Em week 6 productivity management

ENGINEERING MANAGEMENT

Prof. Dr. Mete Gündoğan

SECTION 2 PRODUCTIVITY MANAGEMENT Lesson Content:  Behavioural Techniques For Productivity Growth;  Brain Storming  Nominal Group technique  Lateral Thinking

 Economic Analysis For Productivity Growth  Work Study  Method Study  Work Measurement

 Global-Level Productivity

Techniques for Productivity Improvement: WORK STUDY Method study (Motion study) Work measurement (Time study)

WORK STUDY Target : reducing work content and Ineffective time.

Work content: the amount of work “contained in” a given product or process measured in man-hour or machinehour.

Ineffective time: is the time for which the worker or machine or both are idle due to the shortcomings of the management or the worker.

WORK STUDY

WORK STUDY

Work Study Principles Of Work Study  Must come from the top level management.  People made aware of the objectives and the need of the exercising such study.  Method study must precede work measurement .

Work Study Objectives  To analyze the present method of doing a job, systematically in order to develop a new and better method.  To measure the work content of a job by measuring the time required to do the job for a qualified worker and hence to establish standard time.  To increase the productivity by ensuring the best possible use of human, machine and material resources and to achieve best quality product/service at minimum possible cost.  To improve operational efficiency.  To reduce waste through standardization of work elements of a job.  To improve labor efficiency.

Work Study Benefits Of Work Study • Increased productivity and operational efficiency • Reduced manufacturing costs • Improved work place layout • Better manpower planning and capacity planning • Fair wages to employees • Better working conditions to employees • Improved work flow • Reduced material handling costs • Provides a standard of performance to measure labour efficiency • Better industrial relations and employee morale • Basis for sound incentive scheme • Provides better job satisfaction to employees

Limitations of Work Study  It is applicable primarily to labour intensive/well defined

(repetitive) kind of jobs.  It faces is that there is a limit beyond which it can not improve the efficiency.  Third limitation is on repeatability, speed and accuracy.

Capital investment in technology often brings kind of production efficiency, accuracy and speed which are beyond the realm of work study.

Work Study WORK STUDY METHOD STUDY • Motion Study : Examine the job and finding more efficient method to perform it

WORK MEASUREMENT • Time Study : Determine the time necessary to perform a job and its elements

Method Study  Method study is one of principal techniques by which

work content in the product manufacture or process could be decreased.  It is a systematic method of investigating and critically examining the existing methods, to develop the improved ones.  Method study is, then, a technique to reduce the work content mainly by eliminating unnecessary movements by workers and/or materials and/or equipments.

Method Study  To analyse the elements of a given work to devise a better

working method/operating system.  This is a macro view of the work process and content.  Motion study is based on the principle that:  One best way of doing it.  A scientific method is the best and surest way of finding this best way.

Method Study Steps of Method Study

Method Study Objectives of method study:  To improve the procedure of doing a work.  To improve the workplace layout (ultimately plant layout).  To minimize the human motion for minimum fatigue of operators.  To maximize the utility of resources (men, m/c, materials).  To improve the overall working environment.

Method Study Advantages of method study:  Work simplification  Improved working method ( cheaper method)  Better product quality  Improved work place layout  Improved equipment design  Better working conditions

Method Study Disadvantages of method study:  High operating cost  High wastage & scrap  Excessive movement of materials and workmen  Excessive production bottlenecks  Excessive rejections and rework  Complaints about quality

Work Measurement Definition:  “The application of techniques designed to establish the time for a qualified worker to carry out a specified job at a defined level of performance”

Work Measurement        

Objectives Of Work Measurement : Comparing alternative methods Assessing the correct initial manning (manpower requirement planning) Planning and control Realistic costing Delivery date of planning Cost reduction and cost control Identifying substandard workers Training new employees.

Work Measurement Techniques Of Work Measurement :  Time Study  Synthesis  Work Sampling  Analytical Estimation  Predetermined Motion and Time Study.

Historical Data Method  Historical data method uses the past-performance data.  Past performance is used as a guideline for setting work

performance standards.  The main advantage of this technique is that it is simple to understand, quicker to estimate and easier to implement.  However, past performance is not the best basis for fixing performance standards. This is because there may be many changes in technology, employees’ behavior, abilities, etc.

Work sampling  The workers are observed many times at random to find out for how much time

the worker is actually on the job.  It checks how long he is working and how much time he is not working (idle time).  Purpose of technique is to estimate what proportion of a worker’s time is devoted to work-related activities.  It involves three main steps:  Deciding what activities are defined as ’working’. Non-working are those activities

which are not defined as working.  Observe the worker at selected intervals and record (write down) whether he is working or not.  Calculate the portion of time (P), a worker is working.  A portion of time (P) a worker is working equals to ’Number of observations

during which working occurred’ divided by ’Total Number of observations.’  The above calculation is used as a performance standard.

