Prof.lamba Productivity

8/12/2019 Prof.lamba Productivity

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Productivity Concept,

Measurement and ImprovementWhat is Productivity?

ILO defines Productivity as the ratio between Output ofWorkand Inputof Resources.

Productivity= Output Input

ProcessInput Output

Waste

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This definition applies to an enterprise, anindustry or an economy as a whole.

Productivity is simply the ratio between theamount produced and amount of resources usedin the course of production.

These resources can be: (Unit of resources is inbrackets.)

1. Land (Hectares)

2. Material (Metric Tonne)

3. Plant and Machinery (Machine Hours)4. People (Man Hour)

5. Capital (Rupees)

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Productivity Improvement

To enhance productivity ,reduce cost,

eliminate waste

Deals with man machine systems

Consists of : selection of tools and techniques.

- development of time standards- installation of wage incentives

- value engineering,value analysis

- project feasibility studies


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Partial productivity

Partial productivity is defined as the ratio of outputto any one class of input i.e either material,capital, labour or energy

Labour productivity = OutputLabour hours


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Total productivity

Total productivity is defined as the ratio of totaloutput to the sum of all input factors.

= Total output

Total input

Total input = Labour+ Material + Capital +

Energy + Other expenses

Converted to a common measurable factor


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Controllable or Internal factors

Product extent to which it meets requirements. Plant and equipment availability and reduction of

idle time.

Technology automation. Material and Energy - reduce material and energy

consumption. Human factors motivation and training.

Work methods improvement in the way of doingthings. Management style communication, policy and

procedures.


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Non controllable or external factors.

Natural resources manpower, land and raw

materials

Government and infrastructure government

policies ,transport, power, fiscal policies.


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Is Productivity different from

Performance? Productivity takes into account output in relation

to input. Performance takes into account output only.

Productivity =Output Input In performance, we consider only the output and

not the input. A performance index becomes comparison of

actual output with some standard or expectedoutput. Performance Index = Actual work done Ideal or

standard expected work.

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Example:

It takes 3 Mtrs. cloth to make a coat.

In a day a person is expected to make 50 coats.

He makes 40 coats from 111 Mtrs. Of cloth.

What is his Performance ?

- 40 coats Performance Index ?

- {40 50} x100= 80%

What is his cloth productivity index?

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- Normally he should have used 120 Mtrs. cloth.

However he managed to make 40 coats in 111Mtrs.

- Cloth Productivity Index = {120 111} x 100=108%

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Improving Productivity Needs to be organisationsfocus area:

Need a vision, mission and periodic goals for

measurement and improvement of productivity Customer Orientation strategy to provide

same quality of service at lower cost or betterservice at same cost

Empowerment of workers and staff Encourage creativity Right people for right jobs Use of right techniques


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Inventory control, material handling systems etc.reduce the time, space, effort and moneyinvolved in making material available for its time

and place utility. Techniques like work-study, ergonomics, etc

eliminate motions that are non-productive ormake them easy to perform are included in thehuman factor.

Today, Lean Production System approach is aholistic one, which covers all areas of

productivity improvement.

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Improving Productivity

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Few other techniques like JIT, TPM, TQC,KAIZEN, Quality Circles can be appliedsimultaneously.

SummaryA. Technology Based

- CAD, CAM, Integrated CAM, Robotics, Laser

Beam Technology, Energy Technology, GroupTechnology, Computer Graphics, Simulation,Maintenance Management, Rebuilding OldMachinery, Energy Conservation.

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Employee Based

- Financial Incentives, Group Incentives, FringeBenefits, Promotions, Job Enrichment, Job

Enlargement, Job Rotation, WorkerParticipation, MBO, Skill Enhancement, LearningCurve, Working Condition Improvement,Communication, Zero Defects, Punishment,

Recognition, Quality Circles, Training, Education,Role Perception, Supervision Quality.

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Where to Begin

Benchmarking internal and external


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Strategic KPIs

Top

Management

Tactical KPIs

Country Management and

Departmental Heads

Operational KPIs

Operational Managers

M&S LgsM&S / Fin

M&S Lgs

KPIs Monitoring and Control Process


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Strategic and Operations KPIs for

OpCos

Commercial Indicators on following slides

Source Dimensions Business Questions Report Contents Focus

Market

/Risks

1.- Market DescriptionTo understand market development stage

GDPGDP Construction

Import Export

Market Size / Capacity

MIC Integration

2.- Market StructureIs market structure changing?

