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Queuing Models
2
The other line
always moves faster.
If you change lines, the one you left
will start to move faster than the one
youre in.

Murphys Law
1995 Corel Corp.
Thank you for holding.
Hello...are you there?
Youve Been There Before!
3
Introduction
Queuing is the study of waiting lines, or queues.
The objective of queuing analysis is to design
systems that enable organizations to perform
optimally according to some criterion.
Possible Criteria
Maximum Profits.
Desired Service Level.
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Introduction

First studied by A. K. Erlang in 1913
Analyzed telephone facilities
Body of knowledge called queuing theory
Queue is another name for waiting line
Decision problem
Balance cost of providing good service with cost of
customers waiting
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Level of service
Cost
Waiting time cost
Optimal
Introduction: Waiting Line Costs
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Introduction
Analyzing queuing systems requires a clear
understanding of the appropriate service
measurement (KPIs).
Possible service measurements (KPIs)
Average time a customer spends in line.
Average length of the waiting line.
The probability that an arriving customer must wait
for service.
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Introduction: The Queuing System
Customer
Server
Customers waits in queue
Service
Customer completes
service and leaves
Customers arrives
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Bank Customers Teller Deposit etc.

Doctors Patient Doctor Treatment
office

Traffic Cars Light Controlled
intersection passage

Assembly line Parts Workers Assembly

Tool crib Workers Clerks Check out/in tools

Situation Arrivals Servers Service Process
Waiting Line Examples
9
Three Parts of a Queuing System at Daves Car-Wash
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Elements of the Queuing Process
A queuing system consists of three basic components:
Arrivals: Customers arrive according to some arrival
pattern.

Waiting in a queue: Arriving customers may have to wait in
one or more queues for service.

Service: Customers receive service and leave the system.
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Service
Facility
Waiting Line
Arrival rate distribution
Poisson
Other
Pattern of arrivals
Random
Scheduled

Arrival Characteristics
Characteristics of a Waiting Line System
Size of the source population
Limited
Unlimited
Behavior of the arrivals
Join the queue, and wait until served
Balk; refuse to join the line
Renege; leave the line

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Input Source
(Population)
Size
Infinite
Input Characteristics
13
Input Characteristics
Input Source
(Population)
Size
1995 Corel Corp.
Infinite Finite
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Input Source
(Population)
Size
Arrival
Pattern
Finite Infinite Random
Non-
Random
Input Characteristics
15
Input Source
(Population)
Size
Arrival
Pattern
Finite Infinite Random
Non-
Random
Poisson Other
Input Characteristics
16
Under three conditions the arrivals can be modeled as a
Poisson process
Orderliness : one customer, at most, will arrive during any
time interval.
Stationarity : for a given time frame, the probability of arrivals
within a certain time interval is the same for all time intervals of
equal length.
Independence : the arrival of one customer has no influence
on the arrival of another.
The Arrival Process
17
P(X = k) =
Where
= mean arrival rate per time unit.

t = the length of the interval.

e = 2.7182818 (the base of the natural logarithm).
k! = k (k -1) (k -2) (k -3) (3) (2) (1).
(t)
k
e
- t
k!
The Poisson Arrival Process
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Number of events that
occur in an interval of time t
Example: Number of
customers that arrive in
15 min.
Mean = (e.g., 5/hr.)
Probability:
,0
,3
,6
0 1 2 3 4 5
X
P(X)
,0
,3
,6
0 2 4 6 8 10
X
P(X)
= 0.5
= 6.0
Poisson Distribution
!
) (
) (
k
t e
k X P
k t


= =
19
Poisson Distributions for Arrival Times
0.00
0.05
0.10
0.15
0.20
0.25
0.30
0 1 2 3 4 5 6 7 8 9 10 11 12
x
0.00
0.05
0.10
0.15
0.20
0.25
0.30
0 1 2 3 4 5 6 7 8 9 10 11 12
x
P
r
o
b
a
b
i
l
i
t
y

P
r
o
b
a
b
i
l
i
t
y

=2 =4
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HANKs HARDWARE Arrival Process
Customers arrive at Hanks Hardware according to a
Poisson distribution.
Between 8:00 and 9:00 A.M. an average of 6 customers
arrive at the store.
What is the probability that k customers will arrive
between 8:00 and 8:30 in the morning (k = 0, 1, 2,)?
21

k
Input to the Poisson
distribution
= 6 customers per hour.
t = 0.5 hour.
t = (6)(0.5) = 3.

