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Fault Tree and Cost-Benefit Analysis for a Warehouse

Summary and Learning Objectives 

COOKMATE Co. owns a warehouse that carries and distributes products to the retailers downstream.  An accident happened recently where one of the forklifts hit an employee. The company’s management has decided to analyze the probability of such accidents and explore possible ways to reduce the chance of an accident and associated costs.  You are hired to perform this analysis. 

After successful completion of this Immersive Simulation-Based Learning (I-SBL) module, the student will be able to: 

  1. Create an appropriate fault tree for an event.
  2. Compute the probability of an event using fault tree analysis. 
  3. Compute the costbenefit ratio using a set of cost estimates and event probability values estimated via fault tree analysis. 
  4. Compare a set of alternatives based on their costbenefit ratio and make an appropriate recommendation accordingly. 

Keywords 

Fault tree analysis, occupational safety, probability, union and intersection of events, costbenefit analysis, warehouse 

Discipline(s): 

Industrial Engineering; Safety Engineering; Operations Research 

Potential related courses/topics 

Workspace Design; Production and Safety; Safety Engineering; Engineering Economy; Probability Theory 

Recommended educational level and audience 

Undergraduate; Introductory, nonmajors or majors 

Prerequisites 

Familiarity with fault tree analysis, costbenefit analysis, basic probability relations and events, and basic math. 

Necessary student resources 

Textbook/handout: Costbenefit analysis. 

Software/hardware: A computer with Simio installed on it. 

Immersion level 

The module supports both “low-immersion” (3D view on a typical display) and “high-immersion” (virtual reality using an Oculus Rift VR headset). 

Can it be used as a traditional PBL module without the immersive simulation model? 

Yes.  All parts of this module can be answered without having access to the immersive simulation model.  The simulation is intended to serve as the “context” to help students visualize the system under study. 

Recommended timeframe and activity format 

Total time: 40 minutes (Part 1: 15 minutes; Part 2: 25 minutes)
Can be done as in-class activity or homework assignment.
Can be done in groups or individually. 

Download module material (problem description and immersive simulation model) 

Students:
Problem description – Version 1
Problem description – Version 2
Simulation model (Simio file) – Desktop Version – Low Immersion
Simulation model (Simio file) – Virtual Reality Version – High Immersion 

Instructors: Click here to request access to instructor copy. 

Published inComputer ScienceIndustrial EngineeringOperations ResearchSafety EngineeringVR Based

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