Level is limited to overtime, undertime, and vacation schedules.

Key Terms

Aggregate Plan
-​ Another term for the sales and operations plan.
From slides
Aggregations at Level 1: Sales and operations planning:
-​ Aggregations by services or products family
-​ A group of customers, service or products that have similar market demand
requirements and common process, labor, and materials requirements
-​ Use of relatively broad families, avoid too much detail at this stage of planning.
-​ Aggregation by workforce
-​ Management can aggregate employees along product family lines by splitting the
workforce into subgroups and assigning a different group to the production of
each product family
-​ In service operations, such as city government, workers are aggregated by the
type of service they provide: firefighters, police officers, sanitation workers, and
administration
-​ Aggregation by time
-​ Planning horizon ranges from 3 to 18 months, typically one year
-​ Adjustments usually are made monthly or quarterly
Backorder and stockout
-​ Additional costs to expedite past-due orders, the costs of lost sales, and the potential cost
of losing a customer to a competitor (sometimes called loss of goodwill).

Chase strategy
-​ involves hiring and laying off employees to match the demand forecast over the planning
horizon. Varying the workforce’s regular-time capacity to equate supply to demand
requires no inventory investment, overtime, or undertime. The drawbacks are the expense
of continually adjusting workforce levels, the potential alienation of the workforce, and
the loss of productivity and quality because of constant changes in the workforce.
- is limited to just hiring and laying off employees.
From Slides
-​ A strategy that involves hiring and laying off employees to match the demand forecast
-​ Requires no inventory investment, overtime, or undertime
-​ The drawbacks are the expensive of continually adjusting workforce levels, the potential
alienation of the workforce, and the possible loss of productivity and quality because of
constant changes in workforce.
Earliest due date (EDD)
-​ is the next one to be processed. The due date specifies when work on a job should be
finished. Due dates are commonly used by manufacturers and suppliers in the supply
chain. For example, a product cannot be assembled until all of its purchased and
produced components are available. If these components were not already in inventory,
they must be ordered prior to when the product assembly can begin. Their due date is the
start date for assembling the product to be assembled. This simple relationship is
fundamental to coordinating with suppliers and with the manufacturer’s own shops in the
supply chain. It is also the key to expediting, which is the process of completing a job
sooner than would otherwise be done. Expediting can be done by revising the due date,
moving the job to the front of the waiting line, making a special appeal to the supplier,
adding extra capacity, or even putting a red tag on the job that says the job is urgent.

First-come, first-served (FCFS)

-​ The job arriving at the workstation first has the highest priority under a first-come,
first-served (FCFS) rule. This rule is “fair” in that each job is treated equally, with no
one stepping ahead of others already in line. It is commonly used at service facilities and
is the rule that was assumed in Supplement B, “Waiting Lines.”

Fixed schedule
-​ calls for each employee to work the same days and hours each week.
-​ Flow time - the amount of time a job spends in the service or manufacturing system. It is
the sum of the waiting time for servers or machines; the process time, including setups;
the time spent moving between operations; and delays resulting from machine
breakdowns, unavailability of facilitating goods or components, and the like. Flow time is
sometimes referred to as throughput time or time spent in the system, including service.
For a set of jobs to be processed at a single workstation, a job’s flow time is
-​ Flow time = finish time + time since job arrived at the workstation
-​ When using this equation, we assume for convenience that the first job scheduled starts at
time zero (0). At time 0, all the jobs were available for processing at the workstation

Hiring and layoff cost

-​ Costs of advertising jobs, interviews, training programs for new employees, scrap caused
by the inexperience of new employees, loss of productivity, and initial paperwork. Layoff
 costs include the costs of exit interviews, severance pay, retaining and retraining
remaining workers and managers, and lost productivity.

