You have just been promoted to manage the process defined by the 5 stages A to E below. After 3 months on the job you realize something is not right with process capacity because your employees experience big pile-up of work, things take too long to be processed, the opportunity for error is increasing, and the entire process is approaching chaos. Do a capacity analysis of this process. The numbers in parentheses (#) are the time in minutes to complete one unit of work. Demand in the process averages 27 units per hour and each unit must be worked on by all five stages. Administrative clerks complete Stage A and B. The assistant manager completes Stages D and E. Processing times per stage can be combined when labor is assigned two or more stages. The coding specialist takes care of Stage C.

A. How many administrative clerks should be hired assuming a target utilization for them of 90%?

B. What is the current labor utilization of the coders if two coding specialist are correctly on duty?

C. What is the total process (output) capacity in units per hour for the five-stage process A to E assuming 3 administration clerks, 2 coding specialist, and 4 assistant managers are on duty?

D. Where do any bottlenecks exist and what do you recommend to improve this process?

Diagram: Stage A (5) ---- Stage B (3) Stage C (6) Stage D (4) Stage E (4) In the diagram Stage C and D are on top of one another.