Project 3: Bullseye Warehouse Simulation

AIMS 3770 - Dr. Leon November 14, 2012

PROJECT 3: BULLSEYE WAREHOUSE SIMULATION

Bullseye Department store is a discount retailer of general merchandise in the Southeastern United States. The company owns more than 30 stores in Florida, Georgia, South Carolina and Tennessee that are serviced by the company’s main warehouse near Statesboro, GA. Most of the merchandise received at the warehouse arrives in trucks from ports in Jacksonville, Florida and Savannah, Georgia between the hours of 5 a.m. and 11 p.m.

Trucks arrive at the warehouse according to the distribution described in Table 1. One loading dock is currently available at the warehouse. Two workers are assigned to the dock and are able to unload the truck according to the distribution in Table 2. When the dock is occupied, arriving trucks wait in a queue until the dock becomes available.

Time Between Trucks (Minutes) Probability 10 .15 20 .2 30 .2 40 .25 50 .1 60 .1 Table 1: Arrival Distribution

Time to Unload Truck (Minutes) Probability 10 .05 20 .15 30 .15 40 .25 50 .2 60 .2 Table 2: Current System Bullseye has received complaints from the trucking firms lately that deliveries are taking too long at the warehouse. In response, Bullseye is considering a number of options to try to reduce the time trucks spend at the warehouse. One option is upgrade the forklift equipment used by the two workers in the loading dock to a new model that can be leased for $6 per hour and is expected to speed up time required to unload a truck (see Table 3).

Time to Unload Truck (Minutes) Probability 10 .10 15 .10 20 .20 25 .20 30 .20 40 .20 Table 3: With New Forklift Equipment

Alternatively, the company can build a second loading dock for a capitalized cost of $8 per hour and hire two additional workers at a rate of $10 per worker per hour to man this new location. Trucks would still form one line in the back alley, where the first truck in line would go to the next available loading dock. If needed Bullseye could upgrade the lift equipment at both loading docks as well for the same $6 per hour per unit leasing expense. Bullseye pays a shipping fee of $60 per hour that a truck spends at the warehouse. They would like you to help them identify which alternative will help them speed up their service and simultaneously control operational costs.

Two spreadsheet templates have been created for you in the Bullseye.xls file on the website. The first worksheet models a system with one dock. The second worksheet models a system with two unloading docks. Neither model incorporates the uncertainty present in the warehouse system.

Perform the following analysis for Bullseye:

1* Modify the first simulation model to include the uncertainty in the current loading dock system: determine random number intervals for the time between trucks and the unloading time and code the appropriate Excel formulas into the columns where the appropriate times need to be simulated. Extend the number of rows in the model to include enough trucks on average so as to simulate the primary hours of operation being addressed in the analysis. Program formulas to measure the system’s effectiveness. Consider performance measures such as waiting time, system time and idle time/utilization. Be sure to think about the bias in the start-up period and the length of period being simulated. How well is the current system working? What is the cost of the current system? (20 points)

2* Make a copy of the worksheet modeling the current loading dock system. In the second worksheet, study what will happen if the forklift equipment is upgraded. Adjust the distributions as necessary. How well would this system work? What is the cost of the upgraded system? (10 points)

3* Modify the two loading dock model to include the uncertainty in the system: determine random number intervals for the time between trucks and the unloading time and code the appropriate Excel formulas into the columns where the appropriate times need to be simulated. Assume that the original forklift equipment is used in both docks. Extend the number of rows in the model to include enough trucks on average so as to simulate the primary hours of operation being addressed in the analysis. Program the system performance measure formulas to include the relevant trucks for the analysis. Be sure to think about the bias in the start-up period and the length of period being simulated. How well would this proposed system work? What is the cost of this system? (20 points)

4* Make a copy of the two loading dock worksheet. In the second worksheet, study what will happen if the forklift equipment is upgraded at both docks. Adjust the simulated values as necessary. How well would this system working? What is the cost of the upgraded system? (8 points)

5* For each worksheet, perform at least 100 simulation runs for the proposed loading dock system. Collect data describing the relevant truck waiting time and the utilization rate of the system. Tabulate the results for each run and summarize the data you collected into meaningful output. Include this summary table as one of your worksheets in your submitted spreadsheet. (12 points)

6* Submit the Excel file that contains the five described worksheets to the Assignment section in MyLMUConnect for grading.

