467 AUT21 Advanced Business Analytics: Take Home Assessment, Giovanni Fernandez

Part 1: Personal Staffing in a Call Centre

1) a) For our simulation we use minutes as our time unit. This means the service rate of the company is 2 calls/min and the arrival rate
is 1.8 calls/min. Assuming both are exponentially distributed the arrival and service time are given by:
ln(𝑟𝑎𝑛𝑑()) ln(𝑟𝑎𝑛𝑑())
𝐴𝑡+1 = 𝐴𝑡 − , 𝑆𝑡+1 = 𝑆𝑡 −
𝑎𝑟𝑟𝑖𝑣𝑎𝑙 𝑟𝑎𝑡𝑒 𝑆𝑒𝑟𝑣𝑖𝑐𝑒 𝑟𝑎𝑡𝑒
The first customer will not wait so the time the service finished is A1 + S1. For subsequent customer i, the waiting time is
max (0, service finishedi-1 – arrival timei). The queue length is computed using countif function to determine the number of customers
who arrived earlier than the finished service time of previous customers. We code this in excel for 2500 customers and run 250
different simulations to obtain a distribution of the waiting times and queue lengths. As can be seen in figure 1, there is considerable
variability in both values, with a positively skewed distribution. The average waiting time is ~4min but can be as high as 11.8 minutes.
There is a 21% probability the waiting time is >5min. Likewise for the queue length while the average is 8 people, it can reach a max
of 22 people with a 28% probability of exceeding 9 people.
60%
50%
50%
40%
Frequency

40%

Frequency
30%
30%
20% 20%

10% 10%
0% 0%
1-3 3-5 5-7 7-9 9+ 3-6 6-9 9-12 12-15 15-18 18+
Waiting Time (min) Queue Length
Figure 1: Histogram of Waiting Times (left) & Queue Length (Right)

We can also use the theoretical formulas to compute the above. As both the service and arrival rate are exponential distributions, the
coefficients of variation are 1. There is also only one server so M=1. Thus, as utilization = A/(S*M) = 0.9. The theoretical values are
given below.
𝑝2 𝐿𝑞
𝐿𝑞 = = 8.1 , 𝑊 = = 4.5 𝑚𝑖𝑛
1−𝑝 𝐴
While the queue length and waiting time values are close to the average values obtained from the stochastic modelling, the formulas
they do not capture the volatility observed in figure 1. To use the theoretical formulas the system must be in equilibrium. Computing
T0 below, we can see this value is 95 min. This number is not relatively small compared to the timescale of our model, so the system
takes a relatively long time to reach equilibrium thus explaining the variability observed before.
𝑝 + 𝐶𝑠2 1
𝑇0 = 2
∗ = 95𝑚𝑖𝑛
(1 − 𝑝) 𝑀 ∗ 𝑆

b) i) We start by using excel countifs function. For each of the observed customers in the system (0 to 37 in the data set), we tally the
1.2 number that hanged up or not. The probability of
hanging up for a certain number of customers in
1.0 y = 0.0524x the system, is then the number who hanged up
R² = 0.9576 divided by the total number of customers who
Probability Hangs Up

y = 0.0346x experienced that queue size. This gives us the

0.8
R² = 0.9256
probability as a function of the number of
0.6 customers in the system as seen in figure 2. As
can be seen approximately after 20 customers
0.4 are in the system, the probability of hanging up
plateaus at ~1. Thus, we split the function into
0.2
two, to obtain a linear relation for the data up to
20 customers. This gives us the following
function:
0.0
0 5 10 15 20 25 30 35 40
# of Customers in the System if # of customers in the system is ≤ 20,
probability = 0.0524*number of customers, 1
Figure 2: Probability Customer Hangs up as Function of # of Customers in System
otherwise.
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 ii) We now modify our model by determinizing if customer i continues. Mathematically, for when the finished service time of customer
i-1 is > arrival time of customer i, the probability customer i hangs up = Pi = if (Lq,i-1 ≤ 20, 0.0524*Lq,i-1 , 1).

