Assumptions
1. The run length is 10 hours per work day.
2. All order frequencies and processing times are exponential averages per unit.
3. The processing time and order frequency in each station are all random exponential.
4. The capacity for each station equals to the number of employees needed in each station.
5. The capacity of warehouse is 3 since there are three types of product.
Option 1: Reducing One Employee
Construction
1. There are three entities: Cold Food (source 1), Regular Product (source 2) and Bulk Product (source 3).
2. Source 1: the order frequency for Cold Food Picking is 1 per minutes. Therefore, the Interarrival Time is Random.Exponential(1). Source 2: the order frequency for Regular Product is 2 per minutes. Therefore,…show more content… According to the result from TimeInSystem, they cannot meet their new service goal of 45 minutes. Because the numbers in TimeInSystem of automation are even greater than benchmark, especially the holding time in FinalInspection, which are above 1 hour
Shortcoming and Recommendation
In terms of calculating the number of years to pay off the automation, I assume the total orders per day is stable throughout the whole year. In this circumstance, it would take them around 2 years to pay off. However, the actual number would vary. The grocery store may have a seasonal pattern. The order amount and frequency would be high in holiday season. In this situation, they may need to add employees instead of reducing. There is possibility to pay off within 2 years and there is possibility of not paying off after 2 years. Therefore, my recommendation for them don’t use automation. They can’t meet their new service goal of 45 minutes because of the longer holing time in final inspection. Instead, hiring temporary employees or full-time seasonal employees in the long
