Amazon ACE Challenge 2016

Customer Support and World Wide Capacity Planning

(Answer to this part of the case should be within 500-1000 words)

Customer Service is the primary touch point for helping Amazon customers with both pre-order and postorder questions as well as the major intake mechanism for any feedback related to Amazon. It serves as
a vital cog in the Amazon Supply chain for capturing Customers' voice as well as being a starting point in
its journey to become the earth's most customer centric company. Amazon customer service has its
employee footprint across a network of sites around the world and capacity planning for this network
spread across geographies, languages and skillsets in a centralized and optimal fashion. This ensures
uninterrupted 24x7 coverage, poses an interesting challenge to solve for.
The Supreme Chancellor of the Galactic Empire will be delivering a secure broadcast to the people within
the empire. Amazon is expected to supply for the requirements for this event (a peak event). Amazon
Customer Service operates at a Contact Rate1 of 50% for each unit shipped out of Fulfillment Centers (FC)
each week. Because of sale the business expects to sell additional 100,000 holoprojectors for
communication during the sale week. Processing capacity across all Amazon India FCs is 50,000
holoprojectors each week. Assume weekly charge (incoming units demand) to Amazon FCs in a non-sale
week is 50,000 and the processing capacity across all Amazon FCs goes up by 50% during and after the
sale week.
For customer service team comprising of Jedi, the regular (non-peak) call arrival pattern is determined
by an Intra-Day pattern and Intra-Week pattern as provided in Appendix. The average time to handle
these calls can be assumed to be 10 min. Assuming, we will receive 20% of the weeks contacts on the
sale day (which happens to be a Wednesday), build a shift plan (sample shift plan attached in Appendix)
for 3 scenarios: Average Speed to Answer calls is 30s, 60s and 90s respectively in each interval (60 min
intervals). You also have the option of enrolling star troopers on contract but that may also have an
impact on quality metrics. Estimate the impact on Cost and customer experience (quality metrics MCI
mentioned later). One can assume that Jedi & star troopers have an ability to work for 12 hours/day for
4 days in a week.
Additionally, lead time to hire and onboard Full-time Jedi or star troopers is anywhere between 15-16
weeks (Hiring lead-time of 7-8 weeks and Training lead-time of 5-6 weeks). This is effectively the time to
productivity once a decision to onboard fresh capacity has been made. The Supreme Chancellor has asked
R2-D2 to come up with a disruptive hiring and onboarding strategy which has a lead-time of 6 weeks to
productivity. Is that even possible?
Quality of service provided by CS Jedi is gauged through Hows My Force (HMF) email which is sent to
customers after they have contacted Amazon. The metric used to gauge quality is MCI (Midi-chlorian
Index) i.e. % customers who respond that their issue was resolved by Amazon CS. There are two issues
which we have noticed with regard to MCI:
1. Low response rate to the HMF email i.e. % customers who respond to the HMF feedback email

Contact Rate The number of contacts generated per unit shipped out

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Amazon ACE Challenge 2016

2. Low MCI Index for associates with tenure < 2 months & cross skilled Jedis
Estimate the impact on MCI during the peak week due to new Jedis who are part of the system. Are
there any additional factors which you think will worsen the MCI? What is the estimated impact? Can
you think of strategies to improve the response rate to HMF email sent to our customers? Voice of
customer surveys have also revealed customers frustration with not being responded within expected
timeframes.
Note: Please refer Appendix 1 -4 for the above part of the case

(Amazon Business Service) ABS Peak Load Management for Andon Cord
Due to the broadcast, there is an increase in complaints to customer service and request for return due
to damaged holoprojectors or product description mismatch. Customer Service team pulls down the
holoprojectors from selling on Amazon website and raise a new case to ABS Andon Cord team (Appendix
5) when 2 or more complaints are received against same item.
Andon Cord team analyzes defects, contact internal teams and vendors to resolve the root cause. The
item is not sold unless the root cause is resolved. The Andon Cord teams provide support to Corellia,
Naboo, Kamino and Coruscant Marketplaces. The team members working for Naboo and Kamino are
trained on respective languages as the issues require knowledge in Naboo and Kaminoan. The other 2
planets have English as their primary language.
The team is trying to determine expected inflow after the sale week in next three months: Dec, Jan and
Feb (Appendix 6). The increased inflow increases Turnaround time of the resolution. On an average one
day delay in resolving a case lead to $1000 loss in sales.
At present, there is no cross utilization happening across teams. There is feasibility to train resources from
other teams (New Item Setup) on Andon Cord resolution process. Cost of cross training English, Naboo
and Kaminoan resources are $400, $800 and $ 1000 respectively. Annual cost of English, Naboo and
Kaminoan resources are $10000, $15000 and $20000 respectively. However, productivity of cross trained
resource is 50% of a permanent resource. The team has implemented a new process in 2016 to measure
Re-opened cases (Repeat pulls) which is indication of quality. It is observed that cross training impacts
the quality of resolution and repeat pull is higher for cross trained resources by 30%.

