Productivity

By Prof. Sameer Nikam AIMS. Pune University.

Industrial Engineering
Industrial Engineering: integrates knowledge and science with support of Information Sciences. The Industrial Engineer comprehends knowledge in those sciences in order to increase the productivity of processes, achieve quality products and assures Labor safety.
Technical Science Industrial Engg.

Human Science

Economic Science

Productivity
Productivity is defined as the output per unit of input. Measure of process improvement Productivity improves standard of living (productivity is closely link with quality) Productivity : a measure of performance Effective utilization of Man Machine Material Method and capital. Important for manufacturing as well as service industry

Productivity
1-4

It is frequently measured using labor or technological benchmarks. Higher productivity can be obtained by improving worker skills, improving technology, additional management training, efficient distribution systems. Productivity is positively impacted by capital-intensive processes. Productivity is directly related to economical growth

OPM 533

Prepared by : Shatina Saad

Productivity
A capital-intensive process is a production process that uses a high ratio of capital to labor inputs. For example the U.S. auto industry is a capital intensive industry.

Industries where significant capital investments have made an impact include agriculture and computer manufacturing.

Productivity can also be improved by investing in human capital.

And what is human capital? It is the knowledge and skills possessed by the work force. This includes the amount of education, training, and experience the workforce contains. Higher productivity is derived from using highly educated workers in capital-intensive production processes. Increasing the number and quality of high school and college graduates improves human capital and the productivity of the work force.

Levels of productivity
1. 2. 3. 4. 5. Individual productivity Unit productivity Company productivity Industry productivity Country productivity

Objective of Productivity
To bring technological change Efficiency Cost Saving Improving process Living standard

Methods for improving Productivity

Through operations and management Through motivation and involvement Improve technology and facilities Increase training Increase research and development Spending Increase employee participation Adopt automated and robotic systems Improve reward systems Enhance speed Enhance flexibility

Factors affecting Productivity

Macro
a)

Micro
a)

Infrastructure

Production Capacity

b) Free market policies c)

b) Company policies

Fiscal & monetary policies c) Corporate Management

d) Organization & Administration e) f)

d) Social Eco. environment e) f)

Work ethics Human resource development

Corporate culture Training & development

Factors
The macro factors determine the national environment in which a business is regulated and the quality of resources available The micro factors refer to the competence of individual organizations in transforming the available resources into value added products and services. It is on a combination of these two factors that the competitiveness of a country depends

Techniques

Productivity

Value Engineering / Value Analysis

Work Study

Business Process Reengineering

Total Productivity Management

Value Analysis & Value Engineering

Value..

Desired performance (P) Value = Overall Costs (C)

y Value can be increased by either improving

the Performance or reducing the cost.

Value Engineering
y Value Engineering : Technique applied to identified

optimum value solution during new product development. y Value Analysis : Technique applied for improving existing product process or service. Objective is to reduce cost bit to improve the performance and quality. y It is a powerful problem-solving tool that can reduce costs while maintaining or improving performance and quality requirements.

y Value Analysis, is a systematic and function-based

approach to improving the value of products, project or service.

Work Study

Work Study
y It is a Systematic examination of methods of carrying on activity

so as to improve the effective use of resources and to setup standards of performance for the activities carried out
y Work Study succeeds because it is systematic both in the

investigation of the problem being considered and in the development of its solution.
y Work study focuses on process & human activity and can increase

productivity at a lower cost.

Objective
y Finding better ways of doing work. y Increased production and productivity (by Effective utilization of

resources & Avoiding waste).

y Improvement of conditions, which involve an element of excessive

fatigue or danger
y Optimum utilization of human, machine and material for

accomplish the goal.

y Reduced costs - labour, material, overheads

Method Study : Examining a job and finding more efficient method to perform it

Work Study
Work Measurement : Determining the time necessary to perform a job and its elements

Higher Productivity

Improved Process

Work study

Method study Selection Recording Flow process chart Examine Develop Install Maintain Motion chart

Work measurement

Time Study

Work sampling

Higher Productivity

Method study
Finding new or better way of doing work Def : Examination of existing and propose way of doing a work with a view to develop and apply easier and more productive method of doing the same

Method study is the systematic recording and critical examination of ways of doing things in order to make improvements.

Need of Method Study

1.

Bottlenecks in the system resulting in long delivery time or unbalanced workflow. Idle plant labor shows under utilization of resources . Poor moral of workers may affect the quality of the product. Due to this there may be high absentism. Inconsistent earnings also advocate for the review of prodn method.

2. 3.

4.

y Improved layout of office, working areas of factories. y Improved design of plant and equipment. y Effective handling of materials. y Improved flow of work. y Improved safety standards. y Standardization of methods. y Better working conditions.

