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Assignment

Within your analyses on the first - Data-driven decision-making aka data analytics and third - your choice of
one from among
Decision support systems
Outsourcing to include offshoring, re-shoring, and next-shoring
Sustainable supply chain management- techniques, address the following:
Q1. What is the general purpose of the technique?
A1: The general purpose of linear programming technique is to identify best suitable decision variable so that
we get the optimize objectives (e.g. least possible cost, max profit etc)
Q2. How does or should this help operations in general?
A2: By using linear programming technique, we take the efforts of manually selecting decision variables. Also
the results are optimized and hence, we get the maximum possible savings or least possible cost.
Q3. What are the limitations of the technique?
A3: The technique depends heavily on the given datas accuracy. If the data in real life is going to be slightly
fuzzy, then the technique might not provide optimized solution. In other words, if the given schedule is followed
as it is, only then we will get optimized costs.
Q4. What are the costs involved? What training is needed to use the technique? What else is needed?
A4: It costs time to formulate and solve the problem on MS excel or any other spread sheet program.
The operator need training in using linear programming, basic computing skills and use of Spread sheet
programs.
Apart from that, we would need accurate data to start with the model formulations.
Q5. At Acme Mexico City, what is the problem, opportunity, or challenge that this technique can address?
A5: In Acme Mexico City the problem is managing on flour service personals. Due to obvious reasons, cost
need to be minimized, best services need to be given to customers, legal and human resource requirements too
need to be followed and company policies to be followed as well.
The opportunity that this techniques can address is optimizing manpower scheduling and derive the minimum
costs and hence maximum savings.
Q6. How will the technique help Acme Mexico City's operations? Why?
A6: The technique and its application gave a best solution of manpower planning across the day. It shows how
many employees need to join when and when they should take their lunch/dinner breaks. Hence decision
making process on the whole case is automated.
Also, the provided decision by the techniques is guarantee to be the lowest cost solution. And hence there can
be minimum cost of employees in following the given schedule.
Q7.What would be the areas that present challenges in the approach (e.g., cost, personnel, training,
culture, technology, management commitment, etc.?)
A7: There are several challenges to derive the optimized cost structure as provided by the linear programming
technique.
1. Personnel need to be trained well to fulfill each others positions and need to be flexible in their
skill sets
2. The culture of the organization should be customer friendly and the whole process should be
designed with customer as focus. Otherwise it will not be as impactful as it would be planned.
Also to take lunch/dinner at designated time should be compatible with the organizational
culture.

3. Management commitment comes for developing such solutions and then implementing it full
heartedly. If the solution cannot be applied completely, the developers and decision makers will
lose faith.
Within your analysis on linear programming applied at Acme Mexico City, address the following:
1. What is the recommended low-cost (not necessarily the minimum cost) customer service employee
daily assignment schedule?
Ans: The solution is shown at the attached excel file. The brief of the manpower planning solution is as follows:
Full Time
Joined
1st
lunch
2nd
Tim 7am
lunch
e
8am
PT
join