Work sampling  Advantages of Work Sampling  Work sampling gives an unbiased result since workmen are not under

close observation.  A work sampling study may be interrupted at any time without affecting the results.  Work sampling can be conducted by anyone with limited training.

There is no need to have experts.  Team work can be studied by work sampling and not by the timestudy.  Work sampling is economical and less time-consuming than time study. This is because more than one worker can be studied at the same time. Secondly, observer needs not to be present himself for a long time.

Work sampling  Disadvantages of Work Sampling  Work sampling is not economical for short cycle jobs. It is also

uneconomical to study a single worker or even small group of workers.  Unlike time study, it does not allow a small breakdown of activities and delays.  Working men may change their normal method of working when they see an observer. Therefore, the results from the work study may not be accurate.  In work sampling method, the observations are limited or insufficient.

So, the results may not be accurate.  This method normally does not record the workers' speed of working.

Synthesis Method  The full job is first divided into elements. Then the time taken to

do each element of the job is found out and synthesized (totaled).

This gives the total time taken for doing the full job.  In this technique, the time taken to do each element of the job is found out from previous time studies.  The advantages of synthesis method:  It provides reliable information about standard time for doing different jobs. Because it is based on many past time studies.  It is economical because there is no need to conduct new time studies.

Predetermined Motion Time System ď‚— The normal times are fixed for basic human motions. These time

values are used to fix the time required for doing a job. Normally, three times are fixed for one job. That is, one time is fixed for each level of performance. The level of performance may be normal, fast and very-fast. ď‚— PTMS is better than motion studies because it gives the detailed analysis of the motion, and it fixes the standard time for doing that motion. ď‚— PTMS technique is used mostly for jobs, which are planned for future.

Predetermined Motion Time System  The advantages of PMTS method:  It is a very accurate method. It avoids subjective judgement or bias

of rater.  It is an effective and economical method for repetitive jobs of short duration.  There is no interference in the normal work routine, and so it does not face any resistance from the employees.  It helps to improve the work methods because it gives a detailed analysis of the motions.  It is more economical and fast compared to normal time studies.

Analytical Estimating  It is used for fixing the standard time for jobs, which are very long

and repetitive.  The standard-time is fixed by using standard-data.  The benefits of analytical estimating technique:  It helps in planning and scheduling the production activities.  It provides a basis for fixing labor rate for non-repetitive jobs.  It is economical.  One disadvantage of analytical estimating method:  When standard-data is not available for a job, then the standard time is fixed by the work-study engineer. He uses his experience and judgement for estimating the standard-time. This is not accurate compared to a scientific time study.

Time Study ď‚— Time study is work measurement technique for recording

the times and rates of working for the elements of a specified job carried out under specified under specified conditions.

Time Study  Once the wasteful work has been deleted at the macro

level through method study, fine tuning is required at micro level.  Each motion is timed and a standard time arrived at for the whole job after allowing due concessions as required for fatigue, rest, etc.  Time study is based on the principle that:  The time taken for doing the job by the best way can be measured and set as standards.

Time Study Selecting a job for time study:  The job is a new one not previously carried out.  A change in material or method of working has been made and a new time standard is required.  A complaint has been received about the time standard for an operation.  A particular operation appears to be “bottleneck” holding up the subsequent operations and possibly previous operations.  Standard times are required prior to the introduction of an incentive scheme.

Time Study Selecting a job for time study:  To investigate the utilization of a piece of plant, the output of which is low, or which appears to be idle for an excessive time.  As a preliminary to making a method study, or to compare the efficiency of two proposed methods.  When the costs of a particular job appears to be excessive.

Time Study Objectives of time study:  To determine the standard time for various operations which helps in fixing wage rates and incentives.  To estimate the cost of product accurately.  To predict accurately the duration for a particular work and customer is promised accordingly.  To determine the number of machines an operator can run.  To determine the optimum number of men and machine.  To provide information for planning and scheduling.  To balance the work of all workers working in a group.  To compare the work efficiency of different workers/operators.

Time Study Steps of Time Study 1)SELECT (Selecting job for work study) 2)OBTAIN & RECORD (Details Regarding methods,Operator, Job and working condition) 3)DEFINE (The element, Break the job into convenient for timing) 4)MEASURE (Time duration for each element and assess the rating) 5)EXTEND (Observed time into normal time {Basic time}) 6)DETERMINED (Relaxation and personal allowances) 7) COMPUTE (Standard time for the operation for defined job or operation.)

Time Study 

  



Setting Standard Times Step 1: Select the job to be studied.

Breakdown the work content of the job into smallest possible elements.