(t)

e
- t
k !
=
0
0!
0.049787
0
1!
1
0.149361
2
2!
0.224042
3
3!
0.224042
1 2 3 4 5 6 7
P(X = k )=
8
0
1
2
3
HANKs HARDWARE
An illustration of the Poisson distribution.
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HANKs HARDWARE
Using Excel for the Poisson probabilities
Solution
We can use the POISSON function in Excel to
determine Poisson probabilities.
Point probability: P(X = k) = ?
Use Poisson(k, t, FALSE)
Example: P(X = 0; t = 3) = POISSON(0, 3, FALSE)
Cumulative probability: P(Xsk) = ?
Example: P(Xs3; t = 3) = Poisson(3, 3, TRUE)
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HANKs HARDWARE Excel Poisson
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Input Source
(Population)
Size Behavior
Arrival
Pattern
Finite Infinite Random
Non-
Random
Patient Impatient
Poisson Other
Input Characteristics
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Input Source
(Population)
Size Behavior
Arrival
Pattern
Finite Infinite Random
Non-
Random
Patient Impatient
Balk Poisson Other
Input Characteristics
26
Input
source
Service
facility
Waiting
line
Service system
1995 Corel Corp.
Line was
too long!
Balking
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Input Source
(Population)
Size Behavior
Arrival
Pattern
Finite Infinite Random
Non-
Random
Patient Impatient
Balk Renege Poisson Other
Input Characteristics
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Reneging
Input
source
Service
facility
Waiting
line
1995 Corel Corp.
I give
up!
Service System
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Waiting Line
Length
Unlimited
1995 Corel Corp.
Waiting Line Characteristics
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Waiting Line
Length
Limited Unlimited
1995 Corel Corp.
1995 Corel Corp.
Waiting Line Characteristics
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Waiting Line
Length
Queue
Discipline
Limited Unlimited
FIFO
(FCFS)
Random Priority
Waiting Line Characteristics
LIFO
(LCFS)
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Service
Facility
Configuration
Multi-
Channel
Single
Channel
Single
Phase
Service Characteristics
Single
Phase
Multi
Phase
Multi
Phase
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Arrivals
Served
units
Service
facility
Queue
Service system
Dock
Waiting ship line
Ships at
sea
Ship unloading system
Empty
ships
Single-Channel, Single-Phase System
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Cars
& food
Single-Channel, Multi-Phase System
Arrivals
Served
units
Service
facility
Queue
Service system
Pick-up
Waiting cars
Cars
in area
McDonalds drive-through
Pay
Service
facility
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Arrivals
Served
units
Service
facility
Queue
Service system
Service
facility
Example: Bank customers wait in single line for one of
several tellers.
Multi-Channel, Single Phase System
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Service
facility
Arrivals
Served
units
Service
facility
Queue
Service system
Service
facility
Example: At a laundromat, customers use one of several
washers, then one of several dryers.
Service
facility
Multi-Channel, Multi-Phase System
37
In most business situations, service time varies widely
among customers.
When service time varies, it is treated as a random
variable.
The exponential probability distribution is used
sometimes to model customer service time.
The Service Process
38
The memoryless property.
No additional information about the time left for the completion of a
service, is gained by recording the time elapsed since the service
started.
For Hanks, the probability of completing a service within the next 3
minutes is (0.52763) independent of how long the customer has been
served already.

The Exponential and the Poisson distributions are related to
one another.
If customer arrivals follow a Poisson distribution with mean rate ,
their interarrival times are exponentially distributed with mean time
1/.
The Exponential Distribution -
Characteristics
39
f(t) = e
-t
= the average number of customers
who can be served per time period.
Therefore, 1/ = the mean service time.
The probability that the service time X is less than some t.

P(X s t) = 1 - e
-t
The Exponential Service Time Distribution
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Schematic illustration of the exponential
distribution
The probability that service is completed
within t time units
P(X s t) = 1 - e
-t
X = t
41
HANKs HARDWARE Service time
Hanks estimates the average service time to be 1/ =
4 minutes per customer.

