Productivity

1. Productivity Standard of living Definition of productivity

2. Standard of living • The extent to which a person is able to provide the things that are necessary for sustaining and enjoying life. • Standard of living of a representative family differs greatly in different parts of the world. • What is considered a necessity in one part of the world could be considered a luxury in the other. • Basic necessities of a minimum decent standard of living: Food, clothing, housing and hygiene. Also, security and education also considered constituents. • Greater the amount of goods and services produced in any community, the higher its the average standard of living.

3. Standard of living • There are two ways of increasing the amount of goods and services produced: - Increase the employment and investment in creating jobs. So that more people are producing goods required for the society. - Increase productivity. Same amount of labor produces more goods. We want: • More and cheaper food by increase in agricultural productivity • More and cheaper clothing and housing by increased industrial productivity • More hygiene, security and education by increasing overall productivity.

4. Productivity • Ratio between output and input. • Arithmetic ratio between the amount produced and the amount of any resources used in the production. • The resources may be: land, material, plant, machines, tools, labor. It could be combination of all! • Over a period of time, one can say that productivity has increased. • How? • Combination of improved technology, better planning, greater skills etc.

5. Productivity • Note that, increased production does not mean increased productivity. • Higher productivity means that more is produced with the same expenditure of resources; that is, at the same cost in terms of land, material, machine, time or labor. • Alternatively, same amount is produced at less cost in terms of land, labor, material etc; thereby releasing some of these resources for the production of other things.

6. Productivity and standard of living • If more is available at the same cost, or the same amount is available at lesser cost the whole community benefits. • As per the ILO, higher productivity provides ways for raising the standard of living by: • Larger supplies of both consumer goods and capital goods at lower cost and prices • Higher real earnings • Improvement in working conditions, e.g. by reduced working hours • In general, strengthening of the economic foundations of human well-being.

7. Productivity in industry • Many factors affecting productivity of each organization; also, they are dependent. • Depending on the individual environments, decisions are to be made. • Industries where labor and capital costs are low compared to the material costs, better use of material and plant gives the greatest scope of cost reduction. • In countries where capital and skilled labor are in shortage compared to unskilled labor, one should look to increase the output per machine or per skilled worker. • Increasing the number of unskilled workers may be beneficial if by doing so an expensive machine or skilled craftsmen are enabled to increase production.

8. Government’s responsibility • Government can create conditions favorable to raise productivity. It can: • Have a balanced programs of economic development • Take steps necessary to maintain employment • Make opportunities for employment. • Last step is specifically important for a developing country like India. • Government should make provisions for workers who are going to loose jobs because of technology improvement – training and education programs. • Example: India’s First Five-Year Plan (1952).

9. Management’s responsibility • The main responsibility for raising productivity in an individual organization lies with the management. • It can implement productivity programs. • It can create a positive environment and obtain co-operation of the employees. • Trade unions should encourage its members to provide such co-operation when the productivity program is beneficial to workers, as well as the organization on the whole. • We will look at management’s role in increasing productivity of individual resource:

10. Productivity of material At the design stage: • Ensure least consumption of material, • Purchase equipments and plants such that consumption of material is economical. At the operation stage: • Use of correct process • Right use of the process • Operator training • Proper handling and storage of products at all stages • Proper packaging to reduce damage in transit

11. Productivity of land, machines and manpower • Effective utilization and maximum productivity is an important source of cost reduction. • Reduction in the original specification, before the land is purchased saves capital outlay (as well as interest expenses) • A savings in material which has to be imported saves import duty and excise. • Productivity of manpower and machines is typically measured in terms of time (man-hours; machine-hours).

12. Factors tending to reduce productivity Work content added due to the product • The product or its components are designed such that it is impossible to use most economical manufacturing processes. • Excessive variety or lack of standardization. • Incorrect quality standards. • Excessive amount of material removal required.

13. Factors tending to reduce productivity Work content added due to process • Incorrect machine (and/or hand tool) used • Process not operated properly • Non-optimal layout with wasted movements. • Working methods of operation causing wasted movements, time and efforts.

14. Factors tending to reduce productivity Ineffective time due to management • Marketing policy which demands unnecessarily large number of products. • No standardization of components between as well as within products. • Failing to meet customer’s requirement from the beginning. • No plan for flow of work. • Improper supply of material, equipment. • Improper maintenance of plant and machines. • Insufficient safety measures. • Improper working conditions resulting in interrupted work.

15. Factors tending to reduce productivity Ineffective time within the control of worker • Taking time off without good cause: by lateness, by idling at work etc. • Careless workmanship causing scrap or rework. • Failing to observe safety standards.

16. Management techniques to reduce work content

17. Nature of management • Management is the organization and control of human activity directed towards specific ends. • Management techniques are systematic procedures of investigation, planning and control which can be applied to management problems. • Systematic approach to the solution of the problems proceeds step by step from known to the unknown, always on the basis of ascertained facts. • Since management deals with human beings, it can never be completely scientific, and must partly be regarded as an art.

