Waiting Lines and Queuing Theory Models

A Report i n Quanti tati ve Management
WAITING LINES AND

QUEUING THEORY
MODELS
Introduction
Waiting Line Costs
Characteristics of a Queuing System
Single-Channel Queuing Model with
Poisson Arrivals and Exponential Service
Times
Multichannel Queuing Model with Poisson
Arrivals and Exponential Service Times
CHAPTER OUTLINE
Queuing theory is the study of waiting lines
It is one of the oldest and most widely used
quantitative analysis techniques
Waiting lines are an everyday occurrence for
most people
Queues form in business process as well
The three basic components of a queuing
process are arrivals, service facilities, and
the actual waiting line
Analytical models of waiting lines can help
managers evaluate the cost and
effectiveness of service systems
INTRODUCTION
Most waiting line problems are focused on finding
the ideal level of service a firm should provide
In most cases, this service level is something
management can control
When an organization does have control, they often
try to find the balance between two extremes
A large staff and many service facilities generally
results in high levels of service but have high costs
WAITING LINE COSTS
Having the minimum number of service facilities
keeps service cost down but may result in
dissatisfied customers
There is generally a trade-off between cost of
providing service and cost of waiting time
Service facilities are evaluated on their total
expected cost which is the sum of service costs and
waiting costs
Organizations typically want to find the service level
that minimizes the total expected cost
WAITING LINE COSTS
Queuing costs and service level
WAITING LINE COSTS
*
Optimal
Service
Level
C
o
s
t

Service Level
Cost of Providing Service
Total Expected Cost
Cost of Waiting Time
Three Rivers Shipping operates a docking facility on
the Ohio River
An average of 5 ships arrive to unload their cargos
each shift
Idle ships are expensive
More staff can be hired to unload the ships, but that
is expensive as well
Three Rivers Shipping Company wants to determine
the optimal number of teams of stevedores to
employ each shift to obtain the minimum total
expected cost
THREE RIVERS SHIPPING COMPANY
EXAMPLE
Three Rivers Shipping waiting line cost analysis
THREE RIVERS SHIPPING COMPANY
EXAMPLE
NUMBER OF TEAMS OF STEVEDORES
WORKING
1 2 3 4
(a) Average number of ships arriving
per shift
5 5 5 5
(b) Average time each ship waits to
be unloaded (hours)
7 4 3 2
(c) Total ship hours lost per shift
(a x b)
35 20 15 10
(d) Estimated cost per hour of idle
ship time
$1,000 $1,000 $1,000 $1,000
(e) Value of ships lost time or waiting
cost (c x d)
$35,000 $20,000 $15,000 $10,000
(f) Stevedore team salary or service
cost
$6,000 $12,000 $18,000 $24,000
(g) Total expected cost (e + f) $41,000 $32,000 $33,000 $34,000
Optimal cost
There are three parts to a queuing system
1. The arrivals or inputs to the system (sometimes
referred to as the calling population)
2. The queue or waiting line itself
3. The service facility
These components have their own
characteristics that must be examined before
mathematical models can be developed
CHARACTERISTICS OF A QUEUING
SYSTEM
Arrival Characteristics have three major
characteristics, size, pattern, and behavior
Size of the calling population
Can be either unlimited (essentially infinite) or limited (finite)
Pattern of arrivals
Can arrive according to a known pattern or can arrive randomly
Random arrivals generally follow a Poisson distribution
SYSTEM
The Poisson distribution is
SYSTEM
4,... 3, 2, 1, 0, for = =

X
X
e
X P
X
!
) (

where
P(X) = probability of X arrivals
X = number of arrivals per unit of time
= average arrival rate
e = 2.7183
We find the values of e

If = 2, we can find the values for X = 0, 1, and 2
SYSTEM
!
) (
X
e
X P
X

=
% .
) ( .
!
) ( 14 1353 0
1
1 1353 0
0
2
0
0 2
= = = =

e
P
% .
) ( .
!
) ( 27 2706 0
1
2 1353 0
1
2
1
2
1
2 1 2
= = = = =

e e
P
% .
) ( .
) ( !
) ( 27 2706 0
2
4 1353 0
1 2
4
2
2
2
2 2 2
= = = = =

e e
P
Two examples of the Poisson distribution for
arrival rates
SYSTEM
0.30
0.25
0.20
0.15
0.10
0.05
0.00
P
r
o
b
a
b
i
l
i
t
y