Service time follows an exponential distribution.

What is the probability that it will take less than 3
minutes to serve the next customer?
42
We can use the EXPDIST function in Excel to determine
exponential probabilities.
Probability density: f(t) = ?
Use EXPONDIST(t, , FALSE)

Cumulative probability: P(Xsk) = ?
Use EXPONDIST(t, , TRUE)
Using Excel for the Exponential Probabilities
43
The mean number of customers served per
minute is = (60) = 15 customers per hour.
P(X < .05 hours) = 1 e
-(15)(.05)
= ?
From Excel we have:
EXPONDIST(.05,15,TRUE) = .5276
HANKs HARDWARE
Using Excel for the Exponential Probabilities
3 minutes = .05 hours
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HANKs HARDWARE
Using Excel for the Exponential Probabilities
=EXPONDIST(B4,B3,TRUE)
Exponential Distribution for Mu = 15
0.000
2.000
4.000
6.000
8.000
10.000
12.000
14.000
16.000
0.000 0.075 0.150 0.225 0.300 0.375
t
f
(
t
)
=EXPONDIST(A10,$B$3,FALSE)
Drag to B11:B26
45
0.
.1
.2
.3
.4
0 2 4 6 8 10
x
P
r
o
b
a
b
i
l
i
t
y

t
>
x

=1
=2
=3
=4
Service time, &
time between arrivals
Example: Service time is
20 min.
Mean service rate =
e.g., customers/hr.
Mean service time = 1/
Equation:
Negative Exponential Distribution
f(t) = e
-t
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Performance Measures of Queuing System

Performance can be measured by focusing on:
Customers in queue.
Customers in the system.

Performance is measured for a system in steady
state.
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Roughly, this
is a transient
period
n
Time
Performance Measures of Queuing System

The transient period
occurs at the initial
time of operation.
Initial transient
behavior is not
indicative of long run
performance.
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This is a
steady state
period..
n
Time
Performance Measures of Queuing
System
The steady state
period follows the
transient period.
Meaningful long run
performance
measures can be
calculated for the
system when in
steady state.
Roughly, this
is a transient
period
49

< k
Each with
service rate of
<
1
+
2
++
k
For k servers
with service rates
i

<
For one server
In order to achieve steady state, the
effective arrival rate must be less than
the sum of the effective service rates .
Performance Measures of Queuing
System
k servers
50

P
0
= Probability that there are no customers in the system.


P
n
= Probability that there are n customers in the system.


L = Average number of customers in the system.

L
q
= Average number of customers in the queue.
W = Average time a customer spends in the system.
W
q
= Average time a customer spends in the queue.

P
w
= Probability that an arriving customer must wait for service.

= Utilization rate for each server (% of time that each server is busy).
Steady State Performance Measures
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Cost
Cost of providing
service
Total expected cost
Cost of waiting time
Low level
of service
High level of
service
Optimal
service level
Minimum
total cost
Deciding on the
Optimum Level of Service
52
Littles Formulas represent important relationships
between L, L
q
, W, and W
q
.
These formulas apply to systems that meet the
following conditions:
Single queue systems,
Customers arrive at a finite arrival rate , and
The system operates under a steady state condition.

L = W L
q
= W
q
L = L
q
+ /
Littles Formulas
For the case of an infinite population
W = W
q
+ 1/
53
Queuing system can be classified by:
Arrival process.
Service process.
Number of servers.
System size (infinite/finite waiting line).
Population size.
Notation
M (Markovian) = Poisson arrivals or exponential service time.
D (Deterministic) = Constant arrival rate or service time.
G (General) = General probability for arrivals or service time.
Example:

M / M / 6 / 10 / 20
Classification of Queues
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M/M/1 Queuing System - Assumptions
Poisson arrival process.
Exponential service time distribution.
A single server.
Potentially infinite queue.
An infinite population.
55
The probability that
a customer waits in
the system more than
t is P(X>t) = e
-( - )t

P
0
= 1 (/)
P
n
= [1 (/)](/)
n

L = /( )
L
q
=
2
/[( )]
W = 1 /( )
W
q
= /[( )]
P
w
= /
= /
M / M /1 Queue - Performance Measures
56
MARYs SHOES
Customers arrive at Marys Shoes every 12 minutes on
the average, according to a Poisson process.