Inform the worker and define the best method.

Step 2: Observe the time for appropriate number of cycles (such as 25 to 50).

Step 3: Determine the average cycle time (CT) CT = Σ Times / No. of cycles Step 4: Determine the normal time (NT) NT = CT (PR) (PR is the performance rating. ) Step 5: Determine the standard time using the following formula ST = NT (AF) Allowance factor = AF = 1 / (1- % Allowance )

Time Study Setting Standard Times  Standard time = observed time

+ rating factor + relaxation allowance + work related contingency allowance + delay related contingency allowance.

Time Study – Example 1  Assuming that the total observed time for an operation of assembling an electric

switch is 1.00 min.  If the rating is 120%, find normal time.  If an allowance of 10% is allowed for the operation, determine the standard time.

Time Study – Example 1 SOLUTION: Obsersved time (or) selected time = 1.00 min Rating = 120% Allowance = 10% Normal time = Observed time ×Rating % ÷ 100 = 1.00 ×120÷100=1.20min Allowance @ 10% = 1.20 ×10 ÷ 100 = 0.12 min Standard time = Normal time + Allowances = 1.20 + 0.12 = 1.32 min.

Time Study – Example 2 : Following datas were obtained by a work study. Man from a study conducted by hours. (i) Maintenance time  Get out and put away tools = 12.0 min/day  leaning of machine = 5.0 min/day  Oiling of machine = 5.0 min/day  Replenish coolant supply = 3.0 min/day (ii) Interruption  Interruption by foreman = 5.0 min/day  Interruption by porter etc. = 4.0 min/day (iii) Delay time due to power failure etc. = 6.0 min/day (iv) Personal time = 20.0 min/day Calculate total allowances, total available cycle time productive hours, considering a working day of 8 hours.

Time Study – Example 2 SOLUTION: Total allowance = Total maintenance time + Interruption time + Delay time + Personal time = (12.0 + 5 + 5 + 3.0) + (5.0 + 4.0) + 6.0 + 20.0 = 25.0 + 9.0 + 6.0 + 20.0 = 60.0 min per day Total available cycle time = Total work period – Total allowances = 480 – 60 = 420 min/day Productive hours =Time available Number of hours = 420 ÷60 = 7 hrs

Creativity Based Techniques for Productivity  Brain Storming  Nominal Group technique  Lateral Thinking

Brain Storming  Getting large number of ideas from a group of people in a short

time by following certain rules.  Gives a large number of ideas, but there is no guarantee that the ideas will be practicable.  It works on the premise that among the large quantity, there will be at least some good quality ones too by theory of probability.  But, there are no methods or thumb rules or any hint as to which idea is best among them.  Finding the best and discarding the rest is the job of the management.

Brain Storming Ground Rules for Brain Storming  Size : The group should be between 6-20 people. Ideal size is 12.  Composition : The group should be as heterogeneous as possible; age, gender, specialisation, profession, experience, etc. Such heterogeneity is important because it brings out different view points from a cross section.  Encourage Free Wheeling : Let people suggest wild, patently grotesque appearing ideas. Such out of the box thinking only will yield to new methods. More often than not, new methods will emerge out of most silly, appalling and contrarians ideas.  Suspend Judgement – Don’t pass any judgement either way till the end of session.

Just listen and keep listing them. Don’t even discuss them for too long. Let the person explain his/her idea and logic followed by small discussion.  Cross Fertilisation of Ideas – Encourage group members to hitch hike on each other’s ideas. Often two or three ideas complement each other and together become an implementable idea.

Brain Storming Steps in Brain Storming

Brain Storming

Nominal Group technique  It is a consensus planning tool that helps prioritize issues.  Participants are brought together for a discussion session led

by a moderator.  After the topic has been presented to session participants and they have had an opportunity to ask questions or briefly discuss the scope of the topic, they are asked to take a few minutes to think about and write down their responses.  The session moderator will then ask each participant to read, and elaborate on, one of their responses.  These are noted on a flipchart without the name of the person (no ownership of idea).

Nominal Group technique  Once everyone has given a response, participants will be

asked for a second and then next response, until all of their answers have been noted on flipcharts sheets posted around the room.  There after the duplications are eliminated and each unique response is assigned a letter or number.  Session participants are then asked to choose up to 10 responses that they feel are the most important and rank them according to their relative importance.  These rankings are collected from all participants, and aggregated.