= 2 Distribution
|
0
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
X
0.25
0.20
0.15
0.10
0.05
0.00
P
r
o
b
a
b
i
l
i
t
y

= 4 Distribution
|
0
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
X
Behavior of arrivals
Most queuing models assume customers are patient
and will wait in the queue until they are served and
do not switch lines
Balking refers to customers who refuse to join the
queue
Reneging customers enter the queue but become
impatient and leave without receiving their service
That these behaviors exist is a strong argument for
the use of queuing theory to managing waiting lines
SYSTEM
Waiting Line Characteristics
Waiting lines can be either limited or unlimited
Queue discipline refers to the rule by which
customers in the line receive service
The most common rule is first-in, first-out (FIFO)
Other rules are possible and may be based on
other important characteristics
Other rules can be applied to select which
customers enter which queue, but may apply
FIFO once they are in the queue
SYSTEM
Service Facility Characteristics
Basic queuing system configurations
Service systems are classified in terms of the number of channels,
or servers, and the number of phases, or service stops
A single-channel system with one server is quite common
Multichannel systems exist when multiple servers are fed by one
common waiting line
In a single-phase system the customer receives service form just
one server
If a customer has to go through more than one server, it is a
multiphase system
SYSTEM
Four basic queuing system configurations
SYSTEM
Single-Channel, Single-Phase System
Arrivals
Departures
after Service
Queue
Service
Facility
Single-Channel, Multiphase System
Arrivals
Departures
after
Service
Queue
Type 1
Service
Facility
Type 2
Service
Facility
SYSTEM
Multichannel, Single-Phase System
Arrivals
Queue
Service
Facility
1
Departures
after
Service
Facility
2
Service
Service
Facility
3
SYSTEM
Multichannel, Multiphase System
Arrivals
Queue
Departures
after
Service
Type 2
Service
Facility
1
Type 2
Service
Facility
2
Type 1
Service
Facility
2
Type 1
Service
Facility
1
Service time distribution
Service patterns can be either constant or random
Constant service times are often machine
controlled
More often, service times are randomly distributed
according to a negative exponential probability
distribution
Models are based on the assumption of particular
probability distributions
Analysts should take to ensure observations fit the
assumed distributions when applying these models
SYSTEM
Two examples of exponential distribution for
service times
SYSTEM
f (x) = e
x

for x 0
and > 0

= Average Number Served per Minute
Average Service Time of 1 Hour
Average Service Time
of 20 Minutes
f (x)
Service Time (Minutes)
|
0
|
30
|
60
|
90
|
120
|
150
|
180

D. G. Kendall developed a notation for queuing
models that specifies the pattern of arrival, the
service time distribution, and the number of
channels
It is of the form
IDENTIFYING MODELS USING
KENDALL NOTATION
Specific letters are used to represent probability
distributions
M = Poisson distribution for number of occurrences
D = constant (deterministic) rate
G = general distribution with known mean and variance
Arrival
distribution
Service time
distribution
Number of service
channels open
So a single channel model with Poisson arrivals
and exponential service times would be
represented by
M/M/1
If a second channel is added we would have
M/M/2
A three channel system with Poisson arrivals and
constant service time would be
M/D/3
A four channel system with Poisson arrivals and
normally distributed service times would be
M/G/4
IDENTIFYING MODELS USING
KENDALL NOTATION
Assumptions of the model
Arrivals are served on a FIFO basis
No balking or reneging
Arrivals are independent of each other but rate is
constant over time
Arrivals follow a Poisson distribution
Service times are variable and independent but
the average is known
Service times follow a negative exponential
distribution
Average service rate is greater than the average
arrival rate
SINGLE-CHANNEL MODEL, POISSON
ARRIVALS, EXPONENTIAL SERVICE TIMES
(M/M/1)
When these assumptions are met, we can
develop a series of equations that define the
queues operating characteristics

