Consider a process consisting of three resources. Assume there exists unlimited

Question

Consider a process consisting of three resources. Assume there exists unlimited demand for the product. Resource 1 has a processing time of 4 minutes per unit. Resource 2 has a processing time of 5 minutes per unit. Resource 3 has a processing time of 5 minutes per unit. All three resources are staffed by one worker and each worker gets paid $10 per hour. Instruction: "Round "cost of direct labor" and "target manpower" to 2 decimal places. Round 'average labor utilization" percent and "takt time" to 2 decimal places. a. What is the cost of direct labor? per unit b. What is the labor content? minutes per unit c. How much idle time does the worker at resource 3 have per unit? minutes per unit d. What is the average labor utilization? percent e. Assume the demand rate is 15 units per hour. What is the takt time? minutes per unit f. Assume the demand rate is 15 units per hour. What is the target manpower? minutes per unit Consider a process consisting of three resources. Assume there exists unlimited demand for the product. Resource 1 has a processing time of 4 minutes per unit. Resource 2 has a processing time of 5 minutes per unit. Resource 3 has a processing time of 5 minutes per unit. All three resources are staffed by one worker and each worker gets paid $10 per hour. Instruction: "Round "cost of direct labor" and "target manpower" to 2 decimal places. Round 'average labor utilization" percent and "takt time" to 2 decimal places. a. What is the cost of direct labor? per unit b. What is the labor content? minutes per unit c. How much idle time does the worker at resource 3 have per unit? minutes per unit d. What is the average labor utilization? percent e. Assume the demand rate is 15 units per hour. What is the takt time? minutes per unit f. Assume the demand rate is 15 units per hour. What is the target manpower? minutes per unit

Explanation / Answer

a) Cost of direct labor = $ 10 *14/60 = $2.33 per hour

b) Labor content = Sum of processing times of each resource = 14 minutes per unit

c) Idle time for the worker at resource 3 = 0 minutes (cycle time = processing time)

d) Utilization of resource 1 = Processing time / Cycle time = 4/5 = 80%

For resource 2 and 3, Utilization = 100%

Avg. Utilization = 93.33% [(80+100+100) /3 ]

e) Takt time = 60 minutes / Demand = 4 minutes per unit

f) Manpower required at resource 1 = 1 (no change)

Resource 2 and 3 take 5 minutes processing time each and this has to brought down to 4 minutes, hence resource required = 5/4 = 1.25 OR 2 resources each.

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