Service time is exponentially distributed with an
average of 8 minutes per customer.

Management is interested in determining the
performance measures for this service system.
57
MARYs SHOES - Solution
Input
= 1/12 customers per minute = 60/12 = 5 per hour.
= 1/ 8 customers per minute = 60/ 8 = 7.5 per hour.
Performance Calculations
P
0
= 1 - (/) = 1 - (5/7.5) = 0.3333
P
n
= [1 - (/)](/)
n
= (0.3333)(0.6667)
n


L = /( - ) = 2
L
q
=
2
/[( - )] = 1.3333
W = 1/( - ) = 0.4 hours = 24 minutes
W
q
= /|( - )] = 0.26667 hours = 16 minutes
P
w
= / = 0.6667
= / = 0.6667
P(X<10min) = 1 e
-2.5(10/60)
= .341
= 7.5 5 = 2.5 per hr.
58
MARYs SHOES - Spreadsheet solution
59
M/M/k Queuing Systems
Characteristics
Customers arrive according to a Poisson process at a mean
rate .

Service times follow an exponential distribution.

There are k servers, each of who works at a rate of
customers (with k> ).
Infinite population, and possibly infinite line.
60
P
n k
k
k
n k
n
k
0
0
1
1
1 1
=
|
\

|
.
| +
|
\

|
.
|

|
\

|
.
|
=

! !


P
n
P
k k
P
n
n
n
n k
=
|
\

|
.
|
s
=
|
\

|
.
|

!
!
0
0
for n k.
P for n > k.
n
M / M /k Queue - Performance Measures
61
( ) ( )
W
k k
P
k
=
|
\

|
.
|

+

1
1
2 0
!
Performance measurements L, L
q
, W
q,
, can be obtained from Littles formulas.
P
k
k
k
P
w
k
=
|
\

|
.
|

|
\

|
.
|
1
0
!

=
k
M / M /k Queue - Performance Measures
62
LITTLE TOWN POST OFFICE
Little Town post office is open on Saturdays
between 9:00 a.m. and 1:00 p.m.
Data
On the average 100 customers per hour visit the office
during that period. Three clerks are on duty.

Each service takes 1.5 minutes on the average.

Poisson and Exponential distributions describe the
arrival and the service processes respectively.
63
LITTLE TOWN POST OFFICE
The Postmaster needs to know the relevant service
measures in order to:

Evaluate the current service level.

Study the effects of reducing the staff by one clerk.
64
This is an M / M / 3 queuing system.
Input
= 100 customers per hour.
= 40 customers per hour (60/1.5).

Does steady state exist ( < k )?

= 100 < k = 3(40) = 120.
LITTLE TOWN POST OFFICE - Solution
65
LITTLE TOWN POST OFFICE solution
continued
First P
0
is found by
045 .
625 . 15
2
25 . 6
5 . 2 1
1
100 ) 40 ( 3
) 40 ( 3
40
100
! 3
1
40
100
! n
1
1
P
2
0 n
3 n
0
=
+ + +
=
|
|
.
|

