boeing casestudy

8/9/2019 boeing casestudy

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Office staff planning at Boeing Aircraft

Executive Summary:

Boeing Aircraft has been asked by the federal government to resubmit its bid to be prime

contractor for a modified version of the space station. Boeing’s design division is expected to

need temporary additional secretarial support to handle a substantial increase in paperwork.

The whole process will be continued until the bid is completed. Boeing can hire temporary

personnel from Techhelp, a local temporary help firm. Techhelp is specialized in technical

secretarial support, or it can temporarily transfer secretarial staff from other divisions within

the company. The house secretary who is transferred can produce around ! pages daily, two

hours a day with technical assistance from supervisory personnel .As he or she is less familiar

with the Boeing environment than Boeing employees, it is estimated that a Techhelp

employee can produce only "! pages of work per day. But on the other hand the Techhelp

employee’s higher degree of technical secretarial training, however, each employee only

re#uires approximately one hour of technical assistance from supervisory personnel.

Boeing has allocated up to $! workstations to the design division for additional secretarial

support and one full%time employee for technical assistance providing eight hours of technical

support time available daily.

By: Section C Group 1

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'ate of Su-mission: $r. /e-ruary 01)


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Statement of te 2ro-lem

Boeing’s design division needs more paperwork to resubmit the bid for being the

prime contractor for a modified version of the work station.

&ack of in house personnel to complete the re#uired paperwork

Causes of te 2ro-lem

Boeing has to resubmit the bid for being the prime contractor for a modified version of the

work station.

'ecision Criteria an. Alternative Solutions3

• Boeing can hire for Technical additional secretarial support from Techhelp 'a local

temporary help firm(.

• Temporarily Boeing can transfer secretarial staff from other divisions within the

company.

• Boeing can use a combination of employees from Techhelp as well as temporary

transfers from other divisions in the company.

"ecommen.e. Solution #mplementation an. 5ustification

• )e will recommend for increase or decrease of Additional hours and workstations

with allowable increase or decrease to gain maximum profit.

• )e came to this recommended solutions after analysing the &* model and sensitivity

report.

En.6of6case 7uestions

a( +ormulate a linear program to determine the optimal number of temporary Techhelp

employees to hire and in%house transfers needed to maximize the total potential

number of pages produced per day. Assume that fractional values represent workers

assigned part time to the division.

O-8ective: To maximize the total potential number of pages

,aria-les:

-$ /n house 0ecretary

-1 2utsourced


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#n ouse Secretary91; Outsource.9;

!ec

assistance9!ecelp;

r 1r

)e can formulate this &* problem as follows3

4aximize3 ! -$5"! -1,

0ub6ected to the constraints3

1-$5-178

-$ 5-17$!

-$, -19!

b( )hy is there a nonzero reduced cost associated with the output of in%house transfers but

not with the output of Techhelp employees: )hat is the reduced cost for the output of in%

house transfers:

• Associated with each variable is a reduced cost value. ;owever, the reduced cost

value is only non%zero when the optimal value of a variable is zero.

• The reduced cost value indicates how much the ob6ective function coefficient on the

corresponding variable must be improved before the value of the variable will be

positive in the optimal solution.

• /n this case of a maximization problem,


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c( >alculate the range of optimality for each ob6ective function coefficient. ?xplain in simple

terms why the lower limit for the range of optimality for the output of in%house transfer is

infinity:

The range of optimality

Variable Original Value Lower

Bound

Upper Bound

-$ ! %infinity @!

-1 "! 1! 5infinity

&ower bound shows infinity, because it does not affects our final profit.

d( etermine and interpret the range of feasibility for the availability of the number of

workstations and the number of hours of technical assistance available.

Constraints Original

Value

Lower

Bound

Upper

Bound

Shado

w

price

fnal

>onstraint$';ours( 8 ! $! "! 8

>onstraint1'work stn( $! 8 5infinity ! 8

+or every unit of allowable increase 'upper bound(, we get profit of "!units, but the range is

allowable till $!maximum and we can’t decrease here.

+or every unit of allowable increase 'upper bound(, we get no profit, but the range is

allowable till infinity and we can decrease it till 8unit.

e( ?xplain in simple terms why the upper limit of the range of feasibility for the number of

workstations is 5 infinity.

)orkstation is the redundant constraint, which does not affect feasible region solution after

refereeing to graph. 0o upper limit range could be 5infinity.


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f( 0uppose, in monetary terms, Boeing feels that each additional potential page is worth $

and the cost of a supervisor’s time for technical assistance is 1C per hour. Dsing shadow

prices, show why having up to two additional hours of supervisory assistance is profitable tothe company. 0how 'by re%solving the problem( why hiring a second full time employee

'increasing the hours of available technical support to $@( would not be in Boeing’s best

interest.

*art $3

?ach additional potential page $

The cost of a supervisor’s time for technical assistance is1CEhour

Fes, having up to two additional hours of supervisory assistance is profitable to the company.

Because, we get maximum value"!!

0o, Boeing get "!!%1!@! more investing G 1 additional hours of supervisory assistance

1 additional hours of supervisory assistance3 1H1CC!'hence profitable(

*art 13

After increasing the hours of available technical support to $@,

4aximum value"@!

0o, "@!%1!$1! extra profit with investing more 8 hrs.

8hrs38H1C1!!

ue to loss, hiring a second full time employee would not be in Boeing’s best interest.


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etailed report '*art$(

Answer report3

0ensitivity report3

&imits report3

etailed report 'part1(

Answer report3


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0ensitivity report3

&imits report3


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"eferences

Balakrishnan, R. S. (n.d.). Managerial Decision Making Modeling with

Spreadsheets.

Schedlbauer, M. (n.d.). Interpreting Solver Sensitivity Report . Retrieved from

https://www.outube.com/watch!v"#l$$RMM%sno.

Schrimshaw, &. '. (n.d.). Sensitivity report in Excel. Retrieved from

https://www.outube.com/watch!v"#l$$RMM%sno.

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