Problem 4

ABS sells construction materials to commercial and home builders. One of ABSs key processes is the order fulfillment process shown below and described as follows:

All orders are assessed on arrival. The typical order spends 0.25 days in this order assessment step before moving on.

Of the orders, 30% are immediately declined for various reasons and have no processing time.

20% of all orders are large orders. Average total time in this large orders processing step, including waiting and actual process time, is 2 days.

50% of all orders are small orders. Average time in this small orders processing step, including waiting and processing time, is 0.5 days.

ABS receives an average of 20 order requests a day. The system is currently in steady state.

What is the estimated total inventory for the entire order fulfillment process?

Based on the information given earlier and your answer to part a, what is the estimate total throughput time for the average order entering the process?