OPERATIONS MANAGEMENT

ASSIGNMENT # 3 (Total 100 points)

Due Friday July 7, 2023

Question 1. (Total 30 points)

A new student-run café has just opened on campus, offering their own, locally brewed specialty
coffees. The first week of operations was more popular than anticipated and there were long
line ups at the café; it was observed that on average 40 customers per hour arrived at the café;
on average, it took 6.75 minutes to serve a customer. During the hours of operation, there were
5 employees serving the counter. Based on the first week of operations, determine the
following:

a) On average, how many customers were at the counter (including those being served)?
b) What was the average time a customer had to wait to be served (in minutes)?
c) If a customer had to wait, how long was the average wait time (in minutes)?
d) What is the probability a customer will have to wait for service?

As a result of the first week, the students are considering increasing the number of employees
serving the counter. To help to make the decision, they have learned from their marketing
professor that industry standards suggest a waiting customer costs a company $7.50/hour;
they have also determined that each additional employee will actually increase service time
by half a minute. Employees are paid $15/ hour.

e) Determine the total hourly cost at the current level (5 employees) and with additional
employees. How many employees minimize total cost?
f) Recalculate the performance measures of a), b), c) and d) with the number of employees
recommended in part e). What do you notice about the new performance measures?

Operations Management Assignment #3 Page 1

Question 2. (Total 50 points)

Information concerning the product structure, lead times and quantities on hand for an electric
golf cart is shown in the following table. Use this information to do each of the following:

a) Draw the product structure tree

b) Develop the material requirements plan that will provide 100 golf carts at the start of week
6, 100 golf carts at the start of week 8, and 100 golf carts at the start of week 9; assume lot-
for-lot ordering for all parts except supports in lots of 100 and seats in lots of 50.

Note: Template for MRP included here; print as many copies as necessary

Parts List for Electric Golf

Lead Time Quantity on Hand
Cart
Electric Golf Cart 1 0
Top 1 40
Base 1 20
Top
Supports (4) 1 200
Cover 1 0
Base
Motor 2 300
Body 2 50
Seats (2) 3 120
Body
Frame 1 35
Controls 1 0
Wheels (4) 1 240

Question 3. (Total 20 points):

Refer to Question 2. Assume that unusually mild weather has caused a change in the quantity
and timing of orders for golf carts. The revised plan calls for 200 golf carts at the start of week 8.

a) Determine the timing and quantities of orders for top and base
b) Assume that equipment problems have resulted in the manufacturer being able to assemble
supports and seats as lot for lot ordering. Revise your material requirements plan for
supports and seats to reflect this.

Note: Template for MRP included here; print as many copies as necessary

Operations Management Assignment #3 Page 2

 Beg
1 2 3 4 5 6 7 8 9
Inv.
Gross Requirements
Scheduled Receipts
Projected On Hand
Net Requirements
Planned Order Receipt
Planned Order Release

Beg
1 2 3 4 5 6 7 8 9
Inv.
Gross Requirements
Scheduled Receipts
Projected On Hand
Net Requirements
Planned Order Receipt
Planned Order Release

Beg
1 2 3 4 5 6 7 8 9
Inv.
Gross Requirements
Scheduled Receipts
Projected On Hand
Net Requirements
Planned Order Receipt
Planned Order Release

Beg
1 2 3 4 5 6 7 8 9
Inv.
Gross Requirements
Scheduled Receipts
Projected On Hand
Net Requirements
Planned Order Receipt
Planned Order Release

Operations Management Assignment #3 Page 3