The bottleneck in the process, which is the time required to bake the cookies, will need to change (decrease) in order to fulfill a demand of 25 dozen cookies per night. Currently, Kristen and her roommate have one oven which can bake one dozen (one tray) cookies in 10 minutes. If Kristen and her roommate were to purchase a second oven, this 10 minute bottleneck in the process could potentially be reduced to a 5 minute process task. This would make the mixing of ingredients the bottleneck, which is a 6 minute task.
Due to the bottleneck shifting to another shorter task due to the original bottleneck’s task time decreasing, the max rate of production will also increase as shown below: d) 30 dozen per night? The answer is the same as part c. e) 35 dozen per night? The answer is the same as part c. iv) It is midway through the first night of business with a setup as described in the case. A rush order comes in that wants the cookies in 30 minutes. Do you accept the order? Yes or no.
Explain how you decided. Assuming Kristen and her roommate are working on a previous order when the rush order is received, the rush order would only be accepted if it had been received at 11 minutes into the order prior to the rush order and 24 minutes into the order prior to the rush order. This is shown visually below: Figure 3: Resource Utilization For Rush Order Received 11 Minutes Into Prior Order Figure 4: Resource Utilization For Rush Order Received 24 Minutes Into Prior Order
These diagrams show that as long as the rush order is received between these times in the prior orders workflow, there will be no resource conflicts and the rush order can be successfully completed. If the rush-order was received prior to that stretch of time, there will be resource conflicts or extended wait-times as shown in the figures below: Figure 5: Resource Conflict For Rush Order Received Earlier Than 11 Minutes Into Prior Order Figure 6: Resource Conflict For Rush Order Received Later Than 24 Minutes Into Prior Order
In order to mitigate the resource conflicts caused by accepting an order earlier than 11 minutes or later than 24 minutes into the previous order, wait times would need to be introduced in order to allow the resource to complete a task for one order and then perform the task for the rush order. This would introduce inefficiency into the process and most likely impact receipt of future orders. v) We need to consider business strategy: will the process capacity be higher if Kristen offers only non-customized cookies of one type? What are the advantages and disadvantages of this alternative strategy compared to what Kristen now plans?
The process capacity will not change in the short term if Kristen offers only non-customized cookies. The case study makes it clear that the process that Kristen follows requires specific amounts of time to be spent at each step. However, in the long term, Kristen’s capacity will increase as she becomes more adept at making the one type of cookie she has elected to make. This will reduce the time required at some of the process steps (but not necessarily all) and ultimately increase the output capacity her and her roommate are able to achieve.
Pros of non-customized cookies: Time spent shopping will be reduced, as will overall variability in price of ingredients. Kristen and her roommate will become more efficient due to standardization They will become much better at making one type of cookie rather than many; total flow time will ultimately decrease from 27 minutes. Bottleneck will not decrease due to increased efficiency because cooking time is set. However, time spent mixing may increase as might the time spent receiving the order, packaging the cookies, etc.
As cookie quality increases due to standardization, demand will increase. Assuming more resources are not brought in, supply will likely stay the same. This will allow Kristen to increase the price for her cookies. Cons of non-customized cookies: Less variety will cause Kristen to set herself into a niche market. Some customers may not like the cookies Kristen bakes; others may have allergies, etc. Initial profits may not be as high as they would be if Kristen were to sell multiple types of cookies.