\
|

|
.
|

\
|
+
|
.
|

\
|
=

=
P
0
is used now to determine all the other performance measures.
(ver slide seguinte: usando o Template Queue.xls)
66
LITTLE TOWN POST OFFICE spreadsheet Solution
M/M/k Queuing Model
INPUTS Value INPUTS Value
Lambda = 100
Mu = 40
OUTPUTS
# Servers L Lq W Wq Pw Rho Cost 0 1 2
1
2
3 6.011236 3.511236 0.060112 0.035112 0.702247 0.833333 0 0.044944 0.11236 0.140449
4 3.033095 0.533095 0.030331 0.005331 0.319857 0.625 0 0.073695 0.184237 0.230297
5 2.630371 0.130371 0.026304 0.001304 0.130371 0.5 0 0.0801 0.20025 0.250313
6 2.533889 0.033889 0.025339 0.000339 0.047445 0.416667 0 0.08162 0.204051 0.255063
7 2.50858 0.00858 0.025086 8.58E-05 0.015443 0.357143 0 0.08198 0.204951 0.256189
8 2.502053 0.002053 0.025021 2.05E-05 0.004517 0.3125 0 0.082063 0.205157 0.256446
9 2.50046 0.00046 0.025005 4.6E-06 0.001195 0.277778 0 0.082081 0.205201 0.256502
10 2.500096 9.59E-05 0.025001 9.59E-07 0.000288 0.25 0 0.082084 0.20521 0.256513
11 2.500019 1.87E-05 0.025 1.87E-07 6.34E-05 0.227273 0 0.082085 0.205212 0.256515
12 2.500003 3.4E-06 0.025 3.4E-08 1.29E-05 0.208333 0 0.082085 0.205212 0.256516
13 2.500001 5.79E-07 0.025 5.79E-09 2.43E-06 0.192308 0 0.082085 0.205212 0.256516
14 2.5 9.28E-08 0.025 9.28E-10 4.27E-07 0.178571 0 0.082085 0.205212 0.256516
15 2.5 1.4E-08 0.025 1.4E-10 7.02E-08 0.166667 0 0.082085 0.205212 0.256516
in the System where n =
Probabiility of n Customers
Server Cost =
Goodwill Cost When Waiting =
Goodwill Cost While Being Served =
67
M/G/1 Queuing System
Assumptions
Customers arrive according to a Poisson process with a
mean rate .
Service time has a general distribution with mean rate .
One server.
Infinite population, and possibly infinite line.
68
( )
L =
+
|
\

|
.
|

|
\

|
.
|
+
2
2
2 1
o

Note: It is not necessary to know the particular service time distribution.


Only the mean and standard deviation of the distribution are needed.
M/G/1 Queuing System
Pollaczek - Khintchine Formula for L
69
Teds repairs television sets and VCRs.
Data
It takes an average of 2.25 hours to repair a set.
Standard deviation of the repair time is 45 minutes.
Customers arrive at the shop once every 2.5 hours on the average,
according to a Poisson process.
Ted works 9 hours a day, and has no help.
He considers purchasing a new piece of equipment.
New average repair time is expected to be 2 hours.
New standard deviation is expected to be 40 minutes.
TEDS TV REPAIR SHOP
70
Ted wants to know the effects of using the new
equipment on

1. The average number of sets waiting for repair;

2. The average time a customer has to wait
to get his repaired set.
TEDS TV REPAIR SHOP
71
This is an M/G/1 system (service time is not
exponential - note that o = 1/).
Input
The current system (without the new equipment)
= 1/ 2.5 = 0.4 customers per hour.
= 1/ 2.25 = 0.4444 costumers per hour.
o = 45/ 60 = 0.75 hours.
The new system (with the new equipment)
= 1/2 = 0.5 customers per hour.
o = 40/ 60 = 0.6667 hours.
TEDS TV REPAIR SHOP - Solution
72
TEDS TV REPAIR SHOP - Solution
Medida de Desempenho Atual Novo
L 5.40 2.58
L
q
4.50 1.78
W 13.50 6.44
W
q
11.25 4.44
P
w
.9 .8
.9 .8
P
0
.1 .2

73
M / M / k / F Queuing System
Many times queuing systems have designs that limit their line
size.

When the potential queue is large, an infinite queue model
gives accurate results, even though the queue might be
limited.

When the potential queue is small, the limited line must be
accounted for in the model.
74
Poisson arrival process at mean rate .

k servers, each having an exponential service time with mean
rate .

Maximum number of customers that can be present in the
system at any one time is F.

Customers are blocked (and never return) if the system is full.
Characteristics of M/M/k/F Queuing System
75
A customer is blocked if the system is full.

Probability that the system is full is P
F
(that is, 100P
F
%
of the arriving customers dont enter the system).

The effective arrival rate = the rate of arrivals that make
it through into the system (
e
).

e
= (1 - P
F
)
M/M/k/F Queuing System
Effective Arrival Rate
76
RYAN ROOFING COMPANY
Ryan gets most of its business from customers who
call and order service.
When a telephone line is available but the secretary
is busy serving a customer, a new calling customer is willing
to wait until the secretary becomes available.