Basic procedure of method study

Select Record Examine
OK

Develop Install Maintain

Selection of job
y Finding out problem area y There are three factors that should be kept in secd when

selecting a job. 1) Economic consideration 2) Technical consideration 3) Human consideration

Recording
y Collection of data , observation y There are various recording techniques, selection of work is

depend on nature of work

y The success of the whole procedure depends on the accuracy

with which the facts are recorded, because they will provide the basis of both the critical examination and the development of the improved method.
y Recording serves essentially as a basis for following analysis and

examination .

Flow process chart

y Operation y Transportation y Inspection y Delay y Storage

Motion chart
30 sec 30 sec

30 sec

25 sec

25 sec

25 sec

20 sec

20 sec

20 sec

working time

15 sec

15 sec

15 sec

10 sec

10 sec

10 sec

Idle time

5 sec

5 sec

5 sec

Machine 1

Man

Machine 2

Examine
y Examination is done by critical analysis y Use of question technique  Primary Questions

The PURPOSE The PLACE The SEQUENCE The PERSON The MEANS

for which at which in which by whom by which

Secondary Questions
(purpose, place, sequence, person, Means )

Development
y Implementation of new method y Finding alternate options y Minimizing non-value added activity y Making necessary changes where it is require.

Work measurement
y

Work measurement is the application of techniques designed to establish the time for a qualified worker to carry out a task at a defined rate of working. The basic objective of work measurement is to determine the allowed time for a qualified worker to perform a given task, using a prescribe method, under a given set of condition. Management tool Objective of worker Measurement :  Reduce cost  Reduce unwanted time  Increase the motivation and set benchmark for improvement  Measure & Improve performance of resources  To schedule work and allocate capacity

y y

Data collected is use for

y y y y y y y y y

Manning Task planning Estimation of production cost Cost reduction Process improvement Incentives Set standard data Training others To check performance

Work measurement

Time Study

Work sampling

Time study
y

Time study is a technique of work measurement to established time for qualified worker to carry out a specific task under specific conditions

y y y y y

Most widely used technique Applicable for short cycle repetitive jobs Direct observation Using stopwatch Time require to perform a task during a cycle

Time study procedure

y y y y y y y y

Select the task Select the operator Record necessary details Break the task Measure the duration of every elements Measure normal time Calculate allowance Calculate standard time of the job

Work Sampling


Work Sampling is a technique of finding the percentage occurrence of certain activity by random observation and statistical sampling.

Labor standard is set using output and % of time worker spends on tasks.

  

Involves observing worker at random times over a long period. The work-sampling technique collects data at intervals of time. Statistical element is based on this law of probability: If a procedure is observed a sufficient number of times, the results will be as reliable as when the procedure is observed continuously over a period of time.

Work Sampling

Used for
  

delay studies Setting labor standards Measuring worker performance

The Seven Step Work Sampling Procedure

Compute the sample size required Take a preliminary sample to obtain an estimate of the parameter value
y

y y

Prepare a schedule for observing the worker at appropriate times

Observe and record worker activities; rate worker performance

The Seven Step Work Sampling Procedure - continued

Record the number of units produced during the applicable portion of the study
 

Compute the normal time per part Compute the standard time per part

Advantages over Time Studies

y y y y y y y

Longer time periods can be studied, Does not require analyst to make continuous observations, Operator is not subject to continuous observation, Many operations & workers can be studied by a single analyst. Require less cost Time study is more labor-intensive method of data collection Time study for Short cycle work processes work sampling for longcycle work processes.

Business Process Reengineering

y Process : Set of activity which converts input into output y Business Process : Set of logical activity follows

sequentially to get some business outcome

y Reengineering : fundamental rethinking and radical

redesign

Business Process Reengineering

y The fundamental rethinking and radical redesign of business

processes to achieve dramatic improvements in critical contemporary measures of performance, such as cost, quality, service, and speed
y An approach aiming at improvements by means of

elevating efficiency and effectiveness of the business process that exist within and across organizations
y Brings improvements in  Cost  Quality  Speed,  Service

What to Reengineer ? How to Reengineer ?

Methodology.
y Determine Customer Requirements &Goals for the Process y Map and Measure the Existing Process y Innovation y Analyze and Modify Existing Process y Design a Reengineered Process y Implement the Reengineered Process y Monitoring &

Vision
Current Process

Measure Change
New Process

Transforming Methodology

Objective
y Improve Efficiency e.g reduce time to market, provide

quicker response to customers

y Increase Effectiveness e.g deliver higher quality y Achieve Cost Saving in the longer run y Provide more Meaningful work for employees y Increase Flexibility and Adaptability to change y Enable new business Growth

Examples.
y Walmart was carrying 6to7 weeks inventory now it

has come down to 1or2 weeks y Dell used to take more than 15 days to deliver goods to customer, now it is delivered in 6 to 7 days

y Thank You