Level strategy
-​ involves keeping the workforce constant (except possibly at the beginning of the planning
horizon). It can vary its utilization to match the demand forecast via overtime, undertime
(paid or unpaid), and vacation planning (i.e., paid vacations when demand is low). A
constant workforce can be sized at many levels: Managers can choose to maintain a large
workforce so as to minimize the planned use of overtime during peak periods (which,
unfortunately, also maximizes the need for undertime during slack periods). Alternatively,
they can choose to maintain a smaller workforce and rely heavily on overtime during the
peak periods (which places a strain on the workforce and endangers quality).
-​ Level is limited to overtime, undertime, and vacation schedules.
From slides
-​ A strategy that keeps the workforce constant, but varies its utilization via overtime,
undertime, and vacation planning to match the demand forecast

Mixed strategy
-​ best strategy; considers the full range of supply options. ​brings into play all options,
including anticipation inventory, part-time workers, subcontractors, backorders, and
stockouts.
From Slides
-​ A strategy that considers the advantages of the “pure” chase and level strategies
Operations planning and scheduling
-​ is the process of making sure that demand and supply plans are in balance, from the
aggregate level down to the short-term scheduling level. Operations planning and
scheduling lies at the core of supply chain integration, around which plans are made up
and down the supply chain, from supplier deliveries to customer due dates and services.
Why is it so important? First, it requires managerial inputs from all of the firm’s
functions. Marketing provides inputs on demand and accounting provides important cost
data and a firm’s financial condition. Second, each function is affected by the plan. A
plan that calls for expanding the workforce has a direct impact on the hiring and training
requirements for the human resources function. As the plan is implemented, it creates
revenue and cost streams that finance must deal with as it manages the firm’s cash flows.
Third, each department and group in a firm has its own workforce. Managers of these
departments must make choices on hiring, overtime, and vacations. Finally, whether the
business is an airline, hotel, computer manufacturer, or a university, schedules are a part
of everyday life. Schedules involve an enormous amount of detail and affect every
process in a firm. For example, service, product, and employee schedules determine
specific cash flow requirements, trigger the firm’s billing process, and initiate
 requirements for the employee training process. Firms use the scheduling process to
lower their costs and improve their responsiveness, affecting operations up and down the
supply chain worldwide.
From Slides
-​ The process of balancing supply with demand, from the aggregated level down to the
short-term scheduling level
-​ Sales and operations planning (S&OP)
-​ Scheduling
-​ Requires managerial inputs from all functions
-​ Marketing provides inputs demand and customer requirements
-​ Accounting provides cost data and the firm’s financial condition
-​ Each function is affected by the plan

Overtime
-​ means that employees work longer than the regular workday or workweek and receive
additional pay for the extra hours. It can be used to satisfy output requirements that
cannot be completed on regular time. Overtime is expensive (typically 150 percent of the
regular-time pay rate), and workers often do not want to work overtime for an extended
period. Excessive overtime also can result in declining quality and productivity. However,
it helps avoid the costly fringe benefits (such as health insurance, dental care, Social
Security, retirement funds, paid vacations, and holidays) that come with hiring a new
full-time employee.

Overtime costs
-​ Wages paid for work beyond the normal workweek, typically 150 percent of regular-time
wages (sometimes up to 200 percent for Sundays and holidays), exclusive of fringe
benefits. Overtime can help avoid the extra cost of fringe benefits that come with hiring
another full-time employee.

Past due
-​ can be expressed as the amount of time by which a job missed its due date (also referred
to as tardiness) or as the percentage of total jobs processed over some period of time that
missed their due dates. Minimizing these past due measures supports the competitive
priorities of cost (penalties for missing due dates), quality (perceptions of poor service),
and time (on-time delivery).

Priority sequencing rules

 -​ One way to determine what job to process next

Production family
-​ Services or Products. A group of customers, services, or products that have similar
demand requirements and common process, workforce, and materials requirements
-​ Sometimes, product families relate to market groupings or to specific processes. A firm
can aggregate its services or products into a set of relatively broad families, avoiding too
much detail at this stage of the planning process. For instance, a manufacturer of bicycles
that produces different models of bikes might divide them into two groups, mountain
12

bikes and road bikes, for the purpose of preparing the sales and operations plan. Common
and relevant measurements should be used.