18. Reduce work content due to the product • Coupling of product design and process design phases (design products such that most economical processes can be used). • Pilot project/ prototyping to avoid mistakes at a advanced stage (very common in chemical companies). • Standardization of components. • Setting correct quality standards Stricter standards lead to increased manufacturing time, lenient standards lead to greater variability. • Knowing the customer – Management should conduct market research and consumer surveys to know the customer better.

19. Reduce work content due to the method • Process planning – Identification of correct machines for the process. In chemical industry, this is specified by the R&D division or the license seller. • Process research – Identification of best manufacturing technique. • Proper maintenance. • Method study – Combine with process planning to give most suitable tools for the operative. Includes factory layout, working methods of the operative. • Operator training – Improve working methods of the operative.

20. Reduce ineffective time due to the management • Strategic decisions – Which markets to enter can affect ineffective time to a great extent. • Production planning – It is planning of proper programs of work so that plant and workers are kept supplied without having to wait. • Proper programs should be applied only on the basis of sound standards of performance. • Work measurement – Setting up those standards. • Material control – Workers and machines should not be idle because of non-availability of material and tools.

21. Reduce ineffective time within control of the worker • Training. • Make worker want to reduce ineffective time. (Create conditions to make the worker get on with his work. Hawthorne effect) • Effective personnel policy and management’s attitude towards the worker. • Good relationship between management and worker. • A sound wage structure, including incentive schemes (typically based on time standards derived from work measurement).

22. Work study • Technique used in the examination of human work in all contexts, and which lead systematically to the investigation of all the factors which affect the efficiency and economy of the situation being reviewed, in order to effect improvement. • Two branches – method study and work measurement. • Widely known as “time and motion study.” • Rapid developments after World War II. • Huge capital investment in process R&D may increase productivity. However, it is expensive and time consuming. • Work study focuses on human workers and can increase productivity at a lower cost.

23. Work study • Since line managers are typically busy with the day-to-day activities, they can only look at work study during their free time. They should not be entrusted with the work study responsibilities. • Workers also ruled out because they usually lack the knowledge of the big picture. • Therefore, responsibility should be given to someone who can work full-time on work study, without direct management duties. • Someone in the staff and not a line position.

24. Work study: A tool for management • Means of raising productivity (and efficiency) of the factory by reorganization of work. • Typically involves low or no capital expenditure. • Systematic process – Covers all aspects of raising productivity. • Very accurate in setting standards of performance. • Savings from work study start at once and continues as long as the improved operations are performed. • Applied everywhere: not only in manufacturing shops, offices, shops, stores, laboratories; and service industries like restaurants, etc. • One of the most penetrating tools of investigation available to management.

25. Work study: Beyond systematic • Should be applied continuously, and throughout the organization. • Basis of successful work study: complete intolerance of waste in any form – whether of material, time, effort or human ability.

26. Techniques of work study • Method study – Systematic recording and critical examination of existing and proposed ways of doing work, as a means of developing and applying easier and more effective methods and reducing costs. • Work measurement – 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. • Method study is associated with the reduction of the work content of a job or operation, while work measurement is mostly concerned with the investigation and reduction of any ineffective time associated with it.

27. Basic procedure of work study • Select the job or process to be studied. • Record from the direct observations everything that happens. • Examine the recorded facts critically and challenge everything that is done. • Develop most economic method taking in to considerations all circumstances. • Measure the quantity of work involved in the method selected and calculate a standard time for doing it. • Define the new method and time to standardize. • Institutionalize the new method and time as practice. • Maintain the new standards by control procedures.

28. Method study

29. Objectives • Improvement of processes and procedures. • Improvements of factory, shop and workplace layout and of design of plant and equipment. • Economy of human efforts and the reduction of unnecessary fatigue. • Improvement in the use of materials, machines and manpower. • The development of a better physical working environment.

30. Selecting the work to be studied • Economic considerations Bottlenecks Movements of material over long distances Operations involving repetitive work • Technical considerations Relatively straight forward Based on the technical knowledge of the process • Human considerations Most difficult to foretell – because of mental and emotional nature. Select an unpopular job for method study.

31. Important considerations • Product and operation • Person who proposed investigation • Reason for proposal • Particulars of the job • Equipment • Layout • Product • Savings and/or increase in productivity expected.

32. Charts indicating process sequence - Outline process chart - Flow process chart – Man, Material and Equipment type - Two-handed process chart Charts using a time scale - Multiple activity chart - Simo chart - PMTS chart Method study charts and diagrams • Diagrams indicating movement • - Flow diagram - Chronocyclegraph • - Sting diagram - Travel chart • - Cyclograph

33. Method study charts and diagrams • Outline process chart: Is a process chart giving an overall-picture by recording in sequence only the main operations and inspections. • Flow process chart: A chart setting out the sequence of flow of a product or a procedure b recording all events under review using the appropriate chart symbols. Man-type – Records what the worker does Material-type – Records what happens to materials. Equipment-type – Records how the equipment is used.

