According to the case, Kristen’s cookie company needs 26 minutes to fulfill a rush order because it combines the time for washing/mixing, spooning, setting time, baking, cooling, packing and receiving payment. More specifically, Kristen spends 8 minutes on washing/mixing and spooning and the roommate spends 4 minutes on setting, packing and receiving payment. In four hours, which are 240 minutes, Kristen can fill 24 consecutive orders in maximum because the bottleneck is ten-minute baking.
Since variable costs on ingredients and boxes are the same, variable labor time are spooning and packing. One dozen order takes 12 minutes and it takes 4 more minutes to finish one extra dozen.
Since electric mixer can hold three dozen cookies, one mixer is enough. Three trays are needed for spooning, baking and cooling.
The bottleneck is baking because of the lowest 0.1 dozen/min. If one more oven is added, then bottleneck would be 0.2 dozen/min and the maximum rental expense would be 240/10*($0.6+$0.1) = $16.8.
If Kristen do everything by himself, there is nothing changing if all orders are not consecutive because components requiring labor time are not overlapped. However, when orders are consecutive, washing/mixing and packing/receiving payment are conflicted and all other steps are delayed.
In order to raise efficiency, one component in the process can be eliminated, which is receiving payment. By using the Kristen can let customers pay online when ordering cookies so that 1 minute is saved.
If cookies are standard instead, then Kristen is able to start before orders come in because the product is predictable. Meanwhile, order-taking process and pricing system will be simplified by asking customers how many dozens are needed.