SECTION 2 STRATEGIC DESIGN

1. Operations Management I Dirección de Operaciones I- English teaching Departamento de Organización de Empresas y Marketing Área de Organización de Empresas SECTION 2STRATEGIC DESIGN 3º GADI- 5º DG-ADI-DER 2013-2014 Slide presentation Chapter 5

2. CHAPTER 5 JOB DESIGN AND WORK MEASUREMENT 5.1. Job Design 5.2. Methods Analysis 5.3. Labor Standards and Work Measurement

3. 5.1 Job Design • Specifying the tasks that constitute a job for an individual or a group • Job specialization • Job expansion • Psychological components • Self-directed teams • Motivation and incentive systems • Ergonomics and work methods • Visual workplace

4. 1. Labor Specialization • The division of labor into unique tasks • First suggested by Adam Smith in 1776 • Development of dexterity and faster learning • Less loss of time • Development of specialized tools • Later Charles Babbage (1832) added another consideration • Wages exactly fit the required skill

5. 2. Job Expansion • Adding more variety to jobs • Intended to reduce boredom associated with labor specialization • Job enlargement: The grouping of a variety of tasks about the same skill level; horizontal expansion • Job rotation: A system in which an employee is moved from one specialized job to another • Job enrichment: A method of giving an employee more responsibility that includes some of the planning and control necessary for job accomplishment; vertical expansion • Employee empowerment: Enlarging employee jobs so that the added responsibility and authority is moved to the lowest level possible in the organization

6. Enriched job Planning (participating in a cross-function quality-improvement team) Enlarged job Task #3 (lock printed circuit board into fixture for next operation) Present job (manually insert and solder six resistors) Task #2 (adhere labels to printed circuit board) Control (Test circuits after assembly) Job Enlargement-Job Enrichment

7. 3. Psychological Components of Job Design Human resource strategy requires consideration of the psychological components of job design. These components focus on how to design jobs that meet some minimum psychological requirements Hawthorne studies (late 1920’s-1930’s) introduced psychology to the workplace: The workplace social system and distinct roles played by individuals may be more important than physical factors

8. Core Job Characteristics Jobs should include the following characteristics • Skill variety • Job identity • Job significance • Autonomy • Feedback

9. 4. Self-Directed Teams • Group of empowered individuals working together to reach a common goal • May be organized for long-term or short-term objectives • Effective because • Provide employee empowerment • Ensure core job characteristics • Meet individual psychological needs

10. Self-directed teams Increasing reliance on employee’s contribution and increasing responsibility accepted by employee Empowerment Enrichment Enlargement Specialization Job expansion Job Design Continuum

11. 4. Self-Directed Teams To maximize effectiveness, managers should • Ensure those who have legitimate contributions are on the team • Provide management support • Ensure the necessary training • Endorse clear objectives and goals • Financial and non-financial rewards • Many teams have definite life cycles

12. Benefits of Teams and Expanded Job Designs Improved quality of work life Improved job satisfaction Increased motivation Allows employees to accept more responsibility Improved productivity and quality Reduced turnover and absenteeism Limitations of Job Expansion Higher capital cost Individuals may prefer simple jobs Higher wages rates for greater skills Smaller labor pool Increased accident rates Current technology may not lend itself to job expansion

13. 5. Motivation and Incentive Systems • Bonuses - cash or stock options • Profit-sharing - profits for distribution to employees • Gain sharing - rewards for improvements • Incentive plans - typically based on production rates • Knowledge-based systems - reward for knowledge or skills

14. 6. Ergonomics and Work Methods • Ergonomics is the study of the interface between man and machine • Often called human factors • Operator input to machines • Feedback to operators • The work environment • Illumination • Noise • Temperature • Humidity

15. 7. The Visual Workplace • Use low-cost visual devices to share information quickly and accurately • Displays and graphs replace printouts and paperwork • Able to provide timely information in a dynamic environment • System should focus on improvement • Visual systems can take many forms and serve many functions: • Present the big picture • Performance (kanbans, clocks, … ) • Housekeeping (shadow boards and footprinting, labeling, color-coded signs and lights, … )

16. Examples: The Visual Workplace Visual utensil holder encourages housekeeping A “3-minute service” clock reminds employees of the goal

17. Reorder point Line/machine stoppage Parts/ maintenance needed All systems go Part A Part B Part C Andon Examples: The Visual Workplace Visual signals at the machine notify support personnel Visual kanbans reduce inventory and foster JIT

