Operations Management - Assignment Example

simulation of safety engineering, training, education process, video gaming and technology for the purposes of optimizing performance. To study simulation models computer experiments are used. At advanced level simulation is used with scientific modeling of human systems and natural systems to enable researchers to gain full insight of these human and other natural systems. In addition, simulation can be used to indicate the eventual real effects of some alternative courses and conditions of action.

This operation process is also used where real systems are not applicable since they are not accessible or they are not acceptable to be used (Greasley, 2004) There are several softwares that are used in simulation process as an operation process in companies and other institutions. These softwares are classified into two major categories open source software and proprietary software. Open source software include ASCEND, DWSIM, Sage and GNU Octave. The proprietary softwares include Arena software, AMESIM and APmonitor (Buckley, 2005) In this report the simulation software used to carry out the operation analysis of the discrete-event model is the Arena software.

Arena is a discrete event automation and simulation software that was developed by Systems Modeling and was acquired by Rockwell Automation in the Year 2000. This software uses the SIMAN processor and simulation language. In this software the user must build an experiment model through placing models that show the logic or processes. Lines are used to join or connect these modules together, as well as, showing the flow of different entities. The modules have specific actions compared to flow, entities and timing.

The precise representation of these modules and entities relative to real life objects depends on the decision of the modeler. Using this software statistical data like work in progress and cycle time levels are outputted and recorded as reports. This software is integrated with Microsoft technologies such as visual basic for applications for further automation in cases where specific algorithms are required (Altiok & Melamed, 2007). The software also supports importation of Microsoft Visio flowcharts.

Moreover, the software allows outputting to or reading from excel spreadsheets, as well as, access databases. Problem description The problems that the Arena software is used to solve in this report are problems of determining the breakeven point, total cost incurred before breakeven point, the profit earned by the company at a given units of product sold of a given company and also the determination of point of indifference in production. This report uses two case studies that are analyzed using the Arena software.

In the first case the company is considering to add a new line of production, which requires leasing new equipment for a monthly payment of ?6,000. The company’s variable costs would be ?2 per unit and they would sell for ?7 each. The company’s management needs to determine the number of units needed to be sold in order to break-even. Secondly, the company would like to determine the profit or loss it will make if 1,000 units are made and sold in a month. Thirdly, the company needs to know the number of pies it requires to sell in order to realize a profit of ?4,000. Finally, the company would like to know if it sells 2,000 units, and the profit target is ?

5,000, then what price it should