When all the lines are busy, a new calling customer gets a
busy signal and calls a competitor.

77
Data
Arrival process is Poisson, and service process is Exponential.

Each phone call takes 3 minutes on the average.

10 customers per hour call the company on the average.

One appointment secretary takes phone calls from
3 telephone lines.
RYAN ROOFING COMPANY
78
Management would like to design the following system:
The fewest lines necessary.
At most 2% of all callers get a busy signal.
Management is interested in the following information:
The percentage of time the secretary is busy.
The average number of customers kept on hold.
The average time a customer is kept on hold.
The actual percentage of callers who encounter a busy signal.
RYAN ROOFING COMPANY
79

This is an M/M/1/3 system
Input
= 10 per hour.
= 20 per hour (1/3 per minute).
Excel spreadsheet gives:
P
0
= 0.533, P
1
= 0.133, P
3
= 0.06

6.7% of the customers get a busy signal.
This is above the goal of 2%.
P
0
= 0.516, P
1
= 0.258, P
2
= 0.129, P
3
= 0.065, P
4
= 0.032

3.2% of the customers get the busy signal
Still above the goal of 2%


RYAN ROOFING COMPANY - Solution
M/M/1/4 system
M/M/1/5 system
P
0
= 0.508, P
1
= 0.254, P
2
= 0.127, P
3
= 0.063, P
4
= 0.032
P
5
= 0.016
So 1.6% of the customers get the busy signal
The goal of 2% has been achieved.
See spreadsheet next
80
RYAN ROOFING COMPANY - Spreadsheet Solution
81
M / M / 1 / / m Queuing Systems
In this system the number of potential customers is finite and
relatively small.
As a result, the number of customers already in the system
affects the rate of arrivals of the remaining customers.
Characteristics
A single server.
Exponential service time, Poisson arrival process.
A population size of a (finite) m customers.
82
PACESETTER HOMES
Pacesetter Homes runs four different development projects.
Data
At each site running a project is interrupted once every 20 working
days on the average.
The V.P. for construction handles each stoppage.
How long on the average a site is non-operational?
If it takes 2 days on the average to restart a projects progress (the
V.P. is using the current car).
If it takes 1.875 days on the average to restart a projects progress
(the V.P. is using a new car)
83
PACESETTER HOMES Solution
This is an M/M/1//4 system, where:
The four sites are the four customers.
The V.P. for construction is the server.
Input
= 0.05 (1/20)
= 0.5 = 0.533
(1/2 days, using the current car) (1/1.875 days, using a new car).
84
Performance Current New
Measures Car Car
Average number of customers in the system L 0.467 0.435
Average number of customers in the queue Lq 0.113 0.100
Average number of days a customer is in the system W 2.641 2.437
Average number of days a customer is in the queue Wq 0.641 0.562
The probability that an arriving customer will wait Pw 0.353 0.334
Oveall system effective utilization-factor

0.353 0.334
The probability that all servers are idle Po 0.647 0.666
Summary of results
PACESETTER HOMES Solution
continued
85
PACESETTER HOMES Spreadsheet Solution
M/M/1//m Queuing Model
INPUTS Value
0.05
Mu = 0.53333
4
Probabiility of n Customers
OUTPUTS in the System where n =
# Servers L Lq W Wq Pw Rho 0 1 2 3 4
1 0.43451 0.10025 2.43734 0.56233 0.33427 0.33427 0.66573 0.24965 0.07021 0.01317 0.00123
Lambda =
m =
86
Economic Analysis of Queuing
Systems
The performance measures previously developed are
used next to determine a minimal cost queuing
system.
The procedure requires estimated costs such as:
Hourly cost per server .
Customer goodwill cost while waiting in line.
Customer goodwill cost while being served.
87
WILSON FOODS
TALKING TURKEY HOT LINE
Wilson Foods has an 800 number to answer customers
questions.

If all the customer representatives are busy when a new
customer calls, he/she is asked to stay on the line.

