Question: Davis Instruments has a manufacturing plant located in Atlanta Georgia. Product demand varies considerably from month to month, causing Davis extreme difficulty in workforce scheduling. Recently, Davis started hiring temporary workers supplied by WorkForce Unlimited, a company that specializes in providing temporary employees for the firms in greater Atlanta area. WorkForce Unlimited has offered to provide temporary employees under three contract options that differ in terms of length of employment and the cost per month. The three options are summarized below:

Option Length of Employment Cost per Month

i One month $2000

ii Two months $2400

iii Three months $2500

The longer contract periods are more expensive because WorkForce Unlimited has greater difficulty in finding temporary workers who are willing to commit to longer work assignments. Each month, Davis can therefore hire any number of workers on a one month, two month, or three month contract. For example, as shown in the table below, if Davis hires M1 workers in May on a one month contract, these M1 workers will be available to Davis only in May (denoted by 1 in May for column M1). In contrast, if Davis hires JN3 workers in June on a three month contract, these workers will be available to Davis in each of the following three months – June, July, and August ( as denoted by 1 in June, July, and Aug in Column JN3). Table below lists all the options Davis has.

Over the next five months, Davis has projected the following needs for additional employees.

Each month, Davis can hire as many temporary employees under each of the three options. Because of the ongoing merger negotiations, Davis does not want to commit to any contractual obligation beyond September.

Davis has a quality control problem that requires each temporary employee to receive training at the time of hire. The training is required if the person had worked for Davis in the past. It is estimated that the training cost is $875 each time a temporary worker is hired. Thus, if an employee is hired under option 2, the cost will be 875 + 2*2400 = $5675, whereas cost under option 3 will be 875+ 3*2500 = $8375, and option 1 will be 875 + 2000 = $2875.

Develop a mathematical workforce planning model for Davis that decide how many each month will be hired under each of the contract options so that total cost is minimized.

Price: $2.99

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