Regular time cost

-​ Regular-time wages paid to employees plus contributions to benefits, such as health
insurance, dental care, Social Security, retirement funds, and pay for vacations, holidays,
and certain other types of absences.

Resource plan
-​ An intermediate step in the planning process that lies between S&OP and scheduling. It
determines requirements for materials and other resources on a more detailed level than
the S&OP. It is covered in the next chapter.
From Slides
Level 2 resource planning
-​ Determine the firm’s workforce schedules and other resource requirements
-​ Resource planning for manufacturing firms
-​ Master production schedule (MPS)
-​ Materials requirements planning (MRP)
-​ Resource planning for services
-​ Daily or weekly capacity requirements for facility or labor

Sales and operations plan (S&OP)

-​ A plan of future aggregate resource levels so that supply is in balance with demand. It
states a company’s or department’s production rates, workforce levels, and inventory
holdings that are consistent with demand forecasts and capacity constraints. The S&OP is
a time-phased plan, meaning that it is projected for several time periods (such as months
or quarters) into the future.

Schedule
-​ A detailed plan that allocates resources over shorter time horizons to accomplish specific
tasks
From Slides
-​ The lowest planning level
-​ Put together day-to-day schedules for individual employees and customers
-​ It takes the resource plan and translates it into specific operational tasks on a detailed
basis
-​ E.g.., Facility schedules, workforce schedules, and the sequence of jobs on bottleneck
machines

Shortest processing time (SPT)

-​ A priority sequencing rule that specifies that the job requiring the shortest processing
time is the next job to be processed.

Staffing Plan
-​ A sales and operations plan for a service firm which centers on staffing and other human
resource-related factos

Supply options
-​ Anticipation Inventory. Anticipation inventory can be used to absorb uneven rates of
demand or supply. For example, a plant facing seasonal demand can stock anticipation
inventory during light demand periods and use it during heavy demand periods.
Manufacturers of air conditioners, such as Whirlpool, can experience percent of their
90

annual demand during just months of a year. Extra, or anticipation inventory, also can
3

help when supply, rather than demand, is uneven. For example, a company can stock up
on a certain purchased item if the company’s suppliers expect severe capacity limitations.
Despite its advantages, anticipation inventory can be costly to hold, particularly if
stocked in its finished state. Moreover, when services or products are customized,
anticipation inventory is not usually an option. Service providers in the supply chain
generally cannot use anticipation inventory because services cannot be stocked.
-​ Workforce Adjustment. Management can adjust workforce levels by hiring or laying off
employees. The use of this alternative can be attractive if the workforce is largely
unskilled or semiskilled and the labor pool is large. These conditions are more likely
found in some countries than in others. However, for a particular company, the size of the
qualified labor pool may limit the number of new employees that can be hired at any one
time. Also, new employees must be trained, and the capacity of the training facilities
themselves might limit the number of new hires at any one time. In some industries,
laying off employees is difficult or unusual for contractual reasons (unions); in other
industries, such as tourism and agriculture, seasonal layoffs and hirings are the norm.
Downsizing can also be accomplished by attrition of the workforce, as we have seen in
the Bank of America opener to this chapter.
 -​ Workforce Utilization. An alternative to a workforce adjustment is a change in workforce
utilization involving overtime and undertime. Overtime means that employees work
longer than the regular workday or workweek and receive additional pay for the extra
hours. It can be used to satisfy output requirements that cannot be completed on regular
time. Overtime is expensive (typically percent of the regular-time pay rate), and workers
150

often do not want to work overtime for an extended period. Excessive overtime also can
result in declining quality and productivity. However, it helps avoid the costly fringe
benefits (such as health insurance, dental care, Social Security, retirement funds, paid
vacations, and holidays) that come with hiring a new full-time employee. Undertime
means that employees do not have enough work for the regular-time workday or
workweek. For example, they cannot be fully utilized for hours per day or for days per
8 5

week. Undertime occurs when labor capacity exceeds demand requirements (net of
anticipation inventory), and this excess capacity cannot or should not be used
productively to build up inventory or to satisfy customer orders earlier than the delivery
dates already promised.