A customer stays on the line if the waiting time is not
longer than 3 minutes.
88
Data
On the average 225 calls per hour are received.
An average phone call takes 1.5 minutes.
A customer will stay on the line waiting at most 3 minutes.
A customer service representative is paid $16 per hour.
Wilson pays the telephone company $0.18 per minute when the
customer is on hold or when being served.
Customer goodwill cost is $20 per minute while on hold.
Customer goodwill cost while in service is $0.05.
How many customer service
representatives should be used
to minimize the hourly cost of
operation?
WILSON FOODS - TALKING TURKEY HOT LINE
89
TC(K) = C
w
k + (C
t
+ g
s
)L + (g
w
- g
s
)L
q
WILSON FOODS Solution
The total hourly cost model
TC(K) = C
w
k + C
t
L + g
w
L
q
+ g
s
(L - L
q
)
Total hourly wages
Total average
hourly Telephone charge
Average hourly goodwill
cost for customers on hold
Average hourly goodwill
cost for customers in service
90
Input
C
w
= $16
C
t
= $10.80 per hour [0.18(60)]
g
w
= $12 per hour [0.20(60)]
g
s
= $3 per hour [0.05(60)]

The Total Average Hourly Cost =
TC(K) = 16K + (10.8+3)L + (12 - 3)L
q
= 16K + 13.8L + 9L
q
WILSON FOODS Solution continued
91
Assuming a Poisson arrival process and an Exponential service
time, we have an M/M/K system.
= 225 calls per hour.
= 40 per hour (60/1.5).
The minimal possible value for K is 6 to ensure that steady
state exists (<K).

Excel MMk worksheet was used to generate results for L,
L
q
, and W
q
.


WILSON FOODS Solution continued
92
Summary of results of the runs for k=6,7,8,9,10
K L Lq Wq TC(K)
6 18.1255 12.5 0.05556 458.64
7 7.6437 2.0187 0.00897 235.65
8 6.2777 0.6527 0.0029 220.51
9 5.8661 0.2411 0.00107 227.12
10 5.7166 0.916 0.00041 239.70
Conclusion: employ 8 customer service representatives.
WILSON FOODS Solution continued
93
WILSON FOODS Spreadsheet Solution
M/M/k Queuing Model
INPUTS Value INPUTS Value
Lambda = 225 16
Mu = 40 22.8
13.8
OUTPUTS
# Servers L Lq W Wq Pw Rho Cost 0 1 2
1
2
3
4
5
6 18.1255 12.5005 0.080558 0.055558 0.833367 0.9375 458.6364 0.001184 0.006659 0.01873
7 7.643727 2.018727 0.033972 0.008972 0.493467 0.803571 235.652 0.002742 0.015423 0.043376
8 6.277703 0.652703 0.027901 0.002901 0.275586 0.703125 220.5066 0.003291 0.018514 0.05207
9 5.866105 0.241105 0.026072 0.001072 0.144663 0.625 227.1222 0.003492 0.019641 0.055241
10 5.716569 0.091569 0.025407 0.000407 0.07122 0.5625 239.7128 0.003565 0.020056 0.056407
11 5.659381 0.034381 0.025153 0.000153 0.032853 0.511364 254.4089 0.003592 0.020206 0.056831
12 5.637531 0.012531 0.025056 5.57E-05 0.014202 0.46875 269.9107 0.003602 0.02026 0.056981
13 5.629393 0.004393 0.02502 1.95E-05 0.00576 0.432692 285.7252 0.003605 0.020278 0.057032
in the System where n =
Probabiility of n Customers
Server Cost =
Goodwill Cost When Waiting =
Goodwill Cost While Being Served =
94
HARGROVE HOSPITAL MATERNITY
WARD
Hargrove Hospital is experiencing cutbacks, and is trying to
reorganize operations to reduce operating costs.

There is a trade off between
the costs of operating more birthing stations and
the costs of rescheduling surgeries in the surgery room when women
give birth there, if all the birthing stations are occupied.

