IST 301 Class Exercise: Simulating Business Processes Learning Objectives: To use simulation to analyze and design business processes. To implement scenario and sensitivity analysis As-Is Process The As-Is process model for the ice cream stand is given as follows: Process Diagram Process Calendar Consider an ice cream stand with only one server as follows: Customers System Stand Role= Organizational Units=Ice cream stand Inter arrival times Assume that the stand is open from 8am to 8pm without any interruption (12-hour working day). Customers arrive at the stand at random time intervals. Based on a study, the owner assessed that the time between two consecutive customer arrivals is 8 minutes on the average. The owner did another study and found out that it takes 7 minutes on the average with a standard deviation of 30 seconds to serve a customer. Simulation Parameters for As-Is the Process: The owner wishes to calculate the following performance measurements for the stand. 1. How long does a customer wait in the line on the average? (Average waiting time in the queue) 2. On the average, how long does it take to serve a customer (cycle time=(the time that customer leaves the stand)-(the time that customer arrives at the stand)? 3. On the average, what is number of customers waiting in the line? (Average queue length) 4. What percent of the time the server is busy with serving customer and what percent of the time idle? (Resource utilization) In this exercise, we will help the owner to answer questions above using simulation.
Process 1 The simulation study showed that the As-Is process is unacceptable mainly due to long waiting lines and times. Therefore, the owner has decided to hire one more server. However, he/she wishes to learn how much improvements on the performance indicators can be achieved by hiring an additional server. Avg Max in Performance Indicators As-Is Process Process 1 Customers Inter arrival times Surprisingly, we have the same business process model. Simulation Parameters: Stand In this case, there are two servers instead of one. You can enter this information in Resource Allocation Tab of the Simulation Setup Window.
The owner wants to investigate possibility of job specialization. So, the job of serving customer is divided into two tasks, serving customers and processing payments. The owner expects that the total process times will be shorter due to specialization. The process model and estimated times are given in the following figure. Role=, Cashier Organizational Units=Ice cream stand Scenario Analysis using simulation process 2 seems to be a better alternative. However, the owner is not satisfied with the results and asks following questions: What if the customer arrival rate is increased? For example, if 12 customers arrive in an hour on the average ( 5 min inter arrival time) instead of current 7.5 customers ( 8 min inter arrival time)? Would be to-be process 2 still better? What if a bus full of customers show up at the same time (30 customers). Which alternative will perform better? Performance Indicators (5 min inter arrival time) Process 1 Avg Max in Performance Indicators (30 customers arrive at the same time) Process 1 Avg Max in
Sensitivity Analysis Using Simulation The owner is still suspicious of the results. He/She thinks that serving time of 3.0 min per customer is an optimistic estimate for the server. He/She wants to learn the serving time of the server that will make To-be process 2 worse than To-be process 1. Avg. Process % Utilization of Avg Max in Process 1 ( 3.5 min ( 4 min per customer) Process 2 ( 5 min Avg Max in As-Is Process Process 1 68.69 12.33 10.32 68.69 12.33 10.32 97% 57% 41.24/49.79 9 1 1/1 16 5 5/1 30.98 3.75 2.55/.36 Performance Indicators Increased Customer Demand (5 min inter arrival time) Process 1 22.75 16.94 22.75 16.94 84% 61.46/74.72 Avg 4 3/1 Max 15 15/1 in 8.48 6.35/.28 Performance Indicators (a bus full of customers) Process 1 54.27 13.33 54.27 13.33 99% 42.03/82.31 Avg 14 1 Max 28 4 in 44.41 4.81
% Utilization of Avg Max in Process 1 ( 3.5 min ( 4 min 12.33 11.53 14.55 22.27 12.33 11.53 14.55 22.27 To-be Process 3 ( 4 min per customer) 57% 33.85/47.39 40.85/65.85 40.62/81.89 1 1 2 2 5 7 5 8 3.75 4.48 4.51 7.58