7* Write a memo to Bullseye that provides an analysis of your simulation results with a recommendation as to whether the company should build an additional loading dock or stay with only one as well as whether they should upgrade the forklift equipment or not. Be sure to describe the risks of the different situations by interpreting the expected performance as well as the potential downsides that can occur. Describe the potential costs of each of the systems. Turn a hardcopy of your memo to the instructor during class. The rubric on the following page will be used to grade this memo. (30 points)

8* The following guidelines can be used to organize your memo to Bullseye:

Paragraph Content 1 Summary of system recommendations (# of loading docks and type of forklift equipment you are recommending)

2 Analysis of operational performance and costs of the four different loading dock systems. Use tables wherever possible to summarize and compare numbers.

3 Concluding comments. PROJECT 3: BULLSEYE WAREHOUSE SIMULATION RUBRIC Points Organization Evaluation Evaluation of System Performance Cos Writing Communication of Numerical Results Criteria (Points x2) t Mechanics (Points x 3) calc ulat ions (Poi nts x 2) 3 Your memo is Appropriate The individual performances of the The Your memo is *The numerical results from the clearly and criteria are four proposed system scenarios are dail substantially free simulation and cost analysis are efficiently used to evaluated by accurately assessing the y from errors of communicated in a format such that organized. After evaluate the attractiveness of outcomes for all ope grammar, word the audience easily sees how they reading the first system’s evaluation criteria. rati usage, support the recommendations and paragraph, the performance. ng punctuation and statements made in the performance audience The standards cost spelling. analysis of the four systems. understands the for these s *The numerical results are clearly decision problem criteria are are identified with correct units and and knows your clearly and corr meaningful labels so that they can be general correctly ectl interpreted easily. recommendation stated. y *The expected outcomes as well as and the criteria calc some potential risks are on which you ulat communicated to the audience based your ed decision. and incl ude all rele van t lab or, equ ipm ent, faci lity and truc kin g cost esti mat es. 2 Portions of the Appropriate The individual performances of the The Your memo has a *Easy to read tables or graphs memo ramble or criteria are four proposed system scenarios are dail few errors of summarize the simulation results in a are too technical used to evaluated by accurately assessing the y grammar, word simple comparison of the expected and/or the first evaluate the attractiveness of outcomes for most of ope usage, recommended system versus non- paragraph does system’s the evaluation criteria. rati punctuation and recommended system performances not summarize performance. ng spelling, but they the decision The standards cost do not distract the *Appropriate numerical results are criteria and for one or s do reader to a presented in a format that is not easy recommended more of these not significant to read and therefore it is hard for the plan for the criteria are not corr degree. audience to clearly see how some of audience. clearly stated ectl the numbers support the performance or are y analysis of the four systems incorrectly calc stated. ulat e all rele van t lab or, equ ipm ent, faci lity and truc kin g cost esti mat es. Points Organization Evaluation System Performance (Points x 2) Cos Writing Mechanics Communication of Numerical Results Criteria t (Points x 3) calc ulat ion s (Po ints x 2) 1 Your memo Incomplete Not all of the systems are analyzed or The Your memo has *Key quantitative results are jumps from criteria are Some of the systems are incorrectly dail an accumulation communicated inaccurately or idea to idea used to analyzed y of errors of incompletely, thereby misleading the without a clear evaluate the ope grammar, word audience in its final decision or reason for system’s rati usage, making it impossible for the reader to moving in that performance. ng punctuation and fully compare the different systems. direction. It is cost spelling that addressed to s do distracts the the appropriate not reader from the audience atte points you are however. mpt trying to make. to incl ude all rele van t lab or, equ ipm ent, faci lity and truc kin g cost esti mat es. 0 Your memo Inappropriate The individual performances of the The Your memo is *Most of the quantitative results of does not criteria are proposed system scenarios are dail marred by many your analysis are not directly summarize the used to incorrectly analyzed or not interpreted y and serious errors communicated in any meaningful information for evaluate the at all. ope of grammar, form, thereby resulting in obscure or the appropriate system’s rati word usage, inaccurate claims about performances audience. performance. ng punctuation and that provide no real support for your cost spelling recommendation. s are not add ress ed in the ana lysi s. Points Earned: Points Possible: 3 3 6 6 3 9