ABS leader Master Yoda is planning to reduce TAT during peak load and balancing requirement of new
resources by cross training resources across functions. He has asked operations manager to propose
resolution of the followings:
1. Design a forecasting model explaining expected inflow during peak load time including Q12017.
(Limit your answer within 500 words. Attach excel as an appendix name ABS if you need to)

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Amazon ACE Challenge 2016

2. Propose a resource model including both cross trained resource and permanent resource in the
team. Consider cost minimization and quality optimization, the model should.
(Limit your answer within 500 words. Attach excel as an appendix name ABS if you need to)

TRMS
Transaction Risk Management Systems (TRMS) is the heart of customer trust. When a customer places
an order, TRMS ensures that they receive what they have ordered, in the condition they expected, in a
timely fashion. When a third-party seller creates an offer to sell an item, TRMS ensures that their
competitors follow the same rules they do, and that when the order is placed they receive the money
they have earned. In addition, TRMS is responsible for minimizing the cost to Amazon for these
guarantees; our impact on the bottom line is the equivalent of billions of dollars of sales. The team
leverages a mix of risk analysis techniques, from machine learning models generated from massive
(petabyte) data sets to manual analysis by trained, high-judgment investigators. TRMS comprises of
many departments which operates with the help of its Jedi Army to detect fraud carried out frequently
by the Sith, monitor trader performance, and enforce marketplace requirements to reduce the amount
of bad debt that we get due to fraudulent activities.
TRMS operates to support all businesses. So, when the broadcast day was announced in the Galactic
Empire, the amount of trade will increase and TRMS has to increase its army of Jedi Knights to protect
the people and traders from the menacing Sith from scamming people. TRMS has employed machine
learning models which clears some portion of the transactions based on historical data analysis, leaving
rest for our Jedi Knights. The current volume of cases being solved by Jedi is around 10000 per week,
refer to appendices. During peak days the volume increases by a minimum of 100%. The forecast for the
requirement on the broadcast is same. On normal days, the current Jedi Army has the capacity to deal
with the cases themselves. Capacity trends are given in the appendices.
TRMS Jedi Knights can investigate 12 cases per hour and work for 8 hours on a regular day. They can
harness the power of the Force and work overtime when required. During peak periods, the Jedi council
can also employ Stormtroopers, but they work a little slower than Jedi Knights at 8.5 tasks per hour. The
Jedi Council has called for a meeting to come up with a plan for the broadcast. They have nominated
Jobhi Wan, the newest addition to Jedi Army, to come up with a solution. Jobhi Wan has 3 ways to deal
with the problem of high incoming cases during peak:
1. He can lead his current army of Knights and work extra hours to deal with the high incoming.
Though they are rewarded for their bravery with extra payout, it might put stress on the Knights
due to constant use of the power of Force to extend themselves regularly.
2. Jobhi can recruit new Jedi Knights. He has to plan this recruitment drive in advance for the peak
period as there is a lead time of 14 weeks (training time + on field missions also known as ramp
period) until they can fully control the force to deal with the Sith and his army effectively.
Details given in appendices.
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Amazon ACE Challenge 2016

3. Jobhi Wan can use the help from the storm troopers of the Imperial army. They are not
accustomed to the problems and the way Sith attacks so it takes some time for them to deal
with the particular cases. If they try to work faster, then quality of service might deteriorate.
Hence, Jobhi Wan has to plan separate refresher sessions for them, handle logistic issues like
transportation, shift-timing and cross-department transaction costs.
He also has one more way of increasing capacity improving the efficiency of his Jedi Knights. Some Jedi
Knights are known to free ride on other Jedi Knights efforts. He can work closely with other masters to
improve this behavior and put incentives so every Knight can perform more than their potential.
1. Help Jobhi Wan in selecting the best way to manage the peak period by suggesting the right mix
to fulfill capacity gap. As per the directions of the Supreme Chancellor, Jobhi has to optimize
costs while meeting the gap.
(Answer to this should be in the form of an Excel doc named TRMS)

2. Master Yoda is one with the Force and he predicts recurring occurrences of such events in the
future. He says, Jobhi Wan, take we must, a long term approach and prepare we should, a
model which can be adjusted according to peak requirements, which might be for a single day
or could even last for a month.
(Answer to this should be within 150 words on how to scale the model to include peaks and short spikes)

