A call center employs 1,100 agents. Every month 50 employees leave the company a
ID: 459430 • Letter: A
Question
A call center employs 1,100 agents. Every month 50 employees leave the company and 50 new employees are hired.
Suppose the cost of hiring and training a new agent is $1,000. The manager of this call center believes that increasing agents’ salaries would keep them working longer at the company. The manager wants to increase the average time that an agent works for the call center to 48 months, or four years.
Use the calculated average working time at this call center to determine the current annual cost for hiring and training.
Determine the new annual cost for hiring and training.
How much can the company save on hiring and training costs over a year?
A call center employs 1,100 agents. Every month 50 employees leave the company and 50 new employees are hired.
Explanation / Answer
A:
R = 50 people / month
I = 1100 people
Average working time = I / R = 1100 / 50 = 22 month
Current annual cost for hiring and training
Throughput Rate = 50 people / month = 600 people / year
Annual cost for hiring and training = 600 (1000 ) = $600,000
New annual cost for hiring and training
Average working time = Throughput Time = 48 months = 4 years
Throughput Rate R= I/T = 1000 people / 4 years = 250 people/year, 20.83 per month
Annual hiring and training cost is 250 (1000) = 250,000
Annual saving on hiring and training cost is $600,000-$250,000 = $ 350,000
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