-​ Part-Time Workers. Another option apart from undertime is to hire part-time workers,
who are paid only for the hours and days worked. Perhaps they work only during the
peak times of the day or peak days of the week. Sometimes, part-time arrangements
provide predictable work schedules, but in other cases workers are not called in if the
workload is light. Such arrangements are more common in low-skill positions or when
the supply of workers seeking such an arrangement is sufficient. Part-time workers
typically do not receive fringe benefits
-​ Subcontractors can be used to overcome short-term capacity shortages, such as during
peaks of the season or business cycle. Subcontractors can supply services, make
components and subassemblies, or even assemble an entire product..
-​ Vacation Schedules. A manufacturer can shut down during an annual lull in sales,
leaving a skeleton crew to cover operations and perform maintenance. Hospital
employees might be encouraged to take all or part of their allowed vacation time during
slack periods. The use of this alternative depends on whether the employer can mandate
the vacation schedules of its employees. In any case, employees may be strongly
discouraged from taking vacations during peak periods or encouraged to take vacations
during slack periods.

Textbook
Scheduling
-​ Scheduling is the last step in Figure 11.2. It takes the operations and scheduling process
from planning to execution, and is where the “rubber meets the road.”
-​ This important aspect of supply chain management is itself a process.
 -​ It requires gathering data from sources such as demand forecasts or specific customer
orders, resource availability from the sales and operations plan, due dates for resource or
material requirements from resource planning activities, and specific constraints to be
reckoned with from employees and customers.
-​ It then involves generating a schedule for the supply of resources or materials to meet the
needs determined in resource planning.
-​ Good scheduling can support a firm’s competitive priorities, while poor scheduling can
be devastating

Job and facility scheduling

-​ For different jobs or activities, schedules can simply list the job due dates, show in a table
their start and finish times, or show in a graph their start and finish times.

SLIDES
S&OP Strategies
Slides
Chase Strategy
-​ A strategy that involves hiring and laying off employees to match the demand forecast
-​ Requires no inventory investment, overtime, or undertime
-​ The drawbacks are the expense of continually adjusting workforce levels, the potential
alienation of the workforce levels, and the possible loss of productivity and quality
because of constant changes in workforce

Level Strategy
-​ A strategy that keeps the workforce constant, but varies its utilization via overtime,
undertime, and vacation planning to match the demand forecast

Mixed Strategy
-​ A strategy that considers the advantages of the “pure” chase and level strategies

Regular time
-​ Regular-time wages paid to employees plus contributions to benefits, such as health
insurance, dental care, Social Security, retirement funds, and pay for vacations, holidays,
and certain other types of absences.

Overtime
-​ Wages paid for work beyond the normal workweek, typically 150 percent of regular-time
wages (sometimes up to 200 percent for Sundays and holidays), exclusive of fringe
benefits. Overtime can help avoid the extra cost of fringe benefits that come with hiring
another full-time employee.
Hiring and layoffs
-​ Costs of advertising jobs, interviews, training programs for new employees, scrap caused
by the inexperience of new employees, loss of productivity, and initial paperwork. Layoff
costs include the costs of exit interviews, severance pay, retaining and retraining
remaining workers and managers, and lost productivity.

Inventory holding
-​ Costs that vary with the level of inventory investment: the costs of capital tied up in
inventory, variable storage and warehousing costs, pilferage and obsolescence costs,
insurance costs, and taxes.

Backorder and stockout

-​ Additional costs to expedite past-due orders, the costs of lost sales, and the potential cost
of losing a customer to a competitor (sometimes called loss of goodwill).

