Question

A medical facility was designed for 500 lab tests per day. Since this facility has been converted to do tests only for coronavirus, its effective capacity has been reduced to 450 tests per day. Its actual output based on the past 7 day’s data is 300 tests per day.

a. Calculate the efficiency and utilization of this facility.

b. What does this facility have to do to operate at 80% efficiency?

c. What do you think might be some factors that are contributing to a lower effective capacity?

Answer 1

Answer (a): Designed capacity = 500 tests

Effective Capacity = 450 tests

Actual capacity = 300 tests

• Facility Efficiency = [Actual Output/Effective Capacity] × 100

Facility Efficiency = (300/450) × 100 = 66.67 %

Facility Efficiency = 66.67%

• Facility Utilisation = (Actual Output/Designed capacity) × 100

Facility Utilisation = (300/500) × 100 = 60%

Facility Utilisation = 60%

Answer (b): To increase the efficiency of the Facility from 66.67% to 80% , the facility must increase its actual output.

Let's assume X tests are needed to be done ler day to achieve the efficiency of 80%.

Facility Efficiency = ( output/ Effective Capacity) × 100

Facility Efficiency = (X/450) × 100 = 80

100 X = 450 × 80

X = 36000/100

X = 360

It means to gain Facility efficiency of 80% , facility must increase its actual output to 360 Per day.

Efficiency in this case can be increased by providing proper training and experience to the Employees because Employees have no experience and little training in lab tests relating to Coronavirus, so to increase efficiency, Employees must be trained well.

Answer (c): Factors Contributing to Lower Effective Capacity

Effective Capacity is the output that can be produced at maximum given the various constraints such as Human Resource constraint or process constraint. Some factors that contribute to lower effective Capacity in this facility are:

• Lack of Training, skills and experience : This facility was designed for various lab tests but now it's been converted to do only Coronavirus tests. It's a new virus and the test have different procedure and Employees are not properly trained and have no experience in conducting these tests so that's one reason why the effective Capacity has reduced.
• Output quality: Output quality must be top class in this case i.e., facility can't take risks of negligence which will lead to wrong results as it's a matter of life for patient so the quality of the tests done must be excellent. This will reduce effective Capacity.
• Supply chain factors: New suppliers will be needed to supply the equipments required to conduct these new tests and effective Capacity will be effected by the efficiency and effectiveness of these new suppliers.