Please answer step by step.
Thank you.
i) Bottleneck resource is the one that limits the overall process capacity or output.
We shall analyze how many liters of output from each resource is required for an input of 1 unit to the subsequent department.
Units of output per hour = Capacity/units required
For example,
For Department C,
Capacity = 350 liters/hour
units required = 2
Units of output per hour = 350/2 = 175 liters/hour of output
Department | Capacity (liters/hour) | Predecessors | units required | Units of output per hour |
A | 450 | - | 1 | 450 |
B | 450 | A | 1 | 450 |
C | 350 | B | 2 | 175 |
D | 250 | - | 1 | 250 |
E | 250 | - | 1 | 250 |
F | 750 | C, D, E | 3 | 250 |
G | 300 | - | 1 | 300 |
H | 950 | F, G | 4 | 237.5 |
I | 350 | - | 1 | 350 |
J | 1100 | H, I | 1 | 1100 |
K | 1400 | J | 1 | 1400 |
Because the output per hour for department C is the least i.e. 175 liters, Department C is the bottleneck.
For process capacity:
We know C is the bottleneck and can contribute to making 175 liters of input for Department F.
Now, the 3 units of F are required to make 1 unit of H.
Hence, input for H = 175 / 3 = 58.33 Liters/hour
Now, the 4 units of H are required to make 1 unit of J.
Hence, input for J = 58.33 / 4 = 14.58 Liters/hour
Hence, process capacity = 14.58 Liters/Hour
ii) Now, we can add capacity to the existing bottleneck resource until the bottleneck gets shifted to the next limiting capacity of the resource.
Here, C is the existing bottleneck, and D and E are the next limiting resources.
So, we can add capacity to C till it matches the output from D and E.
C currently generates 175 liters of output per hour for which it requires a capacity of 350 liters.
We can increase C's output to 250 liters per hour, for which it will require 250 * 2 = 500 liters per hour of capacity.
Hence, additional capacity requirement = 500 - 350 = 150 liters/hour
Now,
the revised input to F will be 250 liters/hour
Now, the 3 units of F are required to make 1 unit of H.
Hence, input for H = 250 / 3 = 83.33 Liters/hour
Now, the 4 units of H are required to make 1 unit of J.
Hence, input for J = 83.33 / 4 = 20.83 Liters/hour
Hence, revised process capacity = 16.67 Liters/Hour
The gain in process capacity = 20.83 - 14.58
The gain in process capacity = 6.25 liters/hour
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