What does Resource Utilization measure?

Resource Utilization measures the fraction of time a workstation or individual is busy over the long run because it reflects how effectively resources are being employed relative to their potential. It provides insight into how consistently a resource is engaged in productive activities compared to its availability.

When measuring resource utilization, a high percentage indicates that a workstation or individual is busy a significant amount of the time they are available, which suggests effective use of resources. Conversely, low utilization may reveal inefficiencies or underemployment of the resources. This metric is particularly important in operations management, as it directly impacts productivity, cost efficiency, and overall operational effectiveness.

In contrast, the maximum capacity of a workstation focuses on the upper limits of output rather than utilization itself. The total output produced by a team relates to the amount of work completed, which is a different dimension of performance. The efficiency of individual task completion assesses how effectively specific tasks are carried out without considering the broader context of overall resource engagement. Therefore, option B uniquely captures the essence of resource utilization as it pertains to workload and efficiency over time.