1st
shift
11
6

5
8am
9am
1

2nd
shift
12
5

9am
10a
m

10a
m1am

Total
23
11
12
11a
m12n
6

12n1pm

1pm
2pm

2pm
3pm

3pm
4pm

4pm
5pm

5pm
6pm

6pm
7pm

7pm
8pm

Total

45

2. What are your underlying assumptions and any qualitative factors that you believe are involved?
Ans: The assumptions and qualitative factors are as follows:
The schedule given will be exactly followed by all employees (no late coming-early going, no change in
lunch/dinner breaks)
The requirements given would be exactly like this and there would be no changes in that during the day
All employees are equally capable and each can match capabilities of others
All employees skills are flexible enough to substitute for any other employees.
3. How might non-typical days affect the schedule?
Ans: The solution provided assumes the demand for personal remains as given data. However, there can be
some non-typical days (Sundays or holidays) where demand would be shifted across the day. And it is also
possible that it cannot be predicted in real time. At such times, we cannot use the schedule created here. As it
will not meet the demand of a non-typical day. For those days, a separate problem with correct demand data
need to be used.
Optionally, and for extra points to be determined by your section professor, provide a sensitivity analysis that
shows how relaxation of the 50% constraint on the hours worked by part-time customer service employees
might affect the daily personnel costs.
By relaxing the 50% of hours worked by part time employees, we get completely different result. The outcome
is shown in the 2nd sheet named optional.
Here, the highlight of the result is like this:
Only 1 full time employee need to be hired. He will come in 2nd shift and take 1st dinner break
There will be total 85 part time employees would be hired at different point in time. The joining
schedule is as below:
Tim
e
PT

9am
7am 8am 10a
8am 9am m
11
1
6

10a
m11a
m

11am
1pm 2pm 3pm 4pm 5pm 6pm 7pm
12no
12noo on
n-1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm Total
4
11
5
6
3
15
1
9
2
11
85

join
ed
Total 340 out of 348 hours would be worked by part time employees only
The total cost of employees would be $ 43,600. Lower by $ 4200 then earlier solution with 50%

constraint.
The following information is provided for your use in this linear programming analysis:
To the extent permitted by local law, each Acme Home Improvements store, including Acme Mexico City, is
open from 7 am - 11 pm every day. Acme Mexico City advance planners in North Carolina have provided the
following table, which identifies the minimum number of customer service employees estimated to be needed
on the floor of the store each hour of a typical work day:
Customer Service Employees
Time Period Minimum number needed on the floor
7 am - 8 am 10
8 am - 9 am 12
9 am - 10 am 18
10 am - 11 am 22
11 am - 12 pm 22
12 pm - 1 pm 26
1 pm - 2 pm 26
2 pm - 3 pm 26
3 pm - 4 pm 26
4 pm - 5 pm 26
5 pm - 6 pm 28
6 pm - 7 pm 28
7 pm - 8 pm 24
8 pm - 9 pm 22
9 pm - 10 pm 14
10 pm - 11 pm 12
In the interest of cost control, the planners have also imposed a not-to-exceed maximum of 30 customer
service employees on the floor at any time.
Full-time customer service employees at AMC work a 9 hour shift (8 hours of work plus a 1 hour meal
break) either from 7 am to 4 pm or from 2 pm to 11 pm.
Workers on the 7-4 shift are assigned an hour-long lunch break at either 11 am or 12 noon. Workers on
the 2-11 shift are assigned an hour-long dinner break at either 5 pm or 6 pm.
Part-time customer service employees work four consecutive hours per day and their shifts can start any
hour between 7 am and 7 pm. They receive no meal breaks.
By corporate policy, which is consistent with Mexican labor law, the company limits the hours worked
by part-time customer service employees to 50% of the day's total scheduled hours.
Part-time customer service employees earn $500 per day, and full-time customer service employees earn
$1100 per day in salary and benefits (here, $ = Moneda Nacional, i.e., the Mexican peso).
Acme operations analysts working in North Carolina, working with the AMC advance planners, have used
linear programming to propose in accordance with the foregoing factors, an employee assignment schedule for a
typical day. Their proposed schedule is the following item in Course Content. You may elect to recommend this
schedule or to recommend one that is different.

Answer
The linear programming model is developed in the attached spread sheet. Please refer to it for further
explanation

Model Explanation:

Given data: Cells in column A:B shows given data on employee requirement at each hour of the
operation of AMC since 7 AM to 11 PM

Decision Variables: Cells in column D:G represents decision variables.