We can simulate this by saying if (rand() ≤ Pi , 0, 1), where customer i continues if a 1 is returned and hangs up otherwise. If the
customer does not continue then they are not served. If the customer continues, the formulas stated in Q’s 1a still apply. If the
customer hangs up, one is subtracted from the queue length formula used before (see excel model) as the customer is not in the
queue. 2500 customers and 250 simulations were again simulated. The policy decreases the average waiting time and queue length
considerably (fig. 3). The average waiting time drops to 0.62 min, an 85% decrease, while the average Lq dropped by 77% to 1.87.
Notably, the distribution is now closer to normal, as there is less variance. Thus, the policy both reduces the likelihood of extreme
variations, and the average value itself.
50% 40%

40%
30%
Frequency

Frequency
30%
20%
20%
10%
10%

0% 0%
<0.5 0.5 - 0.55 0.55 - 0.6 0.60 - 0.65 0.65 - 0.70 0.70+ <1.6 1.6 -1.7 1.7 - 1.8 1.8 - 1.9 1.9-2.0 2+
Waiting Time Queue Length

Figure 3: Histogram of Waiting Times (left) & Queue Length (Right)

iii) To compute the % of lost customers we count the number of those who hang up and divide it by the total number of customers
simulated. We then again run a simulation and build a histogram to
40%
understand the variability as per figure 4. The average customer lost
30%
is 7.1%, with a minimum of 5.76% & 8.52%. The range of variation is
Frequency

±1.3%, ~18% of the average value. This number is not drastic; thus,
20% we can expect the number of customers lost to not fall in extremes
but be relatively bounded around the average above.
10%
iv) To determine the new arrival rate, A2 that accounting for the loss
0% rate gives the same number of customers served we set the
<6.1% 6.1 - 6.5% 6.5 - 6.9% 6.9 - 7.3% 7.3 - 7.7% 7.7% + following equations. For time t, before the change the # of customers
% Customer Lost served = t × A1 = 1.8t. After the change the # of customers served =
t × A2(1-x)
Figure 4: Histogram of % of Customers Lost
Here x is the % of customers lost because of the new policy. x is a function of the arrival rate. As the arrival rate increases, for the
same service rate, the queue length will increase and thus customers will be more likely to hang up. Thus, first we determine x as a
function of the arrival rate. A regression analysis was performed using excel data table function (Appendix 1). This gives us that the %
of customers lost as a function of arrival rate is approxiamted by:
𝑥 = 0.0661 × A0.5832
For the new policy to serve the same number of customers after a time interval, t, the following equation holds:
1.8𝑡 = 𝑡 × A2 (1 − 0.0661 × A0.5832
2 ) 𝑡≠0

Solving the above, gives A2 is ~2 customers/min. This is only a 11.1% increase of the current customer rate which is not far fetch.
Because of improved customer service as customers can opt to call at a time when they will be attended quicker, we can expect that
this is feasible. We should note that the above is an approximation. Because of the stochastic nature of the simulation, we saw that
the % of customers lost can vary. Hence, in certain scenarios more customers could be lost than expected meaning less customers are
served vs those that would be served with the current arrival rate. However, on average the above holds true.

Part 2: Queue Management at Al-Ain Hospital

2) a) i) To explore staff hours to sensitivity to growth rate, a 2-way data table was used. The number of desks required for various
growth rates across the 20 weeks were computed for the three sections of the day. As the hours worked per desk for each part of the
day are known, the total staff hours as a function for different growth rates and time can be plotted. This was repeated for each

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 registration point (Appendix 2). Even though the growth rate was varied by at least ±100%, the total hours required are approximately
the same for all registration points, showing <±15% change. The staff hours are less sensitive early on but become more sensitive
towards week 20. As the growth rate is per week, as more time passes, the greater the impact it will have on demand. Finally,
registration points MB & W2 are the most sensitive, but again the variation is limited compared to the growth rate variation tested.
The same approach was taken varying service time for new patients (np) & existing patients (ep). The former was varied from 0.3 to
0.7 patients/min and the latter 0.05 to 0.117 patients/min. Full results are shown in appendix 3 & 4. For the np rate, points E, W1 &
W2 show considerable sensitivity to the service rate. This sensitivity is stronger up to ~week 10, and while it still exists, decreases
onwards to week 20. For instance, for E in week 1, increasing the service rate 2.3-fold from 0.3 to 0.7, increases staff hours ~2.3x from
168 to 384. This 1 to 1 increase suggests considerable sensitivity. However, by the end of week 20, the increase is only from 96 to 156
a 1.625 times fold increase. E, W1, W2 show much greater sensitivity than MB, as the % of new patients is higher for these points
early on. The sensitivity decreases as time passes as the new patient’s proportion decreases as they are already registered. For the ep
service rate time, we see the opposite effect. For all 4 points the number of hours is initially less sensitive to the service rate, as ep
proportion is < np. However, by ~week 5 the sensitivity increases as now the proportion of ep>np. The MB point is most sensitive as
it has the greater proportion of ep from week 1.
Consider the specific case when the service rate of ep & np decreases to 2.5 and 25 min/patient respectively. For each registration
point, the delta between the staff hours/d for the base case and new service rates was computed as a function of weeks (figure 5).

