This case was prepared by David Hoyte, Tom Griffin, and Yuliya Yurova, professors of Research Methods and Decision Sciences at the H. Wayne Huizenga School of Business and Entrepreneurship, Nova Southeastern University. It is intended as a basis for class discussion. Main characters, locations, and numbers in this case were modified to preserve privacy. Copyright (c) 2014, Nova Southeastern University. March. 31, 2014
Paws Palace Clinic has been a successful and growing veterinary practice in Parkland,Florida, owned and run by Veterinarian Dr. Bill Schulke, and his office manager / spouse, Sue Schulke. Over the last 12 months, the practice has been averaging $80 profit per patient visit, which is helpful for the young couple to pay back Bill’s enormous college loans. For the first two years of operation normal office hours at the clinic from 8:00am to 5:30pm.
Review @Risk interactive tutorial “@Risk Quick Start”. (To do this, open @Risk and go to Help; select Welcome to @Risk; a new window will open where you should select Quick Start to see the tutorial.)
Study the case “Paw Palace Pet Clinic” and download data file “Paw Palace Data.xlsx” from BB9. Compute descriptive statistics for historic inter-arrival and service times in tab Data. In @Risk, fit Normal, Uniform, Exponential, and Triangular distributions to historic inter-arrival and service times (IAT and ST). What is the best and what is the worst fitting distribution for IAT? For ST? Paste the @RISK histograms you develop for the IAT and ST (service time) data on your tab Data – input data worksheet.
Analyze the simulation model in tab “Current Model B”. Answer the following questions:
1. How many patients per day does the clinic serve on average? There is a 95% probability that _______ or more clients will be served per day.
2. What are the average daily and annual profits from the business? There is a 95% chance that $________ or more profit will be made per day; and $__________ or more will be made during the first year.
3. What are the average and maximum wait times? There is a _______% chance that customers will have to wait 25 minutes or less, a ________% chance that customers will have to wait between 20 and 40 minutes, and a ________% chance that customers will have to wait longer than 40 minutes.
4. What is the average number of reneges? There is a 95% chance that at least _____ of customers will renege daily. There is a 65% chance that no more than _____ customers will renege daily.
Prepare a report including Background, Problem Statement, Analysis (method of analysis, input variables, description of input variables). Do not submit your report.
Complete the simulation model for Paw Palace Pet Clinic to access the economic benefits to be obtained by hiring a veterinarian assistant:
Complete the formulas for waiting times and annual profit for a model with vet assistant in tab “Current and New Model C”. In @Risk, use Triangular distribution to simulate service times. Use 5, 15, and 35 minutes respectively as parameters.
Compute the change in annual profit to be obtained by hiring a veterinarian assistant. Designate the change in annual profit as an output in @Risk
Obtain distribution of the change in profit using 5000 iterations
Answer the following questions:
1. If Dr. Shulke were to hire vet assistant, hence, improving service time, how do outputs “1” – “4” in above (Assignment Week 3) change?
2. Analyze the distribution of the change in profit in terms of expected profit and risk (Hint: use percentiles and median).
3. What would customers perceive regarding wait times above, compared to before the new hire? Would the clinic be able to improve customer retention and grow business? Discuss pros and cons of hiring vet assistant.
