Question
The manager of the Personnel Department at Binder City has been reading about time-driven ABC and wants to apply it to that department. The manager
The manager of the Personnel Department at Binder City has been reading about time-driven ABC and wants to apply it to that department. The manager has identified four basic activities Personnel Department employees spend most of their time on Interviewing, Hiring, Evaluation, and Exit. The department employs seven staff members who perform these activities. The manager provides the following estimates for the amount of time it takes to complete each of these activities:
Interviewing: 40 minutes.
Hiring: 45 minutes.
Evaluation: 85 minutes.
Exit: 105 minutes
Employees in Personnel work 37.5-hour weeks with four weeks for vacation. Of the 37.5 hours, 5 are reserved for administrative tasks, training, and so on. The costs of the Personnel Department, including any allocated costs from other staff functions, are $1,244,880. During the year, Personnel conducted 1,100 interviews, made 640 hires, made 5,400 evaluations, and had 400 separations.
The manager of the Personnel Department decides that the estimate of the activities might be too simple in two ways. First, the time to interview depends on the level of the position for which a candidate is sought. The personnel manager estimates that for a candidate at the manager level, the additional interviewing time is 90 minutes. (Personnel Department employees only conduct the initial interview, but they accompany the candidate for interviews by the hiring executive or CEO.) For a candidate at the executive level, the additional time for interviewing is 180 minutes (in addition to the time required for a manager).
The second issue the personnel manager identified is that the time for exit processing depends on whether the exit is voluntary. The manager estimates that an involuntary exit requires an additional 150 minutes of personnel time.
A.What is the total time required for the interviewing activity?
B. What is the total time required for the separation processing activity?
C.What is the cost of interviewing a manager? An executive?
D.What is the cost of a voluntary exit? An involuntary exit?
A.
Manager | minutes | |
Executive | minutes |
B.
Voluntary separation | minutes | |
involuntary separation | minutes | |
total time | minutes |
C.
Manager | |
Executive |
D.
Voluntary exit | |
involuntary exit |
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