Case Study Minnetonka Warehouse
Topics: Expected value, Costs, Probability theory, Trucks, Random variable, The Work / Pages: 2 (445 words) / Published: Apr 30th, 2013

CASE 10-1: MINNETONKA WAREHOUSE

Question 1: For each of the four work team sizes, calculate the expected number of trucks in the queue waiting to be unloaded.

Size of team Number of trucks in queue
2 3.2
3 .5
4 .27
5 .12

Question 2: For each of the four work team sizes, calculate the expected time in the queue—that is, the expected time a truck has to wait in line to be unloaded.

Size of team Expected time in queue
2 .8 hours
3 .125 hours
4 .067 hours
5 .030 hours

Question 3: For each of the four work team sizes, what is the probability that a truck cannot be unloaded immediately?

Size of team Probability that truck must wait upon arrival
2 80%
3 50%
4 40%
5 30%

Question 4: Which of the four work teams has the lowest cost to Wayne?

Size of team Total cost
2 $268.00
3 $102.00
4 $96.00
5 $95.32

Question 5: Wayne is also considering rental of a forklift to use in truck unloading. A team of only two would be needed, but the hourly cost would be $38 per hour ($28 for the workers and $10 for the forklift). They could unload a truck in five minutes. Should Wayne rent the forklift?

A two-person crew and a forklift will cost $38 per hour. Compare this with the answers in question 4; Wayne should adopt a two-man crew and use a forklift.

Question 6: Disregard your answer to question 5. Labor negotiations are coming up and Wayne thinks he can get the union to give way on the work rule that prohibits warehouse workers on the unloading dock from being given other assignments when they are not unloading trucks. How much would Wayne save in unloading dock costs if he could reassign warehouse workers to other tasks when they are not unloading trucks, assuming that he has picked a good team of workers and each worker works 8 hours a day?

From the printouts, we must determine how much “idle time” there is with the present system. This depends in part upon the crew size. For a crew of four, for example, 24 minutes per

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