34. Why charts? • It gives a complete picture of what is being done and helps to understand the facts and its relationship to one another. • Details on the chart must be obtained from direct observation. Should not be from memory. • Neatness and accuracy important. • Increased value if following is included: • Product, equipment details (code#, drawing#) • Job or process being carried out • Location and time (date) of the study • Observer’s name • Chart reference number

35. Examine critically • Means by which each activity is subjected to a systematic and progressive series of questions. • Grouping of activities: Five sets of activities can be grouped in two categories • Those in which something actually happens to the work-piece (it is moved, worked upon or examined) • Those in which it is not being touched (in storage or in delay) • Objective is to maximize proportion of “do” activities. • All other activities, however necessary, are considered “non-productive.”

36. Primary questions • The PURPOSE for which • The PLACE at which • The SEQUENCE in which • The PERSON by whom • The MEANS by which ……………………….…………the activities are undertaken. With a view to ELIMINATING, COMBINING, REARRANGING, or SIMPLIFYING those activities.

37. Primary questions

38. The secondary questions

39. Facility layout

40. Facility layout: Method study considerations • Important considerations: Easiest flow of material, at the lowest cost and with minimum handling. • Essentially a work study problem. • More recently, because of cost minimization aspects, Operations personnel solves the layout problem. • Work study methods: Flow diagram and process flow chart. • Flow diagram – 3D diagram and/or model, 2D cardboard models and 3D wood/plastic models. • Ensure that diagrams/models are to the scale. • Err on the safe side. • CAD models more common now.

41. Facility layout: Method study considerations • Start with the flow diagram/model. • Map all the material movements on the flow diagram/model. • Measure distances of travel (computer output, thread method, drawing lines on the diagram etc.) • Analyze the current practice using a flow chart. • Go through the usual rounds of primary and secondary questions. • Develop the improved method.

42. Material handling

43. Material handling • Typically material handing may take up to 85% of the total process time. • Only important method study principle: Motion Economy! • Material handling adds to the cost of manufacture but adds nothing to the value of the product. • Therefore, ideally there should be no material handling. • Typical material handling problem solved in the same way as all method study problem – start with asking questions. • Most important question: WHY is this handling done?

44. Material handling: Process • Traditional way of solving any method study problems • Use of outline and process flow charts and flow diagrams to ensure a correct workplace layout. • AIM: Minimization of movement in any plane – horizontal or vertical. • Specially critical when one is buying material handling equipment for the workplace. • Change in workplace layout affects not only the quantity but also the type of material handling equipment necessary.

45. Material handling: Important aspects • Always try to keep material at the height at which they are to be worked upon. • Never keep material on floor. • Always keep distances over which material is handled as short as possible. • Let gravity work for you. • Always handle in bulk over distances. • Always have sufficient boxes, platforms or container available at the workplace. • Keep gangways clear. • Don’t reduce the supplementary human labor if it means increase in the load for direct operators.

46. Movement of workers

47. Effects of shop layout on worker movement There are many activities in which workers move at irregular intervals between a number of points in the working area, with or without material. This happens when, • Bulk material is fed to or removed from a continuous process. • An operator is looking after two or more machines. • Laborers are delivering material to or removing work from a series of machines. • In stores and shops when variety of materials are being removed from or put away into racks or bins. • In restaurants and canteens kitchens during preparation of meal.

48. String diagram A scale plan or model on which a thread is used to trace and measure the path of workers, material or equipment during a specified sequence of events. • A special form of flow diagram, in which a thread is used to measure distance. • Necessary that the string diagram be drawn correctly to scale, whereas regular flow diagram can be drawn only approximately to scale. • Start using the string diagram by recording all the relevant facts from direct observation. • Like flow diagram, it will most often be used to supplement a flow process chart.

49. String diagram • Thus, string diagram and flow chart can give clearest possible picture of what is actually being done. • Flow process chart will be examined critically in order to make sure that all unnecessary activities are eliminated before a new method is proposed and tested using string diagram. • String diagram can be used to plot movements of material to know how far the materials travel. • Most commonly, the string diagram is used for plotting the movements of workers.

50. String diagram: Process • A scale plan of working area similar to that required for a flow diagram must be made; as stated earlier, with higher accuracy. • Machines, benches, stores etc. should be drawn to scale, together with doorways, pillars, partitions. • Completed plan should be attached to a softwood board and pins driven into it firmly at every stopping point, the heads being allowed to stand well clear of the surface. • Pins should also be driven in at all the turning points on the route. • A measured length of thread is then taken and tied around the pin at the starting point of the movements.