productivity
DESCRIPTION
ProductivityTRANSCRIPT
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Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 3-1 © 1998 by Prentice Hall, Inc.
A Simon & Schuster CompanyUpper Saddle River, N.J. 07458
Operations Operations ManagementManagement
ProductivityProductivity
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Measurement ProblemsMeasurement Problems
¨ Quality may change while the quantity of inputs and outputs remains constant.
¨ External elements may cause an increase or decrease in productivity.
¨ Precise units of measure may be lacking
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Productivity:
“production per unit of effort” effectiveness of productive effort
Work organisation:quantitative techniques to optimise
productivity
ProductivityProductivity
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Efficiency = Output / Unit Input
Efficiency is “doing the thing right”
Effectiveness is “doing the right thing”
Productivity is an efficiency measure usually quoted as:
Productivity = Output / Worker hours
Machine productivity = output / machine hoursor = output / capital invested
Energy productivity = output / kilowatt-hours
ProductivityProductivity
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Productivity VariablesProductivity Variables
¨ Labor - contributes about 1/6 of the annual increase
¨ Capital - contributes about 1/6 of the annual increase
¨ Management - contributes about 2/3 of the annual increase
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Service ProductivityService Productivity
¨ Typically labor intensive
¨ Frequently individually processed
¨ Often an intellectual task performed by professionals
¨ Often difficult to mechanize
¨ Often difficult to evaluate for quality
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Transparency Masters to accompany Operations Management, 5E (Heizer & Render)
© 1998 by Prentice Hall, Inc.A Simon & Schuster Company
Upper Saddle River, N.J. 07458
Productivity Growth 1971- 1992Productivity Growth 1971- 1992
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
5
United StatesWest GermanyJapan
Whole Economy Manufacturing
% p
er y
ear
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Transparency Masters to accompany Operations Management, 5E (Heizer & Render)
© 1998 by Prentice Hall, Inc.A Simon & Schuster Company
Upper Saddle River, N.J. 07458
WhirlpoolWhirlpool
Parts per man hour
95
100
105
110
115
1989 1990 1991
Cost per unit of a spin pinion
$1.50
$1.75
$2.00
$2.25
1989 1990 1991
Average worker's annual cash compensation
24000
25000
26000
27000
1989 1990 1991
Productivity improved Costs were pared Wages increased
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Multi-Factor ProductivityMulti-Factor Productivity
Multi-Factor Productivity: which facility has the best productivity?
Stator Pty Ltd Rotor Pty Ltd
Workers 500 100
Labour costs $20,000/yr/worker $20,000/yr/worker
Equipment $1m $5m
Output 1500 1200
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Stator Pty Ltd Rotor Pty Ltd
Normal (labour) productivity = 1500 / 500= 3 machines / worker
= 1200 / 100= 12 machines / worker
Capital productivity = 1500 / $1m= 15 machines / $100k
= 1200 / $5m= 2.4 machines / $100k
Labour/capital multi-factor productivity
= 1500 / (500x(20k) + 1000k)= 136 machines / $1m
= 1200 / (100x(2k) + 5000k)= 171 machines / $1m
Multi-Factor ProductivityMulti-Factor Productivity
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Productivity SummaryProductivity Summary
• When analysing productivity the measures must be appropriate
• These measures must be quantitative so that changes can be monitored
• Quality should not be traded for productivity
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Work StudyWork Study
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Work StudyWork Study
Work study
Method study Work measurement
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Method StudyMethod Study
Method study is the systematic examination of the way work is carried out currently. There are a number of stages through which the study must progress:
1. Selection process
2. Data recording
3. Analysis and development of New Method
4. Brainstorming
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Selection ProcessSelection Process
The selection may be prompted by any of a number of factors:
• Management directive
• Consultant report
• Quality circle
• Perceived bottleneck
• Under-utilised equipment
• Poor quality
• Frequent failure
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Data RecordingData Recording
Process charts – five basic symbols are generally used
Transport
Permanent storage
O Operation
D Delay or temporary storage
□ Inspection
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ExampleExample
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ExampleExample
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ExampleExample
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ExampleExample
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Layout ExampleLayout Example
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Layout ExampleLayout Example
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Layout ExampleLayout Example
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Travel ChartTravel Chart
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Analysis of new methodAnalysis of new method
•Have an open mind•Employ a systematic approach
One technique used to force a systematic investigation of the data is a set list of questions
What is being done?Why is it being done?What else could be done?What else should be done?