Anticipation Inventory
-​ Used to absorb uneven rates of demand or supply

Workforce adjustment
-​ Adjust workforce levels by hiring or laying off employees

Workforce utilization
-​ Overtime - employees work larger than the regular workday or workweek and receive
additional pay for the extra hours
-​ Undertime - employees do not have enough work for the regular-time workday or
workweek

Part-time workers
-​ Who are paid only for the hours and days worked

Subcontractors
-​ Used to overcome short-term capacity shortages, such as during peaks of the season or
business cycle

Vacation schedules
-​ Shut down operations during slow seasons, leaving a skeleton crew to cover operations
and perform maintenance
Workforce Scheduling
Scheduling
-​ The function that takes the operations and scheduling process from planning to execution
-​ Scheduling is the last step. It takes the operation and scheduling process from planning to
execution, and where the “rubber meets the road”

Workforce scheduling
-​ Translate the staffing plan into specific schedules of work for each employees

Constraints
-​ Technical constraints
-​ Legal and behavioral considerations
-​ Psychological needs of workers

Scheduling options
-​ Rotating schedule - each person has the same opportunity to have weekends and holidays
off and to workdays, as well as evenings and nights
-​ Fixed schedule - each employee to work the same days and hours of the week

Priority sequencing measures

-​ First-come, first-served (FCFS)
-​ Earliest due date (EDD)
-​ Shortest processing time (SPT)

Performance measures
-​ Flow time
-​ Flow time = finish time + time since job arrived at workstation
-​ Past Due (tardiness)
The Barberton Municipal division of Road Maintenance is charged with road repair in the city of
Barberton and the surrounding area. Vijay​Gupta, road maintenance​director, must submit a
staffing plan for the next year based on a set schedule for repairs and on the city budget. Gupta
estimates that the labor hours required for the next four quarters are 7,000​, 12,500​, 19,000​, and
9,000​, respectively. Each of the 11 workers on the workforce can contribute 500 hours per
quarter. Payroll costs are $ 6,000 in wages per worker for regular time worked up to 500 ​hours,
with an overtime pay rate of $ 19 for each overtime hour. Overtime is limited to 20 percent of the​
regular-time capacity in any quarter. Although unused overtime capacity has no​cost, unused
regular time is paid at $ 12 per hour. The cost of hiring a worker is $ 3,200​, and the cost of laying
off a worker is $ 1,200. Subcontracting is not permitted. ​(Hint: When calculating the number of​
workers, make sure to round up to the next whole number before proceeding with any further​
calculations.) Part 2 a. Find a level workforce plan that relies just on overtime and the minimum
amount of undertime possible. Overtime can be used to its limits in any quarter.

What is the total cost of the​plan? ​$___enter your response here. ​(Enter your response as an​
integer.)

Level workforce chosen: 32 workers (must be an integer and large enough so overtime can
cover peak demand).​
Reason: 32 workers → regular capacity per quarter = 32×500 = 16,000 hours; overtime capacity
per quarter = 20%×16,000 = 3,200 hours, so the 19,000-hour peak can be met using 3,000 hours
overtime in Q3.

Costs (quarterly & one-time):

Regular wages (paid regardless of actual regular usage): 32 workers × $6,000 × 4 quarters =
$768,000​
Overtime used: only Q3 needs overtime = 19,000 − 16,000 = 3,000 hours → 3,000 × $19 =
$57,000​
Hiring (start with 11 workers → hire 21 workers): 21 × $3,200 = $67,200​
No layoff cost.

Total cost = 768,000 + 57,000 + 67,200 = $892,200.

Answer (integer): 892200

How many undertime hours does it call​for? ___ hours. ​(Enter your response as an​integer.)

Total undertime = 19,500 hours.

