Q-1 How long will it take you to fill a rush order?

Ans-

Activity Time required (in minutes)

Wash/Mix 6
Spoon dough onto tray 2
Oven setup 1
Bake 9
Unload/Cool 5
Pack 2
Collect payment 1
Total Throughput Time 26

So, total time for filling a rush order is 26 minutes.

Q-2 How many orders can you fill in a night, assuming you are open four hours each night?
Ans- Here, Cycle time for the system = Baking time = (Setting timer and thermostat) + (Baking
time) = (1+9) minutes = 10 minutes
Cooking production = 60/10 = 6 dozen/hour
Four hours each night = 4*60 = 240 minutes
Duration of first setup = (26-10) minutes = 16 minutes
Therefore, available time = 240-16 = 224 minutes = 3.733 hours
Orders that can be filled in a night for = 3.733*6 = 22.4 orders
So, approximately 22 orders can be filled in a night if available for 4 hours.
Q-3 How much of your own and your roommate’s valuable time will it take to fill each order?
Ans- For an order of 1 dozen:

Me:
Wash/mix 6
Spoon dough onto tray 2
My total time (in minutes) 8

Roommate:
Load 1
Pack 2
Collect payment 1
Roommate’s total time (in minutes) 4
So, a total of 8 minutes of mine and 4 minutes of my roommate will be required to fill each
order of 1 dozen.
For 2 dozen order: An additional 2 minutes will be required for spooning. Thus, making a total
of 10 minutes by me.
For my roommate, an extra 3 minutes (1 minute for loading the cookies and 2 minutes for
packaging) will be required making a total of 7 minutes.
For 3 dozen order: An extra 2 minutes will be required for me to fill the order making a total of
12 minutes.
For roommate, there will be requirement of 3 more minutes making a total of 10 minutes.
Q-4 Because your baking trays can hold exactly one dozen cookies, you will produce and sell
cookies by the dozen. Should you give any discount for people who order two dozen cookies,
three dozen cookies or more? If so, how much? Will it take you any longer to fill a two-dozen
cookies order than one–dozen cookies order?
Ans- All ingredient and box costs for every dozen are equal. The total valuable time is 6 (wash
and mix) + 2 (spoon) + 1 (set the oven timer) + 2 (packing time) + 1 (payment process) = 12
minutes. For an order of two dozen, the total time is 6 + 2 + 1 + 2 x 2 + 1 = 17 minutes. For an
order of three dozen, the total time is 6 + 2 + 1 + 2 x 3 + 1 = 22 minutes.
While 2 or 3 dozen orders save some work time (as shown above), this does not save any of the
costs. Since we don't pay for labor, we save time by making more cookies.
Since it is not reflected in the variable costs of the operation. We will still use 3 dozen cookie
materials and 3 boxes for cookie packaging. As the oven can only make a dozen cookies at a
time, we can't receive more orders to serve more customers in large quantities (2 or 3 dozen)
because we cannot prepare orders at the same time.
Q-5 How many electric mixers and baking trays will you need?
Ans- The electric mixer/food processor can produce enough dough for spooning of 3 dozen of
cookies at a time. So, we’ll need only one electric mixer. But, in a tray we can put only 1 dozen of
cookies at a time. So, we’ll need 2 more trays so that all 3 trays can be used at a time for spooning
of dough.
Q-6 Are there any changes you can make in your production plans that will allow you to make
better cookies or more cookies in less time or at lower cost? For example, is there a bottleneck
operation in your production process that you can expand cheaply? What is the effect of adding
another oven? How much would you be willing to pay to rent an additional oven?
Ans- To make cookies in less time we have to reduce the bottlenecks thus reducing the cycle
time. The bottleneck in this process of baking is 10 minutes and so the cycle time is 10 minutes.
To reduce the time, we can replace the existing oven with one that can occupy 2 or more trays
at a time for baking or we can add an additional oven.
To make cookies at a lower cost, either we can make cookies with lesser materials or we can
reduce the material cost of cookies per dozen.
Here, baking process is our bottleneck and it can be expanded by adding an additional oven.
The cycle time = 10 minutes.

If we add an additional oven, the bottleneck will be mixing and spooning process. Therefore,
the cycle time will become 8 minutes.
Thus, efficiency increases by 20%.

After adding an oven, we increased the output per hour by 1.5 tons (we initially produced 6
dozen / hour when the cycle time was 10 minutes, now we produce 7.5 dozen / hour with an 8-
minute cycle).
If we sell every dozen for $ 12. Our sales increase by $ 12*1.5 = $ 18
If we reduce the fixed cost by $ 0.70 / dozen our total profit = $ 18 - ($ 0.70 * 1.5) = $ 16.95
So, we can rent an extra oven at a price lower than $ 16.95 per hour, depending on what profit
we want.