CASE PROBLEM 2 OFFICE EQIPMENT , INC - Speech or Presentation Example

Report A close analysis of the case shows that Office Equipment Inc (OEI) is overally managing to perform above average in its business of repairing and maintaining office equipment given its timely response to customer calls. Given that OEI has ten clients at the moment, it can be noted that the arrival rate of each client is between 1 to about 3 and half hours. On average the technician ought to have 30 hours of attendance to all the 10 clients given that he spends at least three hours on each.

Therefore, the service rate is determined by the number of customers he serves on a given particular time. In view of the waiting line model, OEI can predict the customer waiting time by adding the total time that is expected to be spent on each client including travelling time and service time. Basically, if it takes one hour for the technician to travel to a customer and one and half hours to fix a problem, then it would mean that he would need another hour to travel to the next customer assuming that they are within a similar distance according to the waiting line model.

So on average it is two and half hours with the first customer then another hour to travel to the next customer. Customers should expect to wait for one hour, if by chance he is the first in line or between 3 and 4 hours on average considering that the technician would move from point A to B in one hour and would need about one and half hours to fix a problem before proceeding to the next customer. Generally 4 hours is the maximum waiting time for each client assuming that the technician would need to attend to first customers in line.

OEI is satisfied that one technician can service the 10 customers without much hassles. The probability that no customer is in the system can be derived from adding the total number of hours that would be spent on each customer. Given that on average he spends 3 hours per customer, and a customer calls at least once in 50 hours of operation, then it would mean that after the technician has worked for 30 hours, there no longer would be any customer in the system given that he would have attended to all of them within one specified 50 hour time frame.

The average number of customers waiting can be derived by subtracting the number of customers that would already have been attended to from the total number of customers which is 10 within a specified time range of 50 hours considering that each client calls once during that particular time. Another method may be to subtract the total number of hours already worked by the technician from the expected total of 30 hours he would be expected to attend to all customers.The average number of the customers in the system can be derived from getting the total number of customers already attended to from the total number which is 10.

The unattended customers at that particular time would mean that it would be the total number of customers in the system. If the customer is the first one in line then he should expect to wait for an hour for the technician to arrive. If he is the second he would need to wait for an average of about four hours given that the technician would spend at least three hours with the first customer plus another hour of travelling from the first customer to the next.After arrival time, a customer can wait for about one and half hours for the machine to resume operations, which is the expected time frame to complete the job.

If the technician is already attending to another customer when the other client calls, then that customer would have to wait for about 3 hours for the technician to finish the first job then travel to the next client.Basically, the technician is expected to work 30 hours within any 50 hour time frame where the equipment would be expected to be functioning properly before calling for service. Given that he would attend to one customer for an average of 3 hours only of which there are 10 customers, the total time would be 30 hours.

Therefore the remaining 20 hours within the 50 hour time frame would mean that there is no service call.The total cost per hour would include the number of hours the technician works and travelling time. It would mean that for the 10 customers, the technician would actually work an average of about 30 hours which would be used to determine the hourly rate. Indeed if the clients remain 10, then, one technician would be able to meet the three hour service guarantee given that he has to work an average of 30 hours to service all the 10 customers in a given 50 hour time frame where service would be required.

If the number of customers grows to 20, then one technician would not be enough to service all of them. For 20 customers, the technician would be expected to work an average of 60 hours to cover all of them within a 50 hour time frame. This would mean an outstanding 10 hours which would translate into saying that about three customers would not be attended to. So, one technician would not be able to meet the demands of 20 customers. I would recommend operating with two technicians even if the number grows to 30 customers.

On average, a total of 90 hours would be required to satisfy each and every customer. It would mean that each technician would be able to work with 15 customers which would require a total of 45 hours altogether within a 50 hour time frame. This would leave each technician with a total of five free hours within a 50 hour time frame he would be expected to attend to each of the 15 customers.Instead of paying three technicians, OEI would pay only two technicians that would greatly minimize expenditure on paying for labour.

For instance the total cost of expenditure on labour for two people would be one third less compared to paying three technicians which would not strain the company’s budget. In fact it would help save the money for the company. Against this background, it would be pointless for the company to hire three technicians whilst two people can still do the same work.