Operations Management

Topics: Wells Fargo, Capacity utilization, Flowchart Pages: 4 (1013 words) Published: September 6, 2011
1.(15 pts) Question 2.1 (page 41 in the textbook)

The capacity of resource 1 is (60/10)*2=12 units per hour.
The capacity of resource 2 is (60/6)*1=10 units per hour.
The capacity of resource 3 is (60/16)*3=11.25 units per hour. Resource 2 is the bottleneck and the process capacity is 10 units per hour. The flow rate would be 8 units per hour if demand rate is 8 units per hour. The utilization rate of resource 1 is 8/12=66.7%

The utilization rate of resource 2 is 8/10=80%
The utilization rate of resource 3 is 8/11.25=71.1%

2.(10 pts) A processor makes two components, A and B, which are then packaged together as the final product (each product sold contains one A and one B). The processor can do only one component at a time: either it can make As or it can make Bs. There is a setup time when switching from A to B (or B to A).

Current plan are to make 100 units of component A, then 100 units of component B, then 100 units of component A, then 100 units of component B, and so forth, where the setup and run times for each component are given below.

ComponentSetup/Charge over TimeRun Time/Unit
A 5 minutes0.2 minutes
B10 minutes0.1 minutes .

Assume the packing of the two components is totally automated and is small enough that you can ignore it. What is the average hourly output, in terms of the number of units of packaged product (which includes one component A and one component B)?

It takes 5 + 100*0.2 + 10 + 100*0.1 = 45 minutes to make 100 products. The capacity is 100/(45/60) = 133.3 units per hour.

3.(20 points) Wells Fargo has adopted lean philosophy for its document management team that provides paper imaging, electronic document routing, data lifting, and document storage services to the Home and Consumer Finance division. One function area of the document management team is paper imaging, which enables Wells Fargo to store information electronically. When loan documents arrive, the papers are...
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