Queuing Equations
We let
(M/M/1)
= mean number of arrivals per time period
= mean number of people or items served
per time period
The arrival rate and the service rate must be
for the same time period
1. The average number of customers or units in the
system, L
(M/M/1)

= L
2. The average time a customer spends in the
system, W
3. The average number of customers in the queue, L
q

=
1
W
) (

=
2
q
L
4. The average time a customer spends waiting in
the queue, W
q

(M/M/1)
) (

=
q
W
5. The utilization factor for the system, , the
probability the service facility is being used
=
6. The percent idle time, P
0
, the probability no one
is in the system
(M/M/1)
= 1
0
P
7. The probability that the number of customers in
the system is greater than k, P
n>k
1 +
>
|
.
|
\
|
=
k
k n
P
Arnolds mechanic can install mufflers at a rate

of 3 per hour
Customers arrive at a rate of 2 per hour
= 2 cars arriving per hour
= 3 cars serviced per hour
ARNOLDS MUFFLER SHOP CASE
2 3
1 1
=

W = 1 hour that an average car
spends in the system
1
2
2 3
2
=
=

L = 2 cars in the system
on the average
hour
3
2
=
=
) (

q
W = 40 minutes average
waiting time per car
) ( ) ( ) ( 1 3
4
2 3 3
2
2 2
=
=

q
L = 1.33 cars waiting in line
on the average
67 0
3
2
. = = =
= percentage of time
mechanic is busy
33 0
3
2
1 1
0
. = = =
P = probability that there

are 0 cars in the system
Probability of more than k cars in the system
k P
n>k
= (
2
/
3
)
k+1
0 0.667 Note that this is equal to 1 P
0
= 1 0.33 = 0.667
1 0.444
2 0.296
3 0.198 Implies that there is a 19.8% chance that more
than 3 cars are in the system
4 0.132
5 0.088
6 0.058
7 0.039
Introducing costs into the model
Arnold wants to do an economic analysis of the
queuing system and determine the waiting cost
and service cost
The total service cost is
Total
service cost
=
(Number of channels)
x (Cost per channel)
Total
service cost
= mC
s
where
m = number of channels
C
s
= service cost of each channel
Waiting cost when the cost is based on time in
the system
Total
waiting cost
= (W)C
w
Total
waiting cost
=
(Total time spent waiting by all
arrivals) x (Cost of waiting)
=
(Number of arrivals) x
(Average wait per arrival)C
w
If waiting time cost is based on time in the queue
Total
waiting cost
= (W
q
)C
w
So the total cost of the queuing system when
based on time in the system is
Total cost = Total service cost + Total waiting cost
Total cost = mC
s
+ WC
w
And when based on time in the queue
Total cost = mC
s
+ W
q
C
w
Arnold estimates the cost of customer waiting
time in line is $10 per hour
Total daily
waiting cost
= (8 hours per day)W
q
C
w

= (8)(2)(
2
/
3
)($10) = $106.67
Arnold has identified the mechanics wage $7 per
hour as the service cost
Total daily
service cost
= (8 hours per day)mC
s

= (8)(1)($7) = $56
So the total cost of the system is
Total daily cost of
the queuing system
= $106.67 + $56 = $162.67
Arnold is thinking about hiring a different mechanic
who can install mufflers at a faster rate
The new operating characteristics would be
= 2 cars arriving per hour
= 4 cars serviced per hour
2 4
1 1
=

W = 1/2 hour that an average car
spends in the system
2
2
2 4
2
=
=

L = 1 car in the system
on the average
hour
4
1
=
=
) (

q
W = 15 minutes average
waiting time per car
) ( ) ( ) ( 1 8
4
2 4 4
2
2 2
=
=

q
L = 1/2 cars waiting in line
on the average
5 0
4
2
. = = =
= percentage of time
mechanic is busy
5 0
4
2
1 1
0
. = = =
P = probability that there

are 0 cars in the system
Probability of more than k cars in the system
k P
n>k
= (
2
/
4
)
k+1
0 0.500
1 0.250
2 0.125
3 0.062
4 0.031
5 0.016
6 0.008
7 0.004
The customer waiting cost is the same $10 per
hour
Total daily
waiting cost
= (8 hours per day)W
q
C
w