1. Cells D2:G5 represents the number of employees joining in 1 st or 2nd shift as full time, and when
would they take their lunch breaks according to the data given in the case.
2. Cells D7:E21 represents the number of employees joining at 7 AM to 7 PM work hours as part
time

Calculations: Cells in column I:N shows the calculations of employees on the floor at any given point
of time
The calculation of full time employees are explained in detail here:
1. The number of full time employees between 7 AM to 11 AM, and 1 PM to 2 PM are those who
joined in the first shift
2. The number of full time employees between 11 AM to 12 noon are those who joined in the first
shift minus those having 1st lunch break
3. The number of full time employees between 12 noon to 1 PM are those who joined in the first
shift minus those having 2nd lunch break
4. The number of full the employees between 2 PM to 4 PM is sum of employees joined in 1 st and
2nd shifts
5. The number of full the employees between 4 PM to 5 PM and 7 PM to 11 PM is sum of
employees joined in 1st and 2nd shifts
6. The number of full the employees between 5 PM to 6 PM are employees joined in 2 nd shifts
minus those having their 1st dinner break
7. The number of full the employees between 6 PM to 7 PM are employees joined in 2 nd shifts
minus those having their 2nd dinner break
The calculations of part time employees are explained in detail here:
1. The number of part time employees in any hours are sum of the part time employees joined in
last 4 hours
The total employees on floor is sum of full time and part time employees at any given time
The total hours worked by both full time and part time employees are shown in cells I20:L20
Column N represents the required employees on floor at any given point of time. The total employees
must be greater than or equal to required employees

Constraints: Cells P1:U5 shows the constraints of the model


1. Total part time work hours (Cell K20) must not exceed 50% of total work hours (Cell L20)
2. Max total no of employees at any point of time must not exceed 30
3. Total no of present employees at any given time must be greater than or equal to the
requirements
4. All number of employees are integers

Costings: Cells P7:U10 shows the costings calculations


1. Total no of Full time employees (Cell G3) x $ 1100 will give full time employees costing per day
2. Total no of Part time employees (Cell E21) x $ 500 will give part time employees costing per day
3. Total costing is sum of full time and part time employees costings

Outcome:
By optimizing the model using in build solver engine, we get following output:
Objective function = min total cost per day is $ 47,800
Full time employees schedule:
Full Time
Joined
1st
lunch
2nd
lunch

1st
shift
11
6

2nd
shift
12
5

Total

12

Part time employees schedule:


Time
7am-8am
8am-9am
9am-10am
10am-11am
11am12noon
12noon1pm
1pm-2pm
2pm-3pm
3pm-4pm
4pm-5pm
5pm-6pm
6pm-7pm
7pm-8pm
Total

23
11

PT
joined
0
1
6
8
6
0
1
0
6
7
8
2
0
45

Costings
Costings
1 FT Employees
2 PT employees
Total

salary
2
3
4
5
6
8

Cost
$

1,100
$ 500

$ 25,300
$ 22,500
$ 47,800

Executive Summery
Acme Mexico City provides solutions for home improvements. They need
customer service employees to fulfill needs of the customers. The store is
open from 7 AM to 11 PM. And the requirements of number of customer
service employees each hour is different. On the supply side, they can have
full time employees and part time employees. Both category have their own
working hour patterns, salary packs and other limitations.
The problem statement hence is to schedule the customer service
employees in such a way that it fulfills all the requirements
1. It should meet company policy for no more than 30 employees on
floor at a time
2. Part time employees should not contribute more than 50% of working
hours
3. At all working hours, requirements of customer service employees
must be met
Apart from this, the cost of whole scheduling operation should be minimized.
To solve this, we used Linear Programming techniques. Here, we use
existing data given in the case and then create an optimization model in a
spread sheet. We incorporated various constraints: both given in the case and
mathematically required. And derive a set of decision variables for
scheduling purpose. The solution can be seen in the excel file. The model is
flexible so that any possible changes in policies can be easily inculcate and
results can be seen immediately.
By following these decision variables, we get an employee schedule
which not only fulfill all the requirements but also optimizes costs and
delivers results at least possible cost.