UntrainedFA Training Vacation Pool of

trained FAsServe on flights

QuittedFA

T = 6 wks 1 wks ? wks 2 years

R

Train new flight attendants. 1000 flight attendants are needed to maintain in flight service. Attendants have high propensity to leave. On average they stray for 2 years and then leave. Training course for new attendants takes 6 weeks. After completing training, attendants take one week vacation. They then enter a pool to fill for leaving attendants as needed. They will be paid $500 per month while are training, vacationing, and waiting in the pool. The cost of training contains salaries for instructors and support personnel of $190+$60 = $250 per instructor and support per trainee per week. A training team contains 10 instructor and 10 support personnel. They are paid only for the training period. Pay is independent of both the class size and the number of classes running simultaneously. How do you plan this process to minimize costs?

Flow unit = one flight attendant (FA). Input (un-trained FA) Training Process Output

(quitted FA).Tradeoff between fixed and variable costs in a service

industry.The airline requires a staff of about 1000 I = 1000Average job tenure being about 2 years T = 2 yrsI = RT R = 500 /yrWe pay the trainees $500 per month. That is $6000 per

year or 6000/50 = $120 per week.Training $250 per Instructor and Assistant. Ten pair of

Instructor and Assistant for 5 weeks; 6(190+60)*10 = $15000

UntrainedFA Training Vacation Pool of

trained FAsServe on flights

QuittedFA

T = 6 wks 1 wks ? wks 2 years

R

What will happen if we train all the 500 attendants 7 weeks before the year starts.

Instruction cost = 250*10 *6 = 15000 Attendance salary while waiting for assignment

6000(500/2) = 1,500,000Total = 15,000+1,500,000 = 1,515,000Payment for training and vacation for all = 840 (500) =

$420,000

What will happen if we train all the 70 attendants 7 weeks before the year starts. And then 70 more. Each time 10

Instruction cost = (250*10 *6)( 500/70) = 107,143Attendance salary while waiting for assignment

6000(70/2) = 210,000Total = 107,143+210,000= 317,143Payment for training and vacation for all =

840*70*500/70 = 840*500 = 420,000Untrained

FA Training Vacation Pool oftrained FAs

Serve on flightsQuitted

FA

T = 6 wks 1 wks ? wks 2 years

R

6000

15000)500(22

H

RSEOQ = = 50 units.

# of classes = R/Q = 500/50 = 10Cycle inventory = 50/2 = 25The annual cost will beS(R/Q) + H(Q/2) + RC15000(10)+6000(25)+500(840)150000 +150000 = 300,000+ 420000 = 720,000Inventory cycle = 50/10 = 5 weeks. 6 weeks to produce. 5 weeks to consume

View IITraining and vacation is ordering costTherefore, ordering cost has two parts; Fixed and VariableFixed Ordering cost = S =15000Variable ordering cost is 6+1 weeks pay (6000/50)7 C = 840 St = S+CQHis annual cost will beS(R/Q) + H(Q/2) (S+CQ)(R/Q) + H(Q/2) S(R/Q) + CR + H(Q/2)= 720,000Inventory cycle = 50/10 = 5 weeks. 6 weeks to produce. 5 weeks to consume

Q = 50

Q = 50

Q = 60