42 30
36 E
25 E
MB
30

Staff Hours/d
MB
Staff Hours/d

W1 20
W1
24 W2
15 W2
18
10
12
6 5

0 0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Week Week
Figure 5: Delta in Staff Hours/d Required Between Base Case and Changed New Patient (Left) & Existing Patient (Right) Service Rate
Decreasing the service rate for np reduces staff hours/d. Overall, the effect is biggest early on, and substantially decreases towards
week 20, with the delta decreasing by >50% for all registration point. This is expected, as np proportion is higher early on. The effects
are quite pronounced depending on the registration point. E makes the most saving per days, almost double that of W1 & W2. This is
because it has the highest proportion of new patients (~89%) and the highest arrival rate. In contrast W2 has the least benefit. Overall,
the cumulative staff hour saving is 436 h/d throughout the 20 weeks for point E, 2x more than W1/W2 and 8x times that of MB
(Appendix 5). Thus, policies decreasing np service rate should be focal for point E.
In contrast, halving the ep service rate, also has a positive effect but in the opposite way. Now the trend is that the staff hours/d saved
increases generally over time, as the % of existing patients increases. However, the extent is specific to registration points. E shows
an increasing trend from 0 to 24h/d, but MB & W1 start plateauing around 8h/d after week 7. W2 also shows an increase, but after
week 8, savings plateau at ~5h before increasing to 10h by week 20. E benefits the most because it has the highest growth rate (15
per week). Thus, each week as more np become ep, the improved service rate has a continuous saving effect. The results of both
savings and the cumulative staff hours saved are summarized in table 1. Overall E benefits the most from both policies by the end of
week 20, but if we could only choose one policy the focus should be on decreasing new patients service rate as 436 h/d are saved
over the 20 weeks. This optimum policy is also true for W1 & W2.
Table 1: Cumulative Staff Hours Saved for each Registration Point Across Time
Cumulative Staff Hours/d Saved (New Patient Service Rate/Existing patient Service Rate)
Week E MB W1 W2
1 40 / 0 12 / 0 20 / 4 20 / 0
10 288 / 116 28 / 64 144 / 64 108 / 36
20 436 / 328 52 / 140 216 / 168 168 / 96

b) i) Advantages: Merging two registration points will allow economies of scale as more customers will be passing through the facility
theoretically increasing the number costumers served per hour. Additionally, by handling more customers in one place learning curve
for staff could be decreases improving service rates.
Disadvantages: Economies of scale only occur until a point. After a certain arrival rate, the benefits you get plateau. Additionally
having everyone in one place may create psychological effects on customers in queues affecting customer service and service rates.
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 ii)
Table 2: Min # of Desks / Customers Served/h for Registration Points at Different Times of the Day (Week 1)
(min # of desks / Customers served/h)
Week E MB W1 W2
Morning 38 / 2.17 4 / 1.77 20 / 2.28 13/ 2.15
Afternoon 23 / 2.19 12 / 2.31 14 / 2.34 10 / 2.08
Evening 8 / 2.10 1 / 1.25 3 / 1.72 5 / 1.93

iii) Let Ai be the arrival rate of registration point i and the proportion of new patients, xi. If we now merge registration points W1 &
𝑥 × 𝐴 +𝑥 × 𝐴
W2, the new arrival rate, AW1&W2 = AW1 + Aw2 and the proportion of new patients, 𝑥𝑊1&𝑊2 = 𝑤1 𝑤1 𝑤2 𝑤2.
𝐴𝑤1 +𝐴𝑤2
𝑥𝑤1 × 𝐴𝑤1 +𝑥𝑤2 × 𝐴𝑤2
The same extends to a joint registration point of W1, W2, E in which AW1&W2&E = AW1 + Aw2 + AE, 𝑥𝑊1&𝑊2&𝐸 = .
𝐴𝑤1 +𝐴𝑤2

We can now use our model, where m = 1, to compute the Min # of Desks / Customers Served/h as per table 3 for the merged points.