Note: Please refer to Appendix 7-10 for the above portion of the case
Fulfillment Centre (FC)
In Amazon network, Fulfillment Centers (FCs) store all the material which are later packed and delivered
on tight timelines to customers as per their demand. Along with delivering timely orders to customers as
per varying seasonal demand, FCs work closely with ABS and CS teams in analyzing and addressing root
cause of any customer complaint for receiving a product in undesired condition.
As Master Yoda said that we need to plan for more than a day, the FC experiences multiple peaks in year
(holoprojectors now, Form II lightsabers during intergalactic saber sports etc). This calls for dynamic
manpower planning for troopers working in FCs. Once spike in volume (peak) is over, this hired trooper
becomes idle and results in cost burden to the empire. On other hand, hiring/de-hiring Stromtroopers on
a very short cycle also impacts cost because of learning curve impact of newly hired trooper (thus lesser
productivity), cost of quality and cost of hiring/de-hiring. Mace Windu is leading this effort and his
objective is to fulfill 100% expected volume and minimize overall cost to the organization.
Gross weekly expected volume from various FCs across the empire is in Appendix 12 and months where
spike in customer orders is expected have been highlighted in blue in Appendix 11. As presented in the
table FC sees a surge in volume to the tone of 3X during peak weeks as compared to non-peak weeks.

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Amazon ACE Challenge 2016

A seasoned Stormtrooper productivity is estimated at 35 units per hour and productivity of an associate
increases with his/her work experience which directly depend on hiring plan prior to peak event.
Productivity curve can be explained as in Appendix 13:
For each 9 work hours, a trooper during his training time (till the new trooper has spent 40 hours in
system) requires at least 1 hour of an experienced trooper for monitoring and training purposes. During
this training time, experienced trooper is allocated dedicatedly to training purposes thus he/she cant
participate in direct processing of customer orders. Hiring and de-hiring of each trooper incurs $15 and
each hour cost of a trooper is $4. Along with this, each trooper also injects some defects which are directly
dependent on hours which he/she spends in system and requires additional hours for cleaning these
defects.
Appendix 14 summarizes % of hours spend by a trooper which are required for cleansing of defects
created. For example, if a trooper just joined (< 40 hours in system) then for 100 hours worked by this
trooper, Mace Windus team will need to invest additional 15 hours for cleaning defects.
Potential levers available also include overtime (OT) for troopers, where troopers earn double their
normal rates. Any trooper can work for a maximum of 54 hours in a week which includes 9 hours of OT.
Without OT maximum hours a trooper can work in a given week is 45.
Question:
Help Mace, devise a realistic ramp-up and ramp-down model with overall objective of fulfilling 100%
expected volume and minimizing overall cost. (Overall costs include cost of quality i.e. cleaning defects
introduced in the system, troopers wages, hiring/de-hiring cost, training cost etc.)
(Answer to this should be within 300 words)

MAY THE FORCE BE WITH YOU

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Amazon ACE Challenge 2016

Appendices
Appendix 1
Intraday Pattern
Day Interval
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23

Intraweek Pattern

% Total Contacts in the interval

2.7%
2.0%
1.5%
1.2%
1.0%
1.2%
2.0%
2.8%
3.8%
4.7%
5.4%
5.8%
6.1%
6.1%
6.1%
6.1%
6.0%
5.9%
5.8%
5.6%
5.4%
4.9%
4.3%
3.6%

Day
Sunday
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday

Distribution
5%
18%
18%
18%
18%
18%
5%

Sample Shift Plan

Login Interval

# Associates
for the Login

8 AM

150

3 PM

200

8 PM

100

2 AM

50

Appendix 2
Customer Issue
Issue
Wheres My Order enquiries
Returns
Refunds
Payments
Order Cancellation
Non Order
Overall

