State-Dependent Service Rates in Make-to-Order Shops:An Assessment by Simulation

Thurer, Matthias and Stevenson, Mark and Aitken, James and Silva, Cristovao (2020) State-Dependent Service Rates in Make-to-Order Shops:An Assessment by Simulation. Operations Management Research, 13. pp. 70-84. ISSN 1936-9735

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Abstract

Most literature on make-to-order shops assumes that service rates are independent of the system state. In practice however, the service rate is often dependent on the workload level experienced by the worker. While a body of knowledge on state-dependent service rates exists, the available literature has not given sufficient attention to make-to-order shops, which are often characterized by complex routings and defined due dates, which means delivery performance becomes a major concern. This study uses simulation to assess the performance impact of state-dependent service rates under different degrees of routing directedness. We show that including information on the load upstream of a station when making service rate adjustments has the potential to improve performance compared to considering the load directly queuing at a station only, as has been the case in previous research on state-dependent service rates. Moreover, using the same threshold to trigger service rate adjustments at each station in shops with directed routings leads to higher service rates at upstream stations. This service rate imbalance can be avoided by using different triggering thresholds for upstream and downstream stations. Further, and most importantly, we show that although speeding up behavior during high load periods significantly improves performance, if worker fatigue leads to a decrease in the service rate in response to the initial increase then performance may in fact deteriorate.