Table 3: Min # of Desks / Customers Served/h for Merged Registration Points at Different Times of the Day
(min # of desks / Customers served/h)
Week W1 & W2 W1 & W2 & E
Morning 32 / 2.17 70 / 1.77
Afternoon 24 / 2.19 46 / 2.31
Evening 8 / 2.10 1 / 1.25

iv) For the different registration points we plot the customers served/h per desk against the arrival rate (figure 6). In general, across
all combinations as the day progress the arrival rate decreases and so does the customers served per hour. Comparing side to side
the merged desks (table 4) we can see there is a small benefit to the merging. Note for the ‘separate’ registration points, the customers
served per hour has been taken as the average of the individual registration points. For the W1 & W2 case, the merged point needs 1
desk less in both morning and evening, serving ~5% more customers/h. However, it has the same number of desks in the evening and
serves less customers/h than the two separate points. If we merge W1, W2 & E, now one less desk is needed throughout each section
of the day, but the number of customers served per hour is only higher in the morning by ~1.4%. Overall merging points has small
benefits. Less desks are required, saving in costs, but this is only a max of 1 per day section. This benefit could be offset by decreased
demand due to the psychological effect of seeing more people in transit/queues in a merged point. Finally, efficiency improvements
in terms of customers served per hour are limited, as economies of scale has less effect at this arrival rates. Overall, improvements on
reducing the service rate will be more beneficial than merging registration points.
Table 4: Comparison of Merged & Non-Merged Registration Points for Various Metrics
Morning Afternoon Evening
Registration
Min # of desks Customers Arrival Min # of Customers Arrival Min # of Customers Arrival
Point
served/h Rate desks served/h Rate desks served/h Rate
W1 & W2 (merged) 32 2.30 73.63 24 1.67 53.56 7 0.46 14.79
W1 + W2 (separate) 33 2.22 73.63 24 1.62 53.56 8 0.50 14.79
W1 & W2 & E (merged) 70 2.23 156.14 46 1.49 103.95 15 0.45 31.61
W1 & W2 & E (separate) 71 2.20 156.14 47 1.52 103.95 16 0.48 31.61

2.50
Customers served/h per desk

2.00

1.50

E (M) MB (M) W1 (M) W2 (M)

1.00 W1&W2&E (M) W1&W2 (M) E (A) MB (A)
W1 (A) W2 (A) W1+W2+E (A) W1&W2 (A)
0.50 E (E) MB (E) W1 (E) W2 (E)
W1&W2&E (E) W1&W2 (E)

0.00
0 20 40 60 80 100 120 140 160
Arrival Rate (Customers/h)
Figure 6: Customers Served/h per Desk for Different Arrival Rates for Registration Points (M: Morning, A: Afternoon, E: Evening)

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APPENDIX:

Part 1: Personal Staffing in a Call Centre

Appendix 1:

50%
y = 0.0661x0.5832
40% R² = 0.9525
% of Customers Lost

30%

20%

10%

0%
0 5 10 15 20 25
Arrival Rate (Customers/min)

Figure 7: % of Customers Lost as a Function of Arrival Rate

Part 2: Queue Management at Al-Ain Hospital

Appendix 2:

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Figure 8: # of Staff Hours/d as a Function of Time for Point MB for Various Growth Rates

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Appendix 3:
New Patient Time

Figure 12: # of Staff Hours/d as Function of Time for Point E for various NP Service Rate

Figure 13: # of Staff Hours/d as Function of Time for Point MB for various NP Service Rate

Figure 14: # of Staff Hours/d as Function of Time for Point W1 for various NP Service Rate

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 Figure 15: # of Staff Hours/d as Function of Time for Point W2 for various NP Service Rate

Appendix 4:
Existing Patient Time

Figure 16: # of Staff Hours/d as Function of Time for Point E for various EP Service Rate

Figure 17: # of Staff Hours/d as Function of Time for Point MB for various EP Service Rate

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 Figure 18: # of Staff Hours/d as Function of Time for Point W1 for various EP Service Rate

Figure 19: # of Staff Hours/d as Function of Time for Point W2 for various EP Service
Rate
Appendix 5:

Cumulative number of staff hours/d saved for each week for improved efficiency for new patient and existing patient service rate.

Figure 9: Cumulative Staff Hours Saved from Base Case for Decreasing NP Service Rate to 25min/patient.

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Figure 10: Cumulative Staff Hours Saved from Base Case for Decreasing EP Service Rate to
2.5min/patient

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