Is it a threat? From whom?

Product Split

Prices

IntegrationConcentration

3.- OpCos Market PositionIs our future position as a supplier at risk? Fromwhom?

Channel Mgmt

MIC Supply

Clinker Factor

OpCo 4.- Commercial PerformanceHow are we profiting from our market

opportunities?

Commercial Margin

Branding

Distribution Cost

Distribution Service

5.- EfficiencyHow productive are we?

Expenses

Personnel

Branding

Credit Management

STRATEGIC

M

ARKET

DES

CRIPTION

COMMERCIAL

OPERA

TIONS

Corporate

O

pC

o


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% Increase inGross Margin

throughImprovementInitiatives

%increase involume committedthrough contracts

per quarter(Transformational

Sales)

Ratio of salesthrough

transformationalchannels to sales

throughtransactional

channels

No. of FTEs in OutBound Logisticsper 1,000 Tons

No. of FTE in Salesper 1,000 Tons

Total DeliveredCost per Ton

CustomerSatisfaction Index

CementDispatched per

Day in Tons

Strategic KPIs

2

3

4

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7

8

9EBIDTA %

1

Strategic KPIs


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Return onInvestment for

installing silos atcustomer site

Marketing& Sales

% volumecommitted

through contract(Transformation

al Sales)

Time required toconvert enquiry

to contract

Percentage ofprospects

converted ascustomers (Hit

Ratio)

Number ofprospects lost tocompetitors per

quarter

% Variance ofAnnual Sales

Plan

1

2

3

4

5

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Tactical KPIs Marketing & Sales (1/2)


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O2C FinalPresentation

Additional cost

incurred due toswap sales

% Success ofsales strategy

Marketing& Sales

CementDispatched per

day in Tons

Marketing andSales Expensesin % of net sales

(%)

% Improvementin CSI index

% Increase in

market sharedue to customer

service events

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10

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% Increase inmarket share

due to customerservice events

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Tactical KPIs Marketing & Sales (2/2)


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Operating ProfitMargin (%)

Reduction innumber of cases

for overduepayments in a

quarter

Marketing& Sales /Finance

No of casesrejected in credit

check in aquarter

% Deviations incomplying to

creditassessment

guidelines in ayear

Days salesoutstanding

Aging Analysisof AccountsReceivables

2

3

4

6

EBIDTA (%)

1

5

Tactical KPIs Marketing & Sales / Finance


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Distribution Costsper Ton

Logistics

Order ManagementCosts

Order FulfillmentCycle Time

Performance relatedto On Time Delivery

for Export Orders(Performance

measured from

committed date toloading of Ship)

% compliance of3PL against SLAs

% Success rate with3PL Prospects peryear (% Logistics

Contractorsgraduated to level of

3PL)

1

2

3

4

5

7

% Forecastaccuracy of

annual dispatchplan at

disaggregatedlevel

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Tactical KPIs Logistics (1/2)


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% Variance ofvolumes from

budget

Logistics

% Improvement inOn Time Delivery

per Year

% Reduction inTotal Logistics Cost

per year

% Variance oflogistics costs from

budget

% CapacityUtilization of

logistics

infrastructure

Total Cost saved dueto Cross-Docking in

a year

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Tactical KPIs Logistics (2/2)


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No. of ordershandled with

exceptions

Marketing &Sales

% Compliance toprocess enquiries on

time

Time required to

process the enquiry:Time from thereceipt of enquiresto submission of

quotation

Receive, enter &validate order cycle

time

No. of Credit / DebitNotes issued per

month

% increase innumber of

transformationalcustomers

1

2

3

4

5

6

Operational KPIs Marketing & Sales (1/3)


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% customer needsrepresented in list of

customer serviceevents

Marketing &Sales

Average timerequired to capture

customer orderthrough customer

care centre

Average Cost toReceive, Enter &Validate Order

Number of caseswhere paymentdishonoured in a

quarter

% orders capturedthrough webSALES

in a year

Average timerequired to create /amend Customerrelated masters

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PromotionalExpenses per

Region/ Sales Unitper Quarter

Marketing &Sales

No. of changes doneto Customer Service

Calendar per year

No of innovativecustomer serviceevents identified per

year

Number of ordersswapped/diverted

per Quarter

Average Timerequired from

receipt to resolutionof Customer

Complaints

% Reduction innumber of

complaints per1,000 tons

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Number ofenquiries

received perquarter per Key

account manager

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Average time takenfor loading 1,000tons for Exports

from plant to ship

Logistics

% Fill Rate: Thepercentage of ship-from-stock ordersshipped within 24

hours of order

receipt

Average time

required forarranging the

vehicle for deliveryof Customer Order

Loading Cycle Time:Average tonnage

loaded per hour of a

product

% compliance toStock Transfer Plan

Average Gate In toGate Out Cycle time

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2

3

4

5

6

Operational KPIs Logistics (1/3)