Breakdown:

Q1: 16,000 − 7,000 = 9,000​

Q2: 16,000 − 12,500 = 3,500​
Q3: 16,000 − 19,000 → 0 (overtime covers the 3,000 shortfall)​
Q4: 16,000 − 9,000 = 7,000​
Sum = 9,000 + 3,500 + 0 + 7,000 = 19,500.​

The Barberton Municipal division of Road Maintenance is charged with road repair in the city of
Barberton and the surrounding area. Vijay​Gupta, road maintenance​director, must submit a
staffing plan for the next year based on a set schedule for repairs and on the city budget. Gupta
estimates that the labor hours required for the next four quarters are 6,500​, 12,000​, 20,000​, and
9,500​, respectively. Each of the 11 workers on the workforce can contribute 500 hours per
quarter. Payroll costs are $ 6,000 in wages per worker for regular time worked up to 500 ​hours,
with an overtime pay rate of $ 18 for each overtime hour. Overtime is limited to 20 percent of the​
regular-time capacity in any quarter. Although unused overtime capacity has no​cost, unused
regular time is paid at $ 12 per hour. The cost of hiring a worker is $ 4,000​, and the cost of laying
off a worker is $ 1,200. Subcontracting is not permitted. ​(Hint: When calculating the number of​
workers, make sure to round up to the next whole number before proceeding with any further​
calculations.) Part 2 a. Find a level workforce plan that relies just on overtime and the minimum
amount of undertime possible. Overtime can be used to its limits in any quarter.
What is the total cost of the​plan? ​$ enter your response here. ​(Enter your response as an​
integer.)

Level workforce = 34 workers (because ⌈20000/(500+100)⌉=⌈33.33⌉=34

Costs:

Regular wages (annual) = 34 x $6,000 x 4 = $816,000

Overtime hours used: Q1 0, Q2 0, Q3 3,000 Q4 0 -> OT costs = 3,000 x $18 = $54,000

Hiring (start with 11 workers -> hire 23) = 23 x $4,000 = $92,000

Total cost = $816,000 + $54,000 + $92,000 = $962,000

How many undertime hours does it call​for? enter your response here hours. ​(Enter your
response as an​integer.)

1.​ Choose a level workforce WWW.​

-​ Each worker: 500 regular hours/quarter.​

-​ Overtime limit = 20% of regular capacity =

0.20×500=1000.20\times500=1000.20×500=100 hours/worker/quarter.​

-​ So total possible hours/quarter per worker = 500+100=600500+100=600500+100=600.​

-​ To meet the peak demand (Q3 = 20,000 hours) using overtime to its limit:​

2, regular time capacity per quarter for 34 workers:

Regular capacity = 34 x 500 = 17000 hours/ workers

Overtime capacity per quarter

OT capacity = 34 x 100 = 3400 hours/ workers

3. Quarter by quarter usage and underline

Q1 demand = 6,500.​
Regular used = 6,500 (since demand < regular cap).​
Undertime = 17,000 -6,500 = 10,500​
OT used = 0.​

Q2 demand = 12,000.​
Undertime = 17,000 - 12,000 = 5,000
OT used = 0.​

Q3 demand = 20,000.​
Regular used = 17,000 (full regular capacity).​
Remaining demand = 20,000 - 17,000 = 3,000 -> OT used = 3,000 (within OT cap 3,400)
Undertime = 0.​

Q4 demand = 9,500.​
Undertime =17,000 - 9,500 = 7,500​
OT used = 0.

4. Total undertime (sum up of all quarters): 10,500 +5,000+0+7,500= 23,000 hours

Use a chase strategy that varies the workforce level without using overtime or undertime. What
is the total cost of this​plan? ​$___ enter your response here. ​(Enter your response as an​integer.)

total cost = $717,200

Breakdown:

Workers required each quarter (ceil demand/500): Q1=13, Q2=24, Q3=40, Q4=19​
Regular wages = (13+24+40+19) × $6,000 = $576,000​
Hires = 29 × $4,000 = $116,000​
Layoffs = 21 × $1,200 = $25,200​
Total = $576,000 + $116,000 + $25,200 = $717,200.

Quarter Demand (hrs) Divide by 500 Round up (Ceiling) Workers Needed

1 6,500 6,500 ÷ 500 = 13.0 13 13

2 12,000 12,000 ÷ 500 = 24.0 24 24

3 20,000 20,000 ÷ 500 = 40.0 40 40

4 9,500 9,500 ÷ 500 = 19.0 19 19

Consider the following proposed​plan, for a different demand​schedule, that combines the
strategy of​hiring, layoffs, and utilizing overtime. Payroll costs are $ 6,000 in wages per worker
for regular time​worked, with an overtime pay rate of $ 18 for each overtime hour.

