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Chapter 10, Problem 12

A) How many administrative clerks should be hired, assuming a target utilization fo

Clerks do stage A and B, for a combined 8 minutes, which translates into a capacity o

Utilization = Demand Rate / (Service Rate * Number of Servers)

0.85 = 27 / (7.5*N) = 4.235294118

4 clerks should be hired

B) What is the current labor utilization of the coders if two coding specialists are cu

Utilization = Demand Rate / (Service Rate * Number of Servers)

Utilization % = 27 / (10*2) 1.35 OR 135%

With 2 coding specialists, utilization is 135%. This is a bottleneck.

C) What is the total process (Output) capacity in units per hour for the five-stage pr

A+B C D+E
Demand 27 27 27
Time/Job M. 8 6 8
# Workers 3 2 4
Capacity one person/Hr 7.5 10 7.5
Total Capacity 22.5 20 30
Utilization 1.2 1.35 0.9
Total process output is 20 units/Hr. Stage C (Coding) is the bottleneck.

D) Where do any bottleneck exist, and what do you recommend to improve this pro

Coding specialists are the bottlneck, and administrative clerks are really close too. Th
If there was 1 worker at each station, capacity would be:
Stage A = 12 Units/Hr
Stage B = 20 Units/Hr
Stage C = 10 Units/Hr
Stage D = 15 Units/Hr
Stage E = 15 Units/Hr

uming a target utilization for them of 85%?

translates into a capacity of 7.5 units/hour.

wo coding specialists are currently on duty?

er hour for the five-stage process A to E, assuming three administrative clerks, two coding specialists, and four assistant mana

Stage A and B = 22.5 Units/Hr


Stage C = 20 Units/Hr
Stage D and E = 30 Units/Hr
he bottleneck.

mmend to improve this process?

erks are really close too. This might be improved with the following: Reduce standard processing times (work faster) using bette
cialists, and four assistant managers are on duty?
g times (work faster) using better training and equipment; Hire additional labor

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