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Demurrage /Wharfrage paid per

Quarter fordomestic and

exports

Logistics

Average totalinventory tonnage

per month ofcement at various

stock points

Average Waitingtime in lorry yard

per lorry

Total Time requiredfor preparation and

completion ofAnnual Dispatch

Plan

Cost to Package

Average time takenfor un-loading the

ships / barge/trucks in case ofStock Transfers

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% Tonnage utilisedfor backhauling

operations (ratio ofdispatches to a

region/backhauling)

Logistics

## Cost to Invoice

Average time

between productdelivery and receiptof POD at the point

of dispatch

% orders fulfilled onthe committed date

Number of stockouts per stock point

per quarter

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1516

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## This KPI ownership varies from company to company


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Partial Productivity

Definition

Ratio of output to one class of input.

At a given time it considers only one input andignores all other inputs.

Its significance lies in its focus on utilization ofone resource.

For instance, labour productivity is measuredusing utilization of labour hours; whereas capitalproductivity is measured in Rupees.

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Case:

- As a part of new assignment, Manager of Pop-CornProducts was asked to identify areas for productivity

improvements. He collected data on all inputs and outputsof previous years operations being transferred intoequivalent of money units. The table below gives detailswith all figures in lakh of rupees.

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OUTPUT 1000

INPUT

Human 300

Material 200

Capital 300Energy 100

Other Expenses 50

Parag plans to calculate values of partial productivity to aid in his study. Pleasehelp him in his endevour.

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Solution:

- Partial productivity of various inputs is as

follows: Human productivity= 1000300= 3.3

Material Productivity= 1000200=5.0

Capital Productivity= 1000 300 =3.3

Energy Productivity= 1000 100= 10.0

Productivity of other expenses= 100050=20.0

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Advantages Disadvantages

Easy to understand Misleading if used alone.

Easy to obtain data Cannot explain overallcost increase

Diagnostic tool topinpoint areas ofimprovement

Profit control is notprecise

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Total Factor Productivity

In an effort to improve productivity of labour,company may install more machinery.

Then productivity of labour will go up bringing

down the capital productivity. Partial productivity that typically uses only one

resource at a time fails to grasp this paradox.

Historically labour and capital were considered tobe the most significant in contribution in theprocess of production.

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Total Factor Productivity model developed by John

W. Kendrick in 1951, has taken only labour andcapital as only two input factors.

For instance, Products worth Rs 100 lakhs weremanufactured and sold in a month. It consumed

Rs 20 lakhs worth labour hours and Rs 55 lakhsworth capital.

- The Factor Productivity = 100 (20+55)= 1.33

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Advantage Disadvantage

Data is easy to obtain Does not consider impact ofmaterial and energy inputs,

though material typicallyforms 60% of the productcost.

Appealing from theviewpoint of the corporate

and the National economist.

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Multi-factor Model of Productivity

Developed by Scott D. Sink Multi-factorProductivity Measurement Model consideredLabour, Material and Energy as major inputs.

Capital was deliberately left out as it is mostdifficult to estimate how much capital is beingconsumed per unit/ time.

The concept of depreciation used by accountantsmake it further difficult to estimate actual capitalbeing consumed.

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Total Productivity Model

Total Productivity Model developed by David J.Sumanth in 1979 considered 5 items as inputs.

These are Men, Material, Money (Capital),

Energy and other expenses.

This model can be applied in any manufacturingor service organization.

Total Productivity= Total Tangible Output TotalTangible Input.

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Advantages Disadvantages

All quantifiable inputs are considered. Data is difficult to compute.

Sensitivity analysis can be done. Does not consider intangible factors ofinput and output.

Provides both firm level andoperational unit level productivity.

