Rx’s R Us is a mail order dealer of homeopathic medications. It has 6 phone lines for receiving orders. Order takers answer the phones, check that inventory is available, and then prepare “picking tickets” for the warehouse stock pickers. One order may consist of several lines, with a different medication or multiples of medications ordered on each line. Each order taker can prepare picking tickets at a rate of one line every three minutes. The telephones are normally answered from 6 am to 4 pm Pacific Time. Stock pickers can fill and package the meds at a rate of one line every five minutes. RX employs 8 stock pickers who normally work weekdays from 8 am to 5 pm (except for one lunch hour).
a. What is the effective capacity of order taking (in lines per week) vs. stock pickers?
b. The eight warehouse employees work 10 hours per day between 7 am and 6 pm, 6 days a week for 3 weeks after the fall catalog is mailed in October. What is the peak capacity of the system, in lines per week? [State whatever assumptions you make in order to generate your response.]
c. During the second week of October, Parts R Us filled 5,000 order lines. What is the utilization as a percent of effective capacity vs. peak capacity?