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NEED THE PROGRAM EXTENDSIMPLEASE OPEN THE CASE STUDY AND ANSWER THE QUESTIONS. THERE IS A BASELINE OF THE STIMULATION DRAWN ON THIS CASE STUDY. OPEN EXTENDSIM AND CREATE A STIMULATION MODEL.
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OSCM435
Prof. Hang Ren
Young’s Main Hair Salon (Part II)
It was a quiet Monday morning in Ms. Young’s Main Hair Salon, as usual. After two consecutive
busy days, Ms. Young was finally rested in her armchair in a corner of the shop, while looking
over her glasses at your laptop where customers were getting their haircut done in ExtendSim.
“Amazing!” Ms. Young exclaimed. “You know what I like the most? Not the fancy animation, but
your understanding about my business. You have no working experience in a hair salon but your
recommendations seem to come from an expert stylist! Actually, I have also thought about them,
but that’s after so many years managing the whole process.”
Resources
“But wait,” Ms. Young seemed to notice something and pointed to the Haircut station and then the
Hair wash station (see below). Can we have 3 customers having haircut and 2 having hair wash at
the same time? As you know, I have only 3 stylists to do both jobs.”
On second thought, you realized that your simulation model missed an important component–Resources. To specify resources in your model, you consulted Ms. Young about resource usage in
each activity. As she said before, Haircut and Hair wash are both performed by a stylist and the
same stylist does both jobs for a customer. There are 3 stylists in total, including Ms. Young herself.
In addition, Hair wash requires the use of a wash station and there are 2 in total.1 The Receptionist
activity is done by a dedicated receptionist, so you don’t need to model her as a resource. A
baseline simulation model named Baseline.mox is provided separately. This model is structurally
correct but parameters of Resource-relevant blocks have not been specified (all other parameters
have been specified).
Costs
1
Assume that Ms. Young has enough salon stations for all stylists to perform haircut at the same time (make sense
in reality?).
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OSCM435
Prof. Hang Ren
In addition to Resources, you decide to add cost data into the process to capture important tradeoffs among different dimensions, e.g., staffing vs. waiting. Ms. Young is also happy with your
plan as she will have a better idea about the monetary value of your recommendations in improving
process performance.
Through extensive data collection, you identify cost & revenue as follows. First, each customer
generates revenue $25. Second, keeping a customer waiting in a queue costs $12/hr due to the risk
of reputation loss (there is no cost waiting in activity). Third, Ms. Young pays each stylist
(including herself2) $10 for serving each customer. In addition, each haircut costs $0.5 due to
equipment depreciation and hair wash costs $0.2/min due to water usage. Ignore all other costs not
specified here, e.g., overhead.
Questions3
1. Modeling Resources (15pts). Why considering resources can address Ms. Young’s
question that “Can we have 3 customers having haircut and 2 having hair wash at the same
time?”? Specify all missing parameters in the baseline model and run the simulation with
animation on. Explain what you have specified, what you see from animation and do they
make sense?
a. Hint: what is the fundamental difference between our old model and the new model
considering resources?
b. Hint: need to specify parameters in the following types of blocks: Resource Pool,
Queue (which and why?), Activity (which and why?), Resource Pool Release.
c. Hint: in explaining what you see from animation and why they happen, focus on
blocks that are relevant to resources, e.g., Resource Pool and Queue.
d. Hint: what is the use of the new queue block named Wait for wash station? Does it
create the problem of removing blockage of Haircut when Hair wash is busy, as we
have in our old model and this blockage represents reality (see solution of Question
5 in our last group project)?
2. Adding Resources (25pts). How long on average does a customer wait in chair in steady
state? Which resource is the bottleneck? Evaluate the following methods to reduce the
average wait in chair: (i) adding 1 more bottleneck resource; (i) adding 1 more nonbottleneck resource. Compare these two methods in terms of wait time reduction and
potential implementation issues.
a. Hint: keep the end time as it is, i.e., 1000k, or make it even longer; the process will
not stabilize if end time is shorter than 1000k.
b. Hint: in practice, can we add one more bottleneck resource easily? Will adding a
non-bottleneck resource reduce average wait at all (go back to solution of our last
group project)? If yes, will the reduction be significant or not? Why or why not?
2
3
Obvious Ms. Young doesn’t need to pay herself in reality. Here we assume she does to simplify the model.
Incorporate costs in your simulation model only in Questions 4 and 5.
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OSCM435
Prof. Hang Ren
3. Resource Specialization (25pts). It turns out that both methods proposed in Question 2
are not satisfactory at some key dimension. Therefore, you consulted course instructor Dr.
Ren and got a hint: can we add a new resource (with 1 unit) that can take the easy part of
the job of our bottleneck resource (e.g., hair wash)? Please (i) describe what this method is
in detail in this specific business setting; (ii) compare this new method with the two
methods in Question 2 to explain its advantages & disadvantages; (iii) model the new
method (explain what you have changed and why), run the simulation, explain what you
see and comment on whether they make sense; (iv) characterize the reduction in average
wait and compare it to the two methods in Question 2. Is the reduction from the new method
bigger or smaller? Why?
a. Hint: resource allocation for Hair wash activity (specified in the queue block before
this activity) now depends on whether the new resource is available or not. Use a
Select Item Out block controlled by the number of available unit of the new
resource (either 0 or 1 as we add 1 new resource; use the L connector of Resource
Pool) to select between two paths. If the new resource is available when a customer
completes haircut, what will happen are: (i) the stylist is released; (ii) the new
resource is attached to the customer using a queue block; (iii) the customer waits in
a second queue for an available wash station; (iv) hair wash is performed; (v) wash
station and the new resource are released. If the new resource is not available, then
what follows are similar to our benchmark model.
b. Hint: in explaining what you see from animation and why they happen, focus on
new blocks added in this question, e.g., the Select Item Out block.
c. What is the workload reduction of our bottleneck resource after adding the new
resource? What is the reduction in average wait after adding the new resource? Do
you expect to see such a big/small improvement, considering the magnitude of
workload reduction?
4. Modeling Costs (20pts). Specify all cost parameters in the model you built in Question 1
(do not incorporate any methods mentioned in Question 2 or 3). What is the average profit
margin from each customer? Does it make sense?
a. Hint: convert waiting cost from per hour into per minute. Use Cost by Item block
to track average cost/profit margin per customer.
b. To ensure all cost parameters are correctly specified, you can obtain a summary of
all costs (except those in Create block) using Cost Stats block.
c. Average profit margin per customer=per-customer revenue–waiting cost–
resource/activity usage cost.
5. Adding resources revisited (15pts). You showed the revised model to Ms. Young and
explained to her the three methods described in Questions 2-3. Although Ms. Young was
pretty impressed by the potential of the method in Question 3, she hoped you can conduct
a cost analysis on the method of adding another stylist. This is because Ms. Young found
a good stylist who is willing to do part-time job for her. Ms. Young will provide a new
salon station for the new stylist (i.e., we have 4 salon stations and still 2 wash stations) and
will pay her the same per-customer wage of $10 as other stylists. However, Ms. Young
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Prof. Hang Ren
hesitated about the fixed monthly payment—the stylist will ask for at least $1,000 but Ms.
Young is unsure if the stylist can deliver enough benefits to cover that amount. Please help
Ms. Young decide the maximum fixed monthly payment. Assume that the stylist works for
5hrs per day, two days a week, and 4 weeks in a month.
a. Hint: the maximum amount = increase in profit margin per customer * number of
customers served during the stylist’s working hours in a month.
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