Nominal Group technique ď‚— Sometimes these results are given back to the

participants in order to stimulate further discussion, and re-ranking of the responses. ď‚— This is done only when group consensus regarding the prioritization of issues is important to the overall research or planning project

Nominal Group technique

Nominal Group technique STEPS  Step 1. Small group gathers, receives instructions, identifies problems  Step 2. Write down ideas  Step 3. Each one presents ideas; Leader notes these ideas on a chart  Step 4. Group discusses, clarifies and evaluates each of the ideas  Step 5. Participants privately rank ideas in their order of preference  Step 6. Group selects highest ranking idea as a group decision

Nominal Group technique

Lateral Thinking  It is a term coined by Edward de Bono, a Maltese

psychologist, physician and writer.  It first appeared in the title of his book The Use of Lateral Thinking, published in 1967.  De Bono defines lateral thinking as methods o f thinking concerned with changing concepts and perception.  It is an unconventional approach to problem. It goes in a radically different way.

(It is like proposing to make a tired person work more instead of rest to relieve him of his fatigue; Or, proposing to overfeed a fat person to make him lose weight. Most of the time, the ideas appear bizarre in the beginning.)

Lateral Thinking What is Lateral Thinking?  Lateral thinking is solving problems through an indirect and creative approach, using reasoning that is not immediately obvious and involving ideas that may not be obtainable by using only traditional step-bystep logic.

Lateral Thinking What is Lateral Thinking?  Search for alternatives.  Looks to get away from patterns  Ignores logical direction and “…moves sideways by re-forming the patterns”  Is “an attitude of mind.”  Is low-probability thinking

Lateral Thinking Characteristics  Generative nature of publishing ideas, it aims to find alternatives to target.  Are interested in finding a variety of possibilities.

Interested in making the assessment or decision.  Do not like to defend the idea even though it is true.

This idea is proved correct assume still be improved.  Interested in finding such a good idea to be able to create a better idea.

Lateral Thinking Characteristics  Never a judgment. Lateral thinking does not hold a pattern to be wrong but the rigidity of the same to be wrong.  Lateral thinking is directly related to the information handling behaviour of the mind.  Concerned with changing patterns or breaking out of the concept prisons of old ideas and generation of new ideas and insights.  Closely related to creativity. Though creativity is too often the descriptions of a result, lateral thinking is the description of the process.

Lateral Thinking The Importance  Ability to be able to think quickly, laterally and if needed, sidestep conventions and rules.  Makes new ideas possible.  As a one way of doing this is to take two random, unrelated ideas, and put them together to create something new.  Able to look at things differently, and make an unlikely connection, this will take us to a new way of problem solving.  As a prepared to try a new thinking process and our thoughts will be generative.

Lateral Thinking

Lateral Thinking Use Of Lateral Thinking:  Creating new ideas  Problem solving  Processing  Periodic reassessment  Developing fresh thinking

Lateral Thinking Basic Methods Of Lateral Thinking:  Brainstorming  Cross stipulation  Debate  Discussion  Conversation  Sharing the ideas  Practise  Evaluation

Lateral Thinking THE WORD PO:  NO vs PO  Logic could be said to be the management of NO.  PO is language tool defining the rearrangement process which is the basis of lateral thinking.  The function of PO:  Creating new patterns  Challenging old patterns  Stated differently  Provocative and permissive  Liberating

PO IS BASICALY A ALTERNATIVE FINDING ,A NEW WAY

Lateral Thinking The example of lateral thinking:  One day you have just played tennis with your friends, you are very thirsty

when you arrive home. You go into the kitchen and you find a bottle of soda in the fridge. However, you cannot find a bottle opener. The solutions to get rid of soda. The person has already broken free from the given constrains and start to attack the problem from different directions.

Therefore, this group of solutions are generated from lateral thinking.  Solutions:  Drink something else, say tap water  Or buy a drink from convenience store  Have some fruit instead  Keep on look for other drinks at home.  etc...

Application of Productivity Measures  Individual level  Group level  Department level  Corporate level  National level  Global level

Global-Level Productivity  Why

are global-level productivity measures important?  How do we compare productivity among nations?  How can a nation increase productivity in a global economy?

Importance of Global-Level Productivity Measures  Measure and compare competitiveness among nations.  Contribute to the development of a nation’s economic,

social, and political policies.  Develop global cooperation among nations.  Help business organizations make investment decisions.

Global-Level Productivity Measures  Organisation for Economic Co-operation and

Development (OECD) http://www.oecd.org/home/  GDP per capita (labor productivity * fraction of people who work) is widely regarded as the best measure.  A common currency is used to measure the GDP.

Factors Affecting Productivity Improvement at Global Level  Education  Technology  Macroeconomic policies  Social and culture environments  Foreign aids  Foreign investments  Industry policies & competition

Why is National Productivity Important?  At the national level, growing productivity  leads to a higher standard of living  holds inflation in check  enhances international competitiveness.  The annual GDP growth is partially due to  growth in productivity  growth in inflation

National Productivity Measures  Comparisons within a segment of economy over time  Comparisons of specific productivity measures  International comparisons