The design capacity for engine repair in our company is 80 trucks per day. The effective capacity is 40 engines per day. The actual output is 36 engines per day.
1. Calculate the utilization and efficiency of the operation.
2. You have estimated that work design studies could increase the effective capacity by five engines per day, while raising actual output by to 38 engines per day. What would be the new efficiency and utilization rates?
3. What determines what a good efficiency and utilization rate is? Would you spend $1000 for the design studies? How can you tell?