Chapter 24: Determining Time/Job

1. Chapter 24: Determining Time/Job • Uses for time/unit information • Cost allocation • Production and inventory control • Evaluation of alternatives • Determining acceptable day’s work • Determining incentive pay

2. Establishing time standards • Choice of time measurement technique depends on: • Cost of obtaining the information • Benefits of using the information • Inaccurate information leads to wrong decisions. • If the standard is set 5% too low, there is a 5% loss in productivity.

3. Nonengineered (type 2) estimates • “Did take” or “Should take” • Used as a temporary measure, based on • Historical records • Expert opinion • Time logs • Occurrence sampling

4. Engineered (type 1) estimates • Provide accurate estimates • Must be preceded by a methods and quality analysis • Have few subjective and many objective characteristics • May be found through stopwatch time study or standard data

5. Time study: 3 levels • Observed time: “raw” data • Normal time = Observed time × Rating • Rating: • Standard time = Normal time + Allowances • Standard time is normal time plus allowances. • Shift allowances are a percentage of shift time. • Work allowances are a percentage of work time. • Personal Allowances • Fatigue Allowances • Delay Allowances

6. Standard data • Are expressed in normal time • Are set by analyst visualizing the work method • Have three advantages: • Cost of determining the standard is low. • Consistency is high. • Standards can be calculated ahead of production.

7. Learning • Amount of time to perform a task depends on how much practice the person has. • Learning occurs in both the individual and the organization. • The primary cause for incorrect standard times is failure to adjust for learning.

8. Individual learning • Improvement in time/unit even though the product, tools, and equipment don’t change. • Individual improvements come from: • Better eye–hand coordination • Fewer mistakes • Reduced decision time

9. Organizational learning • Improvement in time/unit due to changing product design, changing tools and equipment, or changing work methods. • Organizational learning includes individual learning. • Organization improvements come from: • Operator learning • New technology • Substitution of capital for labor

10. Quantifying improvement • Manufacturing progress curves are placed on a log–log scale. • On a log scale the physical distance between doubled quantities is a constant. • The progress curve becomes straight.

11. Example learning curve Assembling a part This is an ____________ learning curve. Mathematically, ______________

12. Working with the curve • Determining the learning factor, b, for the 80% curve log10 y = log10a + b*log10x or, rearranging and solving for b: • Solve for a using the cycle time for 1 cycle

13. Using the learning curve • MTM-2 analysis shows a standard time of 2 min. How many cycles does it take to reach it? • How long will this take (in minutes)?

14. Your turn … You have conducted a time study for an operation. At the 50th cycle the cycle time is 20 minutes and at 100th cycle the cycle time is 15 min. (i.e., (x1,y1) = (50,20) and (x2,y2) = (100,15)) • What is the learning curve? What are a and b? • How many cycles would be required to meet a standard time of 10 minutes? • How long will this take? What is the average cycle time?

15. Organization progress • Rate of improvement depends on amount that can be learned. • Amount that can be learned depends on: • Amount of previous experience with the product • Extent of mechanization

16. Individual learning • Has two components: • Cognitive learning • Motor learning • Motor learning is slower. • Cognitive learning has greater improvement.

17. Applications of learning • Cost allocation • Scheduling • Evaluation of alternatives • Acceptable day’s work

18. Documenting, using, and maintaining standards • Quantification of output • Audits • Feeding information back to workers