Productivity

By
Prof. Sameer Nikam
AIMS.
Pune University.
 Industrial Engineering

qIndustrial Engineering: integrates knowledge and science

with support of Information Sciences.
q
qThe 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

q Productivity is defined as the output per unit of input.

q Measure of process improvement
q Productivity improves standard of living (productivity is closely
link with quality)
q Productivity : a measure of performance
q Effective utilization of Man Machine Material Method and capital.
q Important for manufacturing as well as service industry

 Productivity
4

qIt is frequently measured using labor or technological

benchmarks.
q
qHigher productivity can be obtained by improving worker skills,
improving technology, additional management training,
efficient distribution systems.
q
qProductivity is positively impacted by capital-intensive
processes.
q
qProductivity is directly related to economical growth

q
OPM 533 Prepared by :
 Productivity

q 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.
q
q Industries where significant capital investments have made an
impact include agriculture and computer manufacturing.
q
q Productivity can also be improved by investing in human capital.
q 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.
q
q 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.
q
 Levels of productivity

 1. Individual productivity


2.
 Unit productivity


3.
 Company productivity


4.
 Industry productivity


5.
 Country productivity



 Objective of Productivity

q To bring technological change

q Efficiency
q Cost Saving
q Improving process
q Living standard
q
 Methods for improving Productivity

q Through operations and management

q Through motivation and involvement
q Improve technology and facilities
q Increase training
q Increase research and development Spending
q Increase employee participation
q Adopt automated and robotic systems
q Improve reward systems
q Enhance speed
q Enhance flexibility
q
 Factors affecting Productivity

Micro
Macro


a) Production Capacity
a) Infrastructure
b) Company policies
b) Free market policies
c) Corporate Management
c) Fiscal & monetary policies
d) Organization &
d) Social Eco. environment
Administration
e) Work ethics
e) Corporate culture
f) Human resource
Training & development
f)
development
 Factors…

q The macro factors determine the national environment in which

 a business is regulated and the quality of resources available


q The micro factors refer to the competence of individual

 organizations in transforming the available resources into value
 added products and services.


q It is on a combination of these two factors that the

 competitiveness of a country depends
Techniques
 Value Analysis
&
Value Engineering
 Value..

Desired performance (P)

Value =
Overall Costs (C)

Value can be increased by either improving

the Performance or reducing the cost.
 Value Engineering

Value Engineering : Technique applied to identified

optimum value solution during new product
development.
Value Analysis : Technique applied for improving
existing product process or service. Objective is to
reduce cost bit to improve the performance and
quality.
It is a powerful problem-solving tool that can reduce
costs while maintaining or improving performance
and quality requirements.

Value Analysis, is a systematic and function-based
approach to improving the value of products, project
or service.

Work Study
 Work Study
 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


 Work Study succeeds because it is systematic both in the

investigation of the problem being considered and in the

development of its solution.


 Work study focuses on process & human activity and can increase

productivity at a lower cost.


 Objective

 Finding better ways of doing work.

 Increased production and productivity(by Effective utilization of

resources & Avoiding waste).

 Improvement of conditions, which involve an element of excessive

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

accomplish the goal.

 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 elemen

Higher Productivity Improved Process

 Work study

Work
Method study
measurement

Selection
Recording Work
Time Study sampling
Flow
Motion
process
chart
chart
Examine

Develop

Install

Maintain

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.
2.
3. Idle plant labor shows under utilization of resources .
4.
5. Poor moral of workers may affect the quality of the product. Due to
this there may be high absentism.
6.
7. Inconsistent earnings also advocate for the review of prod’n
method.
 Improved layout of office, working areas of factories.

 Improved design of plant and equipment.

 Effective handling of materials.

 Improved flow of work.

 Improved safety standards.

 Standardization of methods.

 Better working conditions.

Basic procedure of method study

Select

Record

Examine

OK

Develop

Install

Maintain
 Selection of job
 Finding out problem area

 There are three factors that should be kept in secd when

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

 Collection of data , observation

 There are various recording techniques, selection of work is
depend on nature of work
 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.
 Recording serves essentially as a basis for following analysis and
examination .
 Flow process chart

Operation

Transportation

Inspection

Delay

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

Idle time
10 sec 10 sec 10 sec

5 sec 5 sec
5 sec

Machine 1 Man Machine 2

 Examine

Examination is done by critical analysis

Use of question technique
 Primary Questions
 The PURPOSE for which
 The PLACE at which
 The SEQUENCE in which
 The PERSON by whom
 The MEANS by which

 Secondary Questions
 (purpose, place, sequence, person, Means )

 Development

Implementation of new method

Finding alternate options
Minimizing non-value added activity
Making necessary changes where it is require.
 Work measurement
 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
 Data collected is use for
 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

 Time study is a technique of work measurement to established time

for qualified worker to carry out a specific task under specific

conditions
 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
 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

nWork Sampling is a technique of finding the percentage occurrence of

certain activity by random observation and statistical sampling.
nLabor standard is set using output and % of time worker spends on tasks.
nInvolves observing worker at random times over a long period.
nThe work-sampling technique collects data at intervals of time.
nStatistical 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
 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

nRecord the number of units produced during the applicable

portion of the study
nCompute the normal time per part
nCompute the standard time per part
 Advantages over Time Studies
 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 long-cycle
work processes.

Business Process
Reengineering
 Process : Set of activity which converts input into output

 Business Process : Set of logical activity follows sequentially

to get some business outcome

 Reengineering : fundamental rethinking and radical

redesign
 Business Process Reengineering
 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


 An approach aiming at improvements by means of

elevating efficiency and effectiveness of the business process that
exist within and across organizations


 Brings improvements in
 Cost
 Quality
 Speed,
 Service


 What to Reengineer ?


 How to Reengineer ?
 Methodology….
 Determine Customer Requirements &Goals for the Process
 Map and Measure the Existing Process
 Innovation
 Analyze and Modify Existing Process
 Design a Reengineered Process
 Implement the Reengineered Process
 Monitoring &

Vision Measure
Current New
Process Process
Change

Transforming
Methodology
 Objective

 Improve Efficiency e.g reduce time to market, provide

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

Walmart was carrying 6to7 weeks inventory now it

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