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American Productivity Centre (APC)

Model

American Productivity Centre has beenadvocating a productivity measure that relatesprofitability with productivity and price recovery

factor. Profitability= Sales Costs

{Output Quantities x Prices} {Input Quantitiesx Unit Costs}

Productivity x Price Recovery Factor.

The APC model is different from other models inits treatment, by inclusion of Price Recovery

Factor.

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What is price recovery factor?

It is a factor that captures the effect of inflation.

The changes in this factor over time indicatewhether changes in input costs are absorbed,passed on, or overcompensated for, in the price of

the firmsoutput. Thus inclusion of this factor will show whether

gains or losses of a firm are due to changes inproductivity or it merely indicates the fluctuations

in the prices of material consumed and sold.

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ILO Approach to Productivity Improvement

The classic ILO approach is Task Based.

It breaks manufacturing time into basic workcontent, added work content, and ineffective time.

The main focus is on reducing inefficient time inthe total work content.

A. The Basic Work Content

- The amount of work containedin a given productor process measured in man-hours or machinehours.

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- The basic work content is the irreducibleminimum time theoretically required to produce

one unit of output.B. Added Work Content

(1)Work content added by defects in the design orspecification of the product. It may be due to lackof standardization and/or incorrect qualitystandards.

- This additional work content is the time taken over

and above the time of the basic work content duetofeatures inherent in the productwhich could beeliminated.

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(2) Work content added by inefficient methods of

production or operation.- This is the time taken over and above the basicwork content plus (1), due to inefficienciesinherent in the process or method of

manufacture or operation.- This includes wrong machine used, processes

operated in bad conditions, wrong tools used,bad layout, operatorsbad working methods etc.

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C. Ineffective time

- All interruptions which cause the worker ormachine or both to cease producing or carryingout the operations on which they are supposed tobe engaged.

- Irrespective of the cause, these must be regardedas ineffective time because no work towardscompleting the operation in hand is being doneduring the period of the interruption.

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(1) Ineffective time due to shortcomings on the part

of the management.- Time during which man or machine or both areidle because management failed to plan, direct,coordinate or control efficiently.

(2) Ineffective time within the control of the worker.- Time during which man or machine or both are

idle for the reasons within the control of theworker himself.

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Focus on reducing added work content &

inefficient time in the total work content Following are the methods by which added work

content & inefficient time can be reduced.

By reducing

1. Poor design and frequent design changes

2. Waste of materials

3. Incorrect quality standards

4. Poor layout and poor utilization of space5. Inadequate material handling

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Frequent stoppage in production

Ineffective method of work

Poor planning of work

Frequent breakdowns

Absenteeism & late coming Poor workmanship

Accidents and occupational hazards.

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Quality Circles Quality Circles were the logical consequence of

the various waste elimination programmes thatwere run in many Japanese corporations in earlyfifties.

It provided a platform for the workers to gettogether and use techniques for their quest forcontinuous self-development and organizationalimprovement.

In 1980, the first Quality Circle was launched inHyderabad plant of Bharat Heavy ElectricalsLimited.

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Definition and Meaning

Quality Circle is a small group of employees in thesame work area or doing a similar type of workwho voluntarily meet regularly for about an hour

every week to identify, analyze and resolve workrelated problems, leading to improvement in theirtotal performance ad enrichment of their work life.

This definition is quite comprehensive and most

commonly accepted. Every part of the definition is significant.

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Why small group of employees?

- Experience indicates that the optimum number ofa Q.C. is about eight to ten.

- If a circle is formed with less than five members,one can imagine the strength of the group when

absenteeism is high.- Interaction and participation becomes more

pronounced when group members are more thansay, six.

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Why in the same work area or doing similar

type of work?- This ensures Q.C. to be a homogeneous and

cohesive group

- The discussion that takes place remains

interesting to everyone only if members are fromthe same background.

- It also helps the members to understand theintricacies of the problem.

- Also the application of QC tools that arerecommended require the expertise in the field.

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Why is participation voluntary?

- Voluntary in the Japanese context has a

different interpretation as compared to whatis normally understood in the Indian context.

- To the Japanese , the very word voluntaryimplies 100% participation.

- Hence, when a company in Japan decides toimplement Quality Circle, every body has toenroll as a member.

- Japanese have refrained from using fromusing the word compulsoryas it indicates notjust 100% participation but achievement oftargets as well.

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Quality circle requires some amount of creativitythat is not under control, therefore, the word

voluntary is used to indicate that achievingtargets is not mandatory, but participation iscompulsory.

