Questions to: Dr. Jorge Hernandez – [email protected] ASSIGNMENT The University of Liverpool Management School 2021 – 2022 (Semester 1) EBUS504 (Postgraduates) Operations Modelling and Simulation DEADLINE: to be confirmed (12 weeks of work) Lateness Penalty: Five percentage points shall be deducted from the assessment mark for each working day after the due date up to a maximum of five working days; however, the mark will not be reduced below the mark for the assessment under or equal 40%. Work assessed at below 40% will not be penalised for late submission of up to five working days. Work received more than five working days after the submission deadline will receive a mark of zero. Cheating: You are encouraged to discuss your general understanding of the exercise with colleagues of other groups, but, you must write up your project report based on the work of your group only. University regulations about cheating – especially COLLUSION and PLAGIARISM (copy from sources without acknowledgement) – apply. Hand-in procedure: Hand your work electronically by submitting a copy through the turnItin link on VITAL. If your work is late for medical or other good cause, attach a copy of your certificate and/or explanation. Notes: You must submit: ● One electronic copy (doc, docx or PDF) through CANVAS (EBUS504_SMITH_20091234.doc) ● an electronic copy of the witness, vensim and excel models developed through on CANVAS (all in one zip or rar file with your name and ID as filename e.g. EBUS504_SMITH_20091234.zip) Questions to: Dr. Jorge Hernandez – [email protected] 1. Practical questions: Operations modelling (40 Marks) Company ABC is running its production operation regarding the following details: The shopfloor has TWO machine 1 (M1a&b), ONE machine 2 (M2), TWO machine 3 (M3a&b), ONE machine 4 (M4), and ONE machine 5 (M5) To avoid any potential disruption, a temporary storage place (i.e. a buffer) is prepared in front of each machine. THREE operators are hired to provide manual service as M1 requires a setup before each run and M4 is a manual machine which requires operator’s assistance throughout each run. In this production, TWO types of finished products (i.e. A & B) will be produced and THREE types of raw materials (i.e. P1,P2,P3) are required in total. Particularly, type A is assembled in M4 with TWO p1 and ONE p2 (sequence p1-p2-p1); type B is assembled in M5 with ONE p2 and ONE p3 (sequence p2-p3). Once a finished product is completed, it is pushed to ship. The configuration details for all entities are in the table below. a) Use a Flowchart to map out the overall production process (5%); b) Use a Gantt Chart to identify the bottleneck of above operation and consider appropriate and sufficient quantitative evidence (e.g. some calculations) to support your argument (10%); c) Suppose the storage cost for each material is ￡1 per unit per minute, how much is the total storage cost if the operation runs for 15 hours Please propose TWO solutions to reduce the storage cost and benchmark the pros and cons of these two solutions in the context of a real-time operation (25%). P1 P2 P3 First arrival time 0 0 5 Arrival lot size 2 2 2 Inter arrival time 3 4 4 Process M1-M2-M4 M3-M4/5 M2-M3-M5 M1 M2 M3 M4 M5 Setup time 2 0 0 0 0 Cycle time 5 2 3 2 3 Questions to: Dr. Jorge Hernandez – [email protected] 2. Practical questions: System Dynamics (30 Marks) The COVID-19 pandemic has a massive negative impact on human wellbeing and the global economy since its outbreak at the end of 2019. Countries have started vaccination programs to protect the population against the spread of the disease and reduce the associated mortality. Therefore, governments have put an enormous effort on the stable, reliable, and rapid management of vaccination supply chain. During the pandemic, the procurement and inventory management for vaccine has gained immense attention. Assume that you are planning vaccine supply chain for a government. The government believes that system dynamics might help to plan procurement, inventory and deployment planning for vaccination program. It is very well known that if there is no vaccine in inventory, there can be no deployment of vaccine to hospitals. In other words, vaccinations are deployed from inventory. It is also known that if there is no vaccine procurement, there is no vaccine inventory. Each vaccine first goes into inventory once it arrives. If the vaccine deployment increases, government procures more vaccines. In each batch of vaccines purchased, a percentage of vaccines gets spoiled once they arrive. Assume that d% of vaccines purchased are always spoiled. Spoiled vaccines cannot be used, and they should be removed from the inventory. To be on the relatively safe side due to demand fluctuations, government has a target inventory which is equal to coverage level (c months) times vaccine deployment level (i.e. target inventory is c months of deployment). There is a time to replenish vaccine inventory and it is called lead time. a. (7 points) Draw the Causal-loop diagram, put the sign (positive or negative) for the whole model, discuss the model and write equations for variables. b. (16 points) A government wants a coverage level of 2
