The effect of non-linear delay costs on workforce mix

This paper formulates a simple model to examine the appropriate mix of dedicated and flexible maintenance technicians (servers) required when total delay cost is a non-linear function of mean delay time. The primary decision variable is the number of flexible servers needed to minimize system related costs. Non-linear delay costs appear to significantly increase the level of cross training required compared to previous research using a linear cost function, which showed that a small proportion of flexible servers was sufficient. This has important implications for service system designers in regard to the amount of cross training that might be appropriate. INTRODUCTION An important consideration in the design of a service system is creating a balance between customer demand and service capacity. This paper focuses on a field-based service application, the provision of after-sale service. This type of service, referred to here as field service, has limited capability to balance demand with capacity. A major component of the demand side is the occurrence of random equipment failures, which cannot be leveled to any significant degree. Therefore, firms must achieve a balance by managing capacity. The variability in demand can be eased by either increasing capacity or by increasing the flexibility of available capacity. The main challenge is to meet the random “arrivals” of machine breakdowns in a manner that minimizes delay for the customer while controlling costs for the firm. Firms want to cross-train their servers (field engineers) so that they can respond to the different customer types. Although the cross training of servers increases server flexibility, it also increases service costs, such as out-of-pocket training costs, and the loss of productive time while the field engineers are in training. Initial training may last for up to a year and technology upgrades will necessitate additional training. This paper formulates a simple model to examine the appropriate mix of dedicated and flexible maintenance technicians (servers) required when total delay cost is a non-linear function of mean delay time. The primary decision variable is the number of flexible servers needed to minimize system related costs. Non-linear delay costs appear to significantly increase the level of cross training required compared to previous research using a linear cost function, which showed that a small proportion of flexible servers was sufficient. This has important implications for service system designers in regard to the amount of cross training that might be appropriate. RELEVANT LITERATURE Issues in field service operations have been discussed by Hill [7], [2], and [8], among others. Currently there is little research available covering a field service environment where failures