Lec 5 - Lecture 5 09/15/10 Team 5 Sati Houston, Ashley...

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Lecture 5 Team 5 09/15/10 Sati Houston, Ashley McIntyre, Amber Richter, Michelle Vu I. Back to DMV Product Design Model Except now, we want to increase throughput from 60 customers/hr to 120 customers/hr. When combining steps 1 and 4, the new cycle time is calculated by adding the cycle times of each step respectively: 15 + 40 = 55 is the new cycle time. The capacity per hour is then calculated by dividing the amount of seconds per hour (3600) by your new cycle time (55): 3600sec onds hour 55 customers hour = 65 customers sec ond .
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Note: When facing these types of problems, you must clarify these questions: Is the objective to minimize cost? OR Is the objective to maximize customer service? You must clarify which problem you are trying to optimize in order to prevent the Bullwhip Effect , which is: The phenomenon that variability in early stages of production processes increases drastically as you move down through the chain of production events. II. Process Design
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Lec 5 - Lecture 5 09/15/10 Team 5 Sati Houston, Ashley...

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