= (8)(2)(
1
/
4
)($10) = $40.00
The new mechanic is more expensive at $9 per
hour
Total daily
service cost
= (8 hours per day)mC
s

= (8)(1)($9) = $72
Total daily cost of
the queuing system
= $40 + $72 = $112
The total time spent waiting for the 16
customers per day was formerly
(16 cars per day) x (
2
/
3
hour per car) = 10.67
hours
It is now is now
(16 cars per day) x (
1
/
4
hour per car) = 4 hours
The total system costs are less with the new
mechanic resulting in a $50 per day savings
$162 $112 = $50
Reducing waiting time is not the only way to
reduce waiting cost
Reducing waiting cost (C
w
) will also reduce
total waiting cost
This might be less expensive to achieve than
reducing either W or W
q
ENHANCING THE QUEUING ENVIRONMENT
Assumptions of the model
Arrivals are served on a FIFO basis
No balking or reneging
Arrivals are independent of each other but rate is
constant over time
Arrivals follow a Poisson distribution
Service times are variable and independent but
the average is known
Service times follow a negative exponential
distribution
Average service rate is greater than the average
arrival rate
MULTICHANNEL MODEL, POISSON
(M/M/M)
Equations for the multichannel queuing model
We let
(M/M/M)
m = number of channels open
= average arrival rate
= average service rate at each channel
1. The probability that there are zero customers in
the system

>
|
.
|
\
|
+
(
(
|
.
|
\
|
=
=
=
m
m
m
m n
P
m
m n
n
n
for
1 1
1
1
0
0
! !
2. The average number of customer in the system
(M/M/M)

+

=
0
2
1
P
m m
L
m
) ( )! (
) / (
3. The average time a unit spends in the waiting line
or being served, in the system

L
P
m m
W
m
= +

=
1
1
0
2
) ( )! (
) / (
4. The average number of customers or units in line
waiting for service
(M/M/M)
= L L
q
waiting for service
waiting for service

q
q
L
W W = =
1
m
=
Arnold wants to investigate opening a second
garage bay
He would hire a second worker who works at the
same rate as his first worker
The customer arrival rate remains the same
ARNOLDS MUFFLER SHOP
REVISITED

>
|
.
|
\
|
+
(
(
|
.
|
\
|
=
=
=
m
m
m
m n
P
m
m n
n
n
for
1 1
1
1
0
0
! !
5 0
0
. = P
= probability of 0 cars in the system
Average number of cars in the system
REVISITED
75 0
1
0
2
.
) ( )! (
) / (
= +

=

P
m m
L
m
minutes
2
1
22 hours
8
3
= = =
L
W
Average time a car spends in the system
Average number of cars in the queue
REVISITED
Average time a car spends in the queue
083 0
12
1
3
2
4
3
. = = = =
L L
q
minutes
2
1
2 hour 0.0415
2
083 0 1
= = = = =
.

q
q
L
W W
Effect of service level on Arnolds operating
characteristics
REVISITED
LEVEL OF SERVICE
OPERATING
CHARACTERISTIC
ONE
MECHANIC
= 3
TWO
MECHANICS
= 3 FOR BOTH
ONE FAST
MECHANIC
= 4
Probability that the system
is empty (P
0
)
0.33 0.50 0.50
Average number of cars in
the system (L)
2 cars 0.75 cars 1 car
Average time spent in the
system (W)
60 minutes 22.5 minutes 30 minutes
Average number of cars in
the queue (L
q
)
1.33 cars 0.083 car 0.50 car
Average time spent in the
queue (W
q
)
40 minutes 2.5 minutes 15 minutes
Table 14.2
Adding the second service bay reduces the
waiting time in line but will increase the service
cost as a second mechanic needs to be hired
REVISITED
Total daily waiting cost = (8 hours per day)W
q
C
w

= (8)(2)(0.0415)($10) = $6.64
Total daily service cost = (8 hours per day)mC
s

= (8)(2)($7) = $112
Total system cost = $6.64 + $112 = $118.64
The fast mechanic is the cheapest option

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A Report i n Quanti tati ve Management

WAITING LINES AND

Arnolds mechanic can install mufflers at a rate

P = probability that there

P = probability that there

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