Amazon Confidential

% Total Contacts
30%
20%
20%
20%
5%
5%
100%

MCI
70%
85%
95%
85%
90%
99%
83%

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Amazon ACE Challenge 2016

Appendix 3
MCI by tenure

MCI by associate

Associate
Tenure
<6 weeks
6-8 weeks
>8 weeks

NRR
75%
80%
83%

Associate
Type
Jedi
Star Trooper

NRR
83%
77%

Appendix 4
Hiring cost by associate
Associate Type
Jedi
Star Trooper

Monthly associate salary

Cost
5,000
3,000

Associate Type
Jedi
Star Trooper

Cost
50,000
30,000

Appendix 5:
Retail business Services (ABS) Andon Team:
Andon Cords occur as a result of customer contacts that have indicated that there could be a serious
defect with the product. As a result, Customer Service (CS) will halt sales on an item by pulling the Amazon
Buy box down from the site. This deters additional poor customer experiences and allows ABS time to
investigate the potential customer-facing issue. ABS works to resolve these issues with the assistance of
the vendors and retail business team. When a CS Jedi notices a potential serious defect in the product
being shipped out, she/he initiates an Andon Cord. At this time, the Buy box is suppressed and the product
is now not buyable. A Sev-3 ticket is cut to notify the retail teams of this potential customer-facing issue.
The goal is to prevent future customers from buying a product that has a CS-identified defect trend. In
addition, ABS will immediately provide all available information to the appropriate retail team so the root
cause can be identified as quickly as possible.

Appendix 6:
Year

Month

2015
2015
2015
2015
2015
2015
2015

Jan
Feb
Mar
Apr
May
Jun
Jul

Inflow
Tickets
4672
3608
3842
3862
3110
2998
3192

Amazon Confidential

Naboo
Open Ticket Avg. TP 90
Count
TAT
TAT
846
6.47
21.8
620
6.73
25.8
878
6.32
22.7
1122
8.65
22.8
778
7.99
23.4
638
6.01
23.7
544
4.85
22.1

Completely Res
Tickets Productivity
12.09
12.21
13
11.77
11.3
11.83
11.97

Repeat
Rate

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Amazon ACE Challenge 2016

2015
2015
2015
2015
2015
2016
2016
2016
2016
2016
2016
2016

Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul

Year

Month

2015
2015
2015
2015
2015
2015
2015
2015
2015
2015
2015
2015
2016
2016
2016
2016
2016
2016
2016

Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul

Year

Month

2015
2015
2015
2015
2015
2015
2015

Jan
Feb
Mar
Apr
May
Jun
Jul

3350
3502
3504
3652
4162
4062
3776
3458
3412
3344
3476
2478
Inflow
Tickets
2724
1988
1750
1642
1274
1434
1584
1628
1516
1496
1640
2240
2028
2002
1696
1692
1820
1880
1262

Inflow
Tickets
4732
4178
4186
3912
3282
3264
3150

Amazon Confidential

668
512
646
708
750
1050
824
602
752
716
848
1382
Open Ticket
Count
498
196
396
422
270
262
254
324
262
264
312
448
454
328
310
270
388
364
632

4.71
24.4
5.06
16.2
5.25
17.3
5.33
11.7
4.86
5.02
4.6
19.8
4.92
23.8
5.01
18.9
5.57
27.9
5.7
28.9
6.19
28.9
Kamino
Avg. TAT TP 90
TAT
7.04
17.1
6.7
24.5
6.73
17.4
7.54
18.9
8.52
25.9
8.95
27.1
8.37
8.8
4.72
15.9
5.13
19.3
4.61
17.7
4.89
25.8
4.99
5.82
5.26
19.3
5.35
25.3
5.27
29.4
6.42
27.7
6.05
31
7.18
35.7

Open Ticket
Count
802
634
976
926
742
652
468

Coruscant
Avg.
TAT
4.7
4.11
4.14
4.31
4.37
4.56
4.73

12.56
12.82
13.14
13.3
13.35
12.24
13.81
13.39
13.16
12.36
12.24
15.74
Completely Res
Tickets Productivity
12.05
12.2
12.47
11.61
11.03
11.6
11.45
12.82
13.12
12.87
13.36
13.49
12.36
13.36
12.85
12.74
12.56
11.05
13.96

TP 90
TAT
13.8
16.7
13.8
13.6
16.2
15.1
15

Completely Res
Tickets
Productivity
9.76
8.82
9.9
9.79
9.15
8.65
9.34

14.82%
13.27%
14.68%
16.23%
Repeat Rate

21.71%
22.12%
20.93%
23.74%

Repeat
Rate

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Amazon ACE Challenge 2016

2015
2015
2015
2015
2015
2016
2016
2016
2016
2016
2016
2016

Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul

Year

Month

2015
2015
2015
2015
2015
2015
2015
2015
2015
2015
2015
2015
2016
2016
2016
2016
2016
2016
2016

Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul

3070
2810
2766
3182
3774
3708
3564
3342
3194
3260
3366
2520

600
478
464
558
680
766
574
526
532
674
588
1150

4.66
4.58
4.29
3.84
4.65
4.48
4.44
5.07
4.8
4.54
5.89
5.05

Inflow
Tickets
12978
11950
14634
13048
11932
11902
11770
12514
10978
11908
13602
13246
14428
15514
17988
16726
16278
16160
12150