When is it done?Why then?When else could it be done?When should it be done?
Where is it being done?Why there?Where else could it be done?Where should it be done?
Who does it?Why that person?Who else might do it?Who should do it?
How is it done?Why that way?How else can it be done?How else should it be done?
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Brain StormingBrain Storming
Brainstorming may help in the development of new ideas and methods
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Installation of new methodInstallation of new method
The new method will need to be:
• Sold to all those concerned
• Implemented efficiently
• Supported with training
• Monitored to ascertain the level of improvement
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Work MeasurementWork Measurement(Time and Motion Study(Time and Motion Study
Reasons why work rates may need to be measured
• Scheduling and loading
• Line balancing and manning levels
• Method comparison
• Budget and cost control systems
• Estimation costs and loads
• Financial incentives
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Time StudyTime Study
The rating for a qualified worker is 100
basic time = observed time (% rating)for work element 1 = 1.7 x (135/100) = 2.3 minutes
Work element Observed time Rating
1 1.7 135
2 3.1 90
3 1.2 80
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Time and Motion StudyTime and Motion Study
The observed time only covers actual work done. Other factors
• Relaxation allowance• Contingency allowance for extra work• Contingency allowance for delay• Unoccupied time allowance• Interference allowance
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Time and Motion StudyTime and Motion Study
Work content = Basic + Relax’n allowance + Contingency allowance (extra work)
(% of basic time) (% of basic time)
Standard time = Work content + Contingency allowance + Unoccupied allowance
(% of work content) (% of work content)
+ Interference allowance + ……... (% of work content)
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TMSTMS
Observed time element (min)
Rating Basic time (min)
1.3 90 1.17
4.2 110 4.62
8.6 115 9.89
9.3 85 7.9
5.2 125 6.5
• Relaxation 12%• Extra work 3%• Delay 4%• Unoccupied time 3%• Interference 2%
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TMSTMS
Work content = 30.08 + 3.61 + 0.9 = 34.59
Standard time = 34.59 + 1.38 + 1.04 + 0.69 = 37.7 minutes
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Activity Based SamplingActivity Based Sampling
1. Explain with the operators the reason for the study
2. Examine the process and identify activities
3. Carry lut a preliminary study of the activities to establish the number of observation required for a full study (100 – 200 random observations)
4. Determine the number of observations required to establish a given degree of accuracy in the amount of down time observed
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ABSABS
Number of observations required: N = 4P(100 – P) / (L2)where P = percentage occurrence of desired activity
L = required percentage activity
If a preliminary study indicated that the machine was productive for 35% of the time, and a full study was required to give an answer of 2% accuracy on this figure.
Then N = 4 x 35(100 – 35)(2 x 2) = 2275 observations
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Pre Determined Motion and Time Pre Determined Motion and Time StudyStudy
Human movement is broken down and classified
For each movement there is an associated time, usually expressed as a Time Management Unit (TMU) where:
1 TMU = 0.00001 hours = 0.036 seconds
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Nine Categories of MTM-XNine Categories of MTM-X
Category Description Code
1 Get Reach to and grasp an object GE (easy)GD
(difficult)
2 Put Move and position an object PE (easy)PD (difficult
3 Regrasp Shift the grasp on an object R
4 Handle weight Apply force to move an object HW
5 Apply pressure Apply force where no movement is involved A
6 Eye action Eye focus and eye travel E
7 Step A pace in walking S
8 Bend down Bend the trunk BD
9 Arise from bend Straighten the trunk AB
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MTM-XGE GD PE PD
N 8 17 5 19F 16 25 14 28X 13 20 9 22
In addition to the initial classification, some may be qualified by the distance of reach or weight:
F = far N = near X = variable