with a process flow diagram, which is shown below.
The next thing you do is perform analysis of the common operations metrics as shown in the sub-
problems below.
Note that each client brings exactly one car to WCCD, and that 3 clients arrive per
hour on average.
1
(a) What is the Rush Order Flow time of the process above in minutes?
10+45+5=60
(b) What is the process capacity in clients/hour?
60*(1/16)= 3.75 clients/hour
(c)
What is the process flow rate (throughput) in clients per hour?
Demand is lower than capacity
(d) If there is an average of 11 cars at WCCD at any one time, what is the average
amount of time a car spends at WCCD in hours?
I = r*t
11 = 3 * t
(e)
What is the labor utilization for Giorgio, Carlo, and Guido in percent?
3/45 min = 15 min
3 clients/hour/4 clients/hour
(f)
What is the utilization of Taddeo?
16 min/client
3 clients/hour/3.75 clients/hour
2
60
3.75
clients/hour
3 clients/hour
3.67
hours
75%
80%
Question 2
.
Review on financials
Continuing with Westlake Custom Car Detail, you examine its financials.
(a) If clients pay $60/vehicle for detailing, each employee costs $20 per hour, and
materials (soap, wax, etc.) cost $10/vehicle, what is the profit of WCCD in dollars
per hour? Note that employees cannot be fired, so they are a fixed cost.
(60-10)*3-120=30 dollars/hour
(b) What is WCCD’s operating leverage?
(60-10)/((60-10)+40) = 50/90 = .556
(c)
What is WCCD’s breakeven volume in clients per hour?
X= 2.4
0 = 50x-120
(d) Across town WCCD’s competitor, Lake Travis Custom Detailing offers the same
product, but uses a different process? Its operating leverage is 3.0. If it can draw
enough clients away from WCCD to raise Lake Travis’s own throughput by 5%,
what would the percentage increase in Lake Travis’s profit be?
3*5 = 15
3
$30/hr
.556
2.4
clients/hour
15%
Your preview ends here
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Question 3.
Following are some examples of questions on strategy and management concepts that might appear on
the midterm. Note that the number of these types of questions will be higher on the midterm.
Each of these questions is worth 2 points.
(a) [2 points] Having excessive inventory in your firm increases all of the following
EXCEPT:
1.
Warehousing costs
2.
Shrinkage
3.
Capital tied up in inventory
4.
Profit margin
(b) [2 points] Which of the following location strategies will most improve your
supply chain’s resiliency for a given part?
1.
Sourcing your parts only from suppliers located within 50 miles of Austin
2.
Sourcing some of your parts from suppliers in Germany and others from
Vietnam
3.
Sourcing your parts from a single supplier in Malaysia
4.
Sourcing your parts from a single supplier, which is offering a low cost due to
its financial troubles.
(c) [2 points] Your firm’s supply chain decisions influence all of the below
EXCEPT?
1.
Your products’ total carbon footprint
2.
The quality of life for employees in your supply chain
3.
Your vulnerability to trade disputes
4.
Your advertising strategy
5.
The price of your raw materials
(d) [2 points] Which of the below might increase waiting time for dine-in customers
at Paramount?
1.
Partnering with Doordash
2.
Fewer cooks
3.
More variability in the arrival rates of customers
4.
Actually, all of the above might increase waiting time at Paramount
4
4
1
4
4
Question 4.
Preparation for Quality.
These will be graded on completion.
If you were going to buy a new computer, list 3 important factors you personally would consider when deciding
which computer to purchase. Note that there is no “right” answer to this question, the answers should be based on
your own preferences. Also, this is not an essay question. You only need put a word, or a couple of words, such as
“reliability”, “customer support”, “processing speed”, etc.
(a) [2 points] Your most important decision factor
(b)
[2 points] Another important decision factor
(c)
[2 points] Something that would be nice for your computer to have but is not a “deal-breaker.”
5
Quality
Price
Sleek look