Open Ticket
Count
1750
1848
1992
1776
2192
1762
1888
2236
1736
1706
1732
2000
2932
3132
2840
2402
2804
2682
4696

Corellia
Avg.
TAT
7.35
5.99
6.14
8.02
8.06
5.81
5.4
5.05
5.27
4.94
4.41
4.24
4.13
3.88
4
4.04
5.23
5.7
5.4

13.9
11.9
14.8
11.6

14.8
13.5
7.4
11.8
11.3
13.9

TP 90
TAT
33.8
32.3
17.5
19.7
20.2
23.2
30.9
26.9
20.6
22.7
15.3

16.4
23.7
25
21.2
20.1
23

10.45
10.72
10.34
12.52
10.92
11.99
12.85
12.57
13.47
12.87
9.97
12.93

Completely Res
Tickets Productivity
12.4
12.19
12.96
11.74
11.39
11.76
11.7
12.29
12.84
13.07
13.43
13.44
12.55
13.77
13.31
13.31
12.3
11.28
13.84

26%
25.60%
27.56%
27.92%

Repeat Rate

15.37%
14.38%
17.45%
15.70%

Appendix 7
Weekly incoming volume (current and projections)
Wk 25
10,120

Wk 26
8,973

Current Trends
Wk 27 Wk 28
11,546 11,039

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Wk 29
9,888

Wk 30
10,981

Peak-3
12,121

Peak-2
13,827

Peak Volume Forecasts

Peak-1
Peak
Peak+1
17,389 19,311 16,423

Peak+2
14,189

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Peak+3
11,776

Amazon ACE Challenge 2016

Current weekly capacity (Total Tenured Jedi Knights) in the TRMS Network without any
hiring/Overtime
Wk 25
9,345

Current Trends
Wk 27 Wk 28
10,020 9,681

Wk 26
9,730

Wk 29
8,829

Wk 30
9,889

Appendix 8
Productivity
Jedi Knights
Regular shift
OT Hours 1st Hr
OT Hours 2nd Hr
Stormtroopers

Tasks/Hour
12
12
11
8.5

Appendix 9
Costs for hiring Jedi Knight v/s training Stormtroopers

Cost/Jedi Knight/Hr
Shift Type
Regular Hr.
OT Hr
Stormtroopers

Army Type
Jedi Knights
Stormtroopers

CPI
46.15$
1.5x
46.15$

Cost
4615$
3692$

Appendix 10
Training and Productivity ramp of new hire Jedi Knights vs cross-skilled Stormtroopers
Army Type
Jedi Knights
Stormtroopers

Training Duration
4 Weeks
2 Weeks

Ramp Duration
10 Weeks
4 Weeks

Ramp Productivity targets

Army Type
Jedi Knights
Stormtroopers

W1
1.2
3.0

W2
2.4
6.0

W3
3.6
9.0

W4
4.8
12.0

W5
6.0
12.0

W6
7.2
12.0

W7
8.4
12.0

W8
9.6
12.0

W9
10.8
12.0

W10
12.0
12.0

Jul

Aug

Appendix 11
Jan

Feb

Mar

Apr

May

Jun

Sep

Oct

Nov

Volume

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Dec

Amazon ACE Challenge 2016

Appendix 12
Gross Weekly Expected Volume (in '10,000 units)
Week No

Vol

Week No

Vol

Week No

Vol

Week No

Vol

Week No

Vol

Week No

Vol

WK01

2601

WK11

406

WK21

839

WK31

5697

WK41

7342

WK51

1302

WK02

2391

WK12

204

WK22

3152

WK32

5257

WK42

6944

WK52

876

WK03

2163

WK13

2872

WK23

2878

WK33

4785

WK43

5714

Wk53

442

WK04

1835

WK14

2636

WK24

2616

WK34

4457

WK44

5090

WK05

1628

WK15

2414

WK25

2341

WK35

4121

WK45

4234

WK06

1419

WK16

2191

WK26

2069

WK36

3755

WK46

3640

WK07

1216

WK17

1966

WK27

1773

WK37

3364

WK47

2960

WK08

1013

WK18

1706

WK28

1483

WK38

2941

WK48

2552

WK09

812

WK19

1413

WK29

1193

WK39

2358

WK49

2140

WK10

607

WK20

1071

WK30

903

WK40

1889

WK50

1724

Appendix 13
Hours in System
40
60
80

% to Ideal Productivity
75
85
100

Appendix 14
Hours in System
40
60
80

% hours requirement for cleaning defect

15%
10%
6%

Key Guidelines:

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Provide the source for every data point provided in the solution.

Clearly state any assumptions you make while giving recommendations/solutions.

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