The cost of hiring a worker is $ 4,000​, and the cost of laying off a worker is $ 1,200.

quarter demand hours workforce hires layoffs overtime hours

1 6,500 12 1

2 12,000 24 12

3 19,000 31 7 3,500

4 9,000 18 13

$668,600

Breakdown:

●​ Regular wages = 85×$6,000=$510,000

●​ Overtime = 3,500×$18=$63,000
●​ Hiring = 20×$4,000=$80,000
●​ Layoffs = 13×$1,200=$15,600

Total = $510,000 + $63,000 + $80,000 + $15,600 = $668,600.

Bob​Carlton's golf camp estimates the following workforce requirements for its services over the
next two​years: quarters: 1 2 3 4 5 6 7 8 demand(hrs) 4,300 6,400 3,100 4,800 4,500 6,400 3,700
5,000 Each certified instructor puts in 480 hours per quarter regular time and can work an
additional 120 hours overtime.​Regular-time wages and benefits cost Carlton $ 7,200 per
employee per quarter for regular time worked up to 480 ​hours, with an overtime cost of $ 20 per
hour. Unused regular time for certified instructors is paid at $ 15 per hour. There is no cost for
unused overtime capacity. The cost of​hiring, training, and certifying a new employee is $
10,000. Layoff costs are $ 4,000 per employee. Currently 8 employees work in this capacity. Part
2 a. Find a workforce plan using the level strategy that allows for no delay in service. It should
rely only on overtime and the minimum amount of undertime necessary. What is the total cost of
the​plan? ​$ enter your response here. ​(Enter your response as an​integer.)

Nice — I’ll show the full math.

Step 1 — choose level workforce​

Peak demand = 6,400 hours (quarters 2 & 6).​
Each instructor max = 480 regular + 120 OT = 600 hours/quarter.​
Required instructors = ceil(6400 / 600) = ceil(10.6667) = 11 instructors.

Step 2 — capacities for 11 instructors​

Regular capacity per quarter = 11 × 480 = 5,280 hours.​
OT capacity per quarter = 11 × 120 = 1,320 hours.

Step 3 — quarter-by-quarter overtime needed (demand − regular capacity, floored at 0, capped

by OT capacity)

Quarter Demand Regular cap 5,280 OT needed

1 4,300 4,300 used (no OT) 0

2 6,400 5,280 used → remainder 1,120 1,120

3 3,100 3,100 used 0

4 4,800 4,800 used 0

5 4,500 4,500 used 0

6 6,400 5,280 used → remainder 1,120 1,120

7 3,700 3,700 used 0

8 5,000 5,000 used 0

Total overtime = 1,120 + 1,120 = 2,240 hours.

Step 4 — costs

●​ Regular wages per quarter = 11 instructors × $7,200 = $79,200.​

For 8 quarters: $79,200 × 8 = $633,600.​

●​ Overtime cost = 2,240 hrs × $20/hr = $44,800.​

●​ Hiring: start with 8 instructors, need 11 → hire 3 × $10,000 = $30,000.​

●​ Layoffs = 0.​

Total cost = 633,600 + 44,800 + 30,000 = $708,400.

Answer: 708400

Use a chase strategy that varies the workforce level without using overtime or undertime. What
is the total cost of this​plan? ​$ enter your response here. ​(Enter your response as an​integer.)

Total cost = $809,600

Breakdown

●​ Workforce each quarter (ceil demand/480): 9, 14, 7, 10, 10, 14, 8, 11​

●​ Total wages = ( (9+14+7+10+10+14+8+11)\times $7{,}200 = $597{,}600)​

●​ Hires = 16 → (16\times$10{,}000 = $160{,}000)​

●​ Layoffs = 13 → (13\times$4{,}000 = $52{,}000)​

Sum = $597,600 + $160,000 + $52,000 = $809,600.

