Efficiency & Utilization Solved Problems
Q1: Given the following information, compute the efficiency and the utilization of
the vehicle
repair department:
_
Design capacity 50 trucks per day
Effective capacity 40 trucks per day
Actual output 36 trucks per day
SOLUTION
Efficiency:= Actual output/ Effective capacity x100
=36 trucks per day/ 40 trucks per day x 100 = 90%
Utilization= Actual output/ Design capacity x100
= 36 trucks per day / 50 trucks per day x 100 = 72%
Q2: Sara James Bakery has a plant for processing Deluxe breakfast rolls and wants
to better understand its capability. Last week the facility produced 148,000 rolls.
The effective capacity is 175,000 rolls. The production line operates 7 days per
week, with three 8-hour shifts per day. The line was designed to process the nut-
filled, cinnamon-flavored Deluxe roll at a rate of 1,200 per hour. Determine the
design capacity, utilization, and efficiency for this plant when producing this
Deluxe roll.
SOLUTION
Design capacity = (7 days * 3 shifts * 8 hours) * (1,200 rolls per hour) = 201,600 rolls
Utilization = Actual output/Design capacity = 148,000 / 201,600 = 73.4%
Efficiency = Actual output/ Effective capacity = 148,000 / 175,000 = 84.6%
Q3: The Crystal Sparkle Co. produces glass tumblers. The plant is designed to
produce 400 tumblers per hour, and there is 1 eight-hour shift per working day.
However, the plant does not operate for the full 8 hours: the employees take
two15-minute breaks in each shift, one in the first 4 hours and one in the second
4 hours, the first 30 minutes of the shift are spent raising the kilns to the
required temperature for firing glass. The plant usually produces about 10,000
tumblers per five-day workweek. Answer the following questions by adjusting the
data to one eight-hour shift.
What is the efficiency ratio AND utilization?
a. Design capacity = 8 hrs. x 400 tumblers = 3,200 tumblers per 8-hour shift.
b. Effective capacity = Design capacity -Nonproductive activities.
Design capacity -8.0 hrs.
Less: Breaks : 0.5 hrs.
Heat-up:0.5 hrs.
Net productive time: 8 -0.5 -0.5 = 7.0 hrs.
Now, Effective capacity = 7 hrs. x 400 tumblers = 2,800 tumblers.
c. Actual output = 10,000/5 = 2,000 tumblers per 8-hour shift.
Efficiency & Utilization Solved Problems
(This is an average output. In reality, there could be variation; some shifts could exceed
2,000 tumblers while others fall short.)
d.Efficiency = Actual output/Effective capacity = (2000)/2800 x 100 = 71.43%.
e.Utilization = Actual output/Design capacity = (2000)/3200 x 100 = 62.50%