The hospital wants to determine the optimal number of birthing
stations that will minimize operating costs.
95
HARGROVE HOSPITAL MATERNITY
WARD
Data
Cutting one birthing station saves $25,000 per year.
Building a birthing station costs $30,000.
Maternity in the surgery room costs $400 per hour.
Six women on the average need a birthing station a day.
The arrival process is Poisson.
Every birthing process occupies a birthing station for two
hours on the average.
96
Solution
Analysis of the current situation
Currently there are two birthing stations
The current problem can be modeled as a M/G/2/2 queuing system.
Using the MGkk Excel worksheet with = 6 and = 12/day we have:
= .23077
W = .0833 days
P
w
= .076923
L = .46154
P
0
= .6154
HARGROVE HOSPITAL
7.7% of the arriving women are sent to
the surgery room to give birth.
97
Solution continued
The birthing stations problem can be modeled as a
M/G/k/k queuing model.
Input
= 6 women per day;
= 12 women per day (24/2);
k = the number of birthing stations used
The total cost for the hospital is
TC(k) = Cost of using the surgery room for maternity
+ Additional cost of operating k stations
HARGROVE HOSPITAL
98
Solution continued
Average daily cost of using the surgery room for maternity:
P
k
()(average time in the surgery room)(hourly cost)
Average additional daily cost of operating k stations
25,000/365 = $68.49 per day.
Average daily total cost
TC(k) = P
k
()(24/)(Hourly cost) + 68.49k
= P
k
(6)(24/12)(400) + 68.49k
= 4800P
k
+ 68.49k
HARGROVE HOSPITAL
99

k

P
k


$4800P
k

Additional
Cost of
stations
Total net
average
Daily cost
1
2
3
4
.333333
.076923
.012658
.001580
$1,600
369.23
60.76
7.58
$ 68.49
0
82.19
163.38
$1,531.51
364.23
142.95
171.96

Optimal

From repeated runs of the MGkk worksheet to determine P
k
we
got the following results:
HARGROVE HOSPITAL - Solution

Current

100
HARGROVE HOSPITAL Spreadsheet Solution
M/G/k/k Queuing Model
INPUTS Value
6
12
2
OUTPUTS
# Servers L Lq W Wq Pw Rho 0 1 2 3
2 0.461538 0 0.083333 0 0.076923 0.230769 0.615385 0.307692 0.076923
in the System where n =
Probabiility of n Customers
Lambda =
Mu =
k =
101
Tandem Queuing Systems
In a Tandem Queuing System a customer must visit
several different servers before service is completed.



Beverage Meats
Examples
All-You-Can-Eat restaurant
102
Beverage Meats
In a Tandem Queuing System a customer must visit
several different servers before service is completed.
Tandem Queuing Systems
Examples
All-You-Can-Eat restaurant
103
Beverage
Meats
Tandem Queuing Systems
A drive-in restaurant, where first you place your order, then pay and
receive it in the next window.
A multiple stage assembly line.
Examples
All-You-Can-Eat restaurant
In a Tandem Queuing System a customer must visit
several different servers before service is completed.
Cashiers
104
Tandem Queuing Systems
For cases in which customers arrive according to a
Poisson process and service time in each station is
exponential, .
Total Average Time in the System =
Sum of all average times at the individual stations
105
BIG BOYS SOUND, INC.
Big Boys sells audio merchandise.
The sale process is as follows:
A customer places an order with a sales person.
The customer goes to the cashier station to pay for the
order.
After paying, the customer is sent to the pickup desk to
obtain the good.
106
Data for a regular Saturday
Personnel.
8 sales persons are on the job.
3 cashiers.
2 workers in the merchandise pickup area.
Average service times.
Average time a sales person waits on a customer is 10 minutes.
Average time required for the payment process is 3 minutes.
Average time in the pickup area is 2 minutes.
Distributions.
Exponential service time at all the service stations.
Poisson arrival with a rate of 40 customers an hour.
BIG BOYS SOUND, INC.
107
What is the average amount of time, a customer
who makes a purchase spends in the store?
Only 75% of the arriving customers make a purchase!
BIG BOYS SOUND, INC.
108
BIG BOYS SOUND, INC. Solution
This is a Three Station Tandem Queuing System

Sales Clerks
M / M / 8
Cashiers
M / M / 3
Pickup desk
M / M / 2
W
1
= 14 minutes
W
2
= 3.47 minutes
W
3
= 2.67 minutes
Total = 20.14 minutes.
(.75)(40)=30