18. Examples: The Visual Workplace Quantities in bins indicate ongoing daily requirements and clipboards provide information on schedule changes Process specifications and operating procedures are posted in each work area

19. 5.2 Methods Analysis • Focuses on how task is performed • Used to analyze • Movement of individuals or material • Flow diagrams: drawings used to analyze movement of people or material • Process charts: A graphic representation that depicts a sequence of steps for a process • Activities of human and machine and crew activity • Activity charts: A way of improving utilization of an operator and a machine or some combination of operators (a crew) and machines • Body movement • Operations or micro-motion charts: A chart depicting right and left hand motions

20. Welding From press mach. Storage bins Paint shop Mach. 3 Mach. 4 Machine 1 Mach. 2 Flow Diagram Old method

21. Welding Machine 4 Machine 3 Paint shop Machine 2 Machine 1 From press mach. Storage bins Flow Diagram New method

22. Process Chart New method

23. Activity Chart

24. Operation Chart

25. 5.3 Labor Standards and Work Measurement • Started early in the 20th century (F. Taylor and F. and L. Gilbreth) • Important to both manufacturing and service organizations • Necessary for determining staffing requirements • Important to labor incentive systems • Meaningful standards help determine: Labor content of items produced Staffing needs Cost and time estimates Crew size and work balance Expected production Basis of wage incentive plans Efficiency of employees

26. 5.3 Labor Standards and Work Measurement Labor standards may be set in four ways: Historical experience Time studies Predetermined time standards Work sampling

27. 1. Historical Experience • How the task was performed last time • Easy and inexpensive • Data available from production records or time cards • Data is not objective and may be inaccurate • Not recommended

28. 2. Time Studies • Involves timing a sample of a worker’s performance and using it to set a standard • Requires trained and experienced observers • Cannot be set before the work is performed • Eight steps: Define the task Divide the task into precise elements Decide how many times to measure the task Time and record element times and rating of performance

29. sum of the times recorded to perform each element number of cycles observed Average observed cycle time = total normal time 1 - allowance factor Standard time = performance rating factor 2. Time Studies Compute average cycle time Determine performance rating and normal time average observed cycle time Normal time = x Add all the normal times for each element to develop the total normal time for the task Compute the standard time

30. Rest Allowances • Personal time allowance • 4% - 7% of total time for use of restroom, water fountain, etc. • Delay allowance • Based upon actual delays that occur • Fatigue allowance • Based on our knowledge of human energy expenditure

31. Normal time = (average observed time) x (rating factor) = (4.0)(.85) = 3.4 minutes normal time 1 - allowance factor Standard time = = = 3.4 1 - .13 3.4 .87 = 3.9 minutes Example 1 The time study of a work operation yielded an average observed time of 4.0 minutes. The analyst rated the observed worker at 85%. This means the worker performed at 85% of normal when the study was made. The firm uses a 13% allowance factor. We want to compute the standard time. SOLUTION:

32. Cycle Observed (in minutes) Performance Job Element 1 2 3 4 5 Rating Compose and type letter 8 10 9 21* 11 120% Type envelope address 2 3 2 1 3 105% Stuff, stamp, seal, and 2 1 5* 2 1 110% sort envelopes Example 2 Management Science Associates promotes its management development seminars by mailing thousands of individually composed and typed letters to various firms. A time study has been conducted on the task of preparing letters for mailing. ON the basis of the following observations, MSA wants to develop a time standard for this task. The firm’s personal, delay, and fatigue allowance factor is 15%.

33. 3. Predetermined Time Standards • Divide manual work into small basic elements that have established times • Can be done in a laboratory away from the actual production operation • Can be set before the work is actually performed • No performance ratings are necessary • Methods Time Measurement (MTM) • Therbligs (Gilbreth): basic motions (select, grasp, position, assemble, reach, hold, rest, and inspect) • Time Measurement Unit (TMU): unit for very basic micromotions in which 1TMU = .0006 min or 100.000 TMUs = 1hr

34. MTM Table

35. 4. Work Sampling • Estimates percent of time a worker spends on various tasks • Less expensive than time study • Observers need little training • Studies can be delayed or interrupted with little impact on results • Worker has little chance to affect results • Less intrusive Adv. • Does not divide work elements as completely as time study • Can yield biased results if observer does not follow random pattern • Less accurate than time study, especially when job element times are short Disadv.