Select a process and describe it briefly. We would select the Picking process fo

Question

Select a process and describe it briefly. We would select the Picking process for order fulfillment in a warehouse. A typical flow would be there are 3 pickers who report to duty at 900 hrs. The first batch of pick lists is printed at 915 Typically these are all orders which were either not picked previous day or ordered overnight. Now the pickers take a set of 5 pick lists and go to the shelves with a forklift and pick all items into the 5 baskets meant for the 5 orders. Once all the orders are picked completely they come and drop the 5 baskets at the packing stations. This completes the picking process. Estimate the capacity of this process. The capacity of this process is as follows. A worker works for 9 hours a day minus 1 hour for his lunch, tea breaks thus the effective hours is 8 per worker per day. Next on an average (long term average) it takes 15 min to pick an order completely and thus each worker can complete 8r60/15 32 orders in a day Since we have only 3 forklifts in our warehouse, w can have only 3 pickers in any shift and we operate just one shift every day, we find that the picking process capacity is 323-96 orders a day Would you use input or output measures to measure capacity. Yes we use output measures that is picks completed (output parameter) and not the picklist generated (input parameter) as a measure to evaluate the process capacity How does capacity compare relative to the demand- Adequate, High, Low The capacity for the process is adequate given the size of our business and an average flowof approx 100 orders a day For this process what would be some reasons to maintain capacity cushion Although currently we do not maintain a capacity cushion, but during peak sales season (Christmas), we do hire a forklift for a few months and the operator as temp labour. This is done to ensure that all the orders are picked everyday and shipped across. Typically we see 30-40% increase in order during Christmas sales and thus maintain 1 additional forklift. If not done, we would have a backlog of orders every day and it would keep piling up since the rate of input is more than the rate of output. This will lead to lot of order cancellation and business loss. Advantages and disadvantages of holding a large versus small capacity cushion dvantages 1. Buffer capacity for peak needs 2. Buffer capacity for any untoward incident like absenteeism, machine breakdown etc isadvantages 1. 2. 3. Additional direct costs to maintain buffer Additional overheads in the form of space, manpower, management bandwidth to manage the buffer Small buffer might lead to incomplete fulfillment of orders during any surge

Explanation / Answer

Capacity Cushion:

As we have already calculated that each order requires 15 min to pick, therefore a single worker with one forklift will pick:

(8 X 60)/15 = 32 orders per day. ( Number of minutes in a day/ number of minutes to pick one order)

Right now, they have an average of 100 orders per day, which can bem met by 3 persons with 3 forklifts ( 3*32= 96)

If they want to build some capacity cushion and add another person( with forklift), their capacity will become (4*32= 128 orders per day)

128 orders per day is approximately 28% capacity cushion over normal demand.

Capacity cushion: (Augmented capacity- required capacity)*100/required capacity ( (128-100)*100/100 = 28%)

The passage says capacity is adequate and averages around 100 prders per day. Please understand these are averages NOT a fixed number every day. With an average capacity of 96 orders per day, it seems adequate to serve.

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