months and the lead time of vaccine is 1 month. Experts note that 3% of purchased vaccines are spoiled. Assume that the government has an initial inventory level of 50000 ready vaccines and the deployment of vaccination has a step-wise function with respect to time. Deployment is 45000 units between 0-10 months, deployment is 60000 between 10-30 months, and finally deployment is 40000 units between 30-50 months. – Establish complete model on Vensim and report model as screenshot in the report. Run this model on Vensim for 50 months with time step of 0.25. – Discuss results for inventory level, procurement level and show graphs of results. – Make detailed recommendations to the government. c. (7 points) The government also has the problem of prioritising the vaccination between age groups. Assume that four ages groups are studied by the government, namely age 70+, 50-70, 30-50, 19-30. Each age group has unique mortality rate with/without vaccine and mortality rate increases with respect to age. If you are asked to extend your model with a decision of allocating vaccines to age groups, what should be added in your model and in your parameters Critically discuss this new setting and suggest a new model (you do not need to solve new model). Questions to: Dr. Jorge Hernandez – [email protected] 3. Practical questions: Multi-Criteria Decision-Making (30 Marks) In one organisation there are several types of projects to be implemented, but the organisation needs help to prioritise them, so that they know how to plan their tasks for the next year under potential pandemic scenarios. For the selection of each project, and based on several focus groups within the organisation, the following main criteria has been identified: Stakeholders Commitment, Financial, Strategic, Implementation feasibility. After this identification, and based on several join analysis within the organisation, the following relationships were also identified: Stakeholders Commitment is four times less important than Financial, six times more important than Strategic and five times less important than Implementation Feasibility. Financial is three times less important than Strategic and six times less important than Implementation Feasibility. Strategic is six times more important than Implementation Feasibility. In the same way, for each criteria, the following sub-criteria and their relationships have been identified: Stakeholders commitment: Organisation commitments, Team Commitment and Project Manager commitment. Where relationships amongst them are as follows: o Organisation commitments is seven times more important than Team Commitment and two times more important than Project Manager commitment. o Team Commitment is two times less important than Project Manager commitment. Financial: profit, return on investment and net present value. Where relationships amongst them are as follows: o Profit is three times more important than Return on investment and equally important to Net present value. o Return on investment is two times less important than Net present value. Strategic: Access to international market, continuous improvement and reputation. Where relationships amongst them are as follows: o Access to international market is four times less important than continuous improvement and seven times less important than Reputation. o Continuous improvement is three times less important than Reputation. Implementation feasibility: Risk Organisation, Urgencies management and Internal knowledge. Where relationships amongst them are as follows: o Risk Organisation is five times more important than Urgencies management and seven times more important than Internal knowledge. o Urgencies management is five times more important than Internal knowledge. In this context, the Random index table is as follows: Questions to: Dr. Jorge Hernandez – [email protected] Regarding to this information please elaborate an MCDM excel matrix to support your answers to the following questions: a) Elaborate the hierarchical tree and identify each Weights for each criteria and sub-criteria. Provide the global and local weights. Based on the results, what are the most desirable aspects a project should consider (10 Marks). b) Calculate the consistency ratio. Analyse the result. (5 Marks). c) The organisation has received five project proposals and they are looking now to know which one will be the most convenient. Each proposal was interviewed to obtain the information about which criteria they prioritize. Considering the collected information about each project priorities shown below, please provide the benefit from each proposal and analyse the results. Which project should be selected : (15 Marks). o Project 1: Team commitment, net present value, Access to international markets, Urgencies Management. Cost: ￡40,000 o Project 2: Project Manager commitment, net present value, reputation, internal knowledge. Cost: ￡20,000 o Project 3: Organisation commitment, profit, reputation, Risk Organisation. Cost: ￡45,000 o Project 4: Team commitment, profit, continuous improvement, Risk Organisation. Cost: ￡44,000 o Project 5: Project Manager commitment, return on investment, reputation, Urgencies management. Cost: ￡70,000