In India the term voluntary has been used to

circumvent the possible opposition from thetrade unions.

Why to meet regularly for an hour every week?

Meeting regularly is absolutely essential for thesuccess of Q.C.

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If the meetings are kept at longer intervals thencancellation of one or two meetings will furtherlengthen the interval leading to complete

stoppage of work.

Why to analyze and resolve work relatedproblems?

As employees know more about their own workarea than any body else, they are in a betterposition to solve problems occurring there.

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Structure of Quality CircleSteering Committee/

DepartmentalCommittee

Top Management

TMSteering Committee

FacilitatorLeader/Deputy Leader

MemberNon Member

Coordinatingcentre

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Role of Each ElementNon-Members

- Initially, all the employees in a particular work area may

not volunteer in joining QC activity.

- Some others may not be interested in activity but prefer

not to get directly into it.- QC members must understand that solutions they find

cannot be implemented without the cooperation of these

non-members.

- Members must encourage non-members to participate inactivities so that they change their attitudes and form

circle on their own.

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Members

- Members must be restricted to grass root level

persons.- If membership is kept open only to officers and

executive, the very purpose of QC gets defeated.

- Members actively participate in selecting problemsof their concern, analyzing it, finding solution to itand finally making presentation to themanagement.

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Leader/Dy. Leader

- In Japan, first line supervisors are nominated as

leaders.- However, in India, it is advisable to make

members choose their own leader.

- Earlier there used to be only one person asleader.

- But considering heavy absenteeism that prevailsin our country, there can be one deputy leader

who will take charge in absence of leader.

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The leader or the deputy leadersendeavour is

- To maintain cohesiveness of the team.

- To plan agenda for meetings.

- To ensure participation from every member byassigning them work.

- To encourage consensus decision making process.

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Facilitator

- Facilitator is the senior officer of the departmentwhere QC is working and is nominated bymanagement.

The facilitator- Can facilitate more than one QC.

- Is responsible for success of QCs operating inhis area.

- Ensures necessary facilities are available to theteam for operation.

- Joins Steering Committee meetings and gives

results of activities of QC.

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Steering Committee

- The committee comprises of heads of majorfunctions as members and chief executive as thechairman.

- The committee makes top managementssupport

visible. Steering committee

- Meets regularly once in two months.

- Takes overview of QC activity in entire

organization.

- Gives policy guidelines fr the propagation ofmovement

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Coordinating Agency

- The job of coordinating agency is similar to facilitator but on

a large scale.- It coordinates QC activities throughout the organization.

- Steering committee decides the composition of coordinatingagency.

Coordinating agency- Organizes a training programme for members when QC is

formed.

- Evolves norms to assess performance of different QCs.

- Prepares budget for QC activity.- Miscellaneous work eg. Inviting Guest Speaker or making library

facilities available

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Top Management

- Top Management does not fall within the formal

structure of QC.

- Its main job is to

Convey its commitment to all employees

Extend necessary support by attending conventions andsanctioning funds.

Form quality council and establish a conduciveatmosphere.

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Quality Control Tools

Quality circles use certain basic tools to identify,analyze, and resolve their problems, called QC tools.

A. Stratification

Stratification refers to segregation of problem areainto smaller units so that each can be taken more

effectively.

What appears to be a single problem may actuallyconsist of a set of problems, each with a different root

cause.

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For instance, the problem of Lowoutput during thedaymay have different set of causes during the first

and second shift.

There is no way of knowing the correct way ofstratifying the problem but when faced with a

problem, one needs to use his skills and expertise tobe able to do good stratification.

The underlying principle is that when you find aproblem, break into sub problems and find out the root

cause of each.

This procedure becomes faster and simpler.

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Examples of StratificationOperation

Wise

Skill, Experience, Years in job, Gender, individual,

Union, Educational qualification.

Machinery Type of machine, Machine number, order new, structure,functions, moulds, jigs etc.

Material Wise Maker, lot, date of arrival, date of use, Type, constituents,

storage period, storage place, production place.Method Wise Operation method, place of operation, Temperature,

Humidity, Pressure, No. of revolutions, speed, sampling etc.

Time Wise Day, day and night, shift (in case of shifts), days of the week,month, normal day and the day after holiday, immediatelyafter commencement, right before end, hour, around machineadjustment.

Product Wise Lot, vendor, New & old products, standards, special products.Etc.

Inspection,calibration

Inