Page 87 - DMGT501_OPERATIONS_MANAGEMENT

Unit 3: Capacity Planning

Notes

Case Study Apollo Hospitals

he Chief Executive of Apollo Hospitals is attempting to determine the capacity of
their out-patients department. The flow of people to the hospital follows this
Tsequence. People arrive at the hospital and park their cars. From records that the
hospital keeps, 40 per cent of the guests who come in are visitors to the in-patients wards.
The remaining 60 per cent of the arrivals go to the out patients area.
Table 1: Resources in the Out-patient Department

Department/Area Capacity/Size Service /Rate
Parking Area 500 Spaces 2.2 persons per car
Registration Area 3 Attendants 5 minutes per patient
Seating Area 6000 sq. ft. Waiting time 60 minutes
No. of Doctors 30 10 minutes per patient

According to standards that management has developed over the years, 50 per cent of the
patients require registering and it takes about five minutes at the registration desk. After
that, the patient goes to the specific out-patients department and requires six square feet of
seating space including infrastructure. Table 1 depicts the resources of the hospital.
On the average 2.2 people arrive per car; only 90 per cent of the seats in the waiting area
are normally available because sometimes patients come in wheel chairs and stretchers.
The average stay is sixty minutes. Of the 2.2 people who come in a car, only one person is
a patient. There are 30 doctors to attend to the patients. The management anted to know
the capacity of the system.
To begin, the capacity of each area can be calculated in terms of persons served per hour.
To calculate the capacity of the system and determine the bottleneck department in this
case, we can start by inspecting the department capacities. It is clear that the system's
capacity cannot exceed 180 patients/hour because that is the capacity of the number of
patients the doctors can treat. This is also the optimum capacity. We start looking at the
service capacity of each department. The results are shown in Table 2.
Table 2: Service Capacity of each Department

Department/Area Capacity (People/Hr.) Patients/Hr
Parking Area 1100 300
Registration Area 36 72
Seating Area 1000 409
Doctor 396 180

This calculation yields the system capacity, 72 patients per hour. The bottleneck department
is the registration area. In spite of the fact that doctors are available, patients cannot see the
doctors because they need to register. There is a justification to increase the number of
people in the registration area so that the doctors are fully utilized. We can also see that if
there is demand for the hospital's services, the hospital could expand to cater to around
400 patients without a major investment in assets.
Contd...

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