Consider the following proposed plan for a different demand scenario. In this​case, each certified
instructor puts in 480 hours per quarter regular time. All other cost and capacity values are the same as
above.
Quarter demand hours workforce hires layoffs overtime hours

1 4,200 9 1

2 6,400 11 2 1,120

3 3,000 9 2

4 4,800 9 480

5 4,400 9 80

6 6,240 11 2 960

7 3,600 9 2

8 4,800 9 480

Total 76 5 4 3,120

Total cost = regular wages + overtime + hiring + layoff.

●​ Regular wages = (76\times$7{,}200=$547{,}200)​

●​ Overtime = (3{,}120\times$20=$62{,}400)​

●​ Hiring = (5\times$10{,}000=$50{,}000)​

●​ Layoffs = (4\times$4{,}000=$16{,}000)​

Total = $547,200 + $62,400 + $50,000 + $16,000 = $675,600.

Answer: 675600

The Mowry Machine Shop still has five jobs to be processed as of 8 A.M. today​(day25 ​) at its bottleneck
operation. The time since the order​arrived, processing​time, and promised due dates are given in the
following table. The jobs are listed in the order of arrival.

Job Job since order arrived (days ago) processing time (days) due date (days from now)
A 12 8 11
B 10 4 17
C 8 4 14
D 3 3 28
E 1 10 20
Develop separate schedules by using the FCFS and EDD rules. Compare the schedules on the basis of
average flow time and average days past due.
Part 2

Using the FCFS​(first come, first​served) decision rule for sequencing the​jobs, the order​is:
Sequence 1 2 3 4 5
Job a b c d e

Using the EDD​(earliest due​date) decision rule for sequencing the​jobs, the order is​(to resolve a​tie, use
the order in which the jobs were​received):

Sequence 1 2 3 4 5
Job A C B E D

The average flow time and average days past due for each option​are: ​(Enter your responses rounded to
one decimal​place.)

Let’s compute everything carefully step-by-step.

Given data
Job Days since arrival Processing time Due date (days from now)

A 12 8 11

B 10 4 17

C 8 4 14

D 3 3 28

E 1 10 20

FCFS (First Come, First Served)

Order: A → B → C → D → E

Job Proc. Time Completion (days from now) Flow time Days past due

A 8 8 12 + 8 = 20 max(8−11, 0)=0

B 4 8 + 4 = 12 10 + 12 = 22 12−17=neg→0

C 4 12 + 4 = 16 8 + 16 = 24 16−14=2

D 3 16 + 3 = 19 3 + 19 = 22 19−28=0

E 10 19 + 10 = 29 1 + 29 = 30 29−20=9

Average flow time:​

[​
(20 + 22 + 24 + 22 + 30)/5 = 118/5 = 23.6​
]

Average days past due:​

[​
(0 + 0 + 2 + 0 + 9)/5 = 11/5 = 2.2​
]

✅ FCFS → Average flow time = 23.6 days, Average days past due = 2.2 days

2️⃣ EDD (Earliest Due Date)

Order: A → C → B → E → D

Job Proc. Time Completion (days from now) Flow time Days past due

A 8 8 12 + 8 = 20 8−11=0

C 4 8 + 4 = 12 8 + 12 = 20 12−14=0

B 4 12 + 4 = 16 10 + 16 = 26 16−17=0

E 10 16 + 10 = 26 1 + 26 = 27 26−20=6

D 3 26 + 3 = 29 3 + 29 = 32 29−28=1

Average flow time:​

[ (20 + 20 + 26 + 27 + 32)/5 = 125/5 = 25.0 ]

Average days past due:​

[ (0 + 0 + 0 + 6 + 1)/5 = 7/5 = 1.4 ]
✅ EDD → Average flow time = 25.0 days, Average days past due = 1.4 days

Final Answers
Rule Average Flow Time Average Days Past Due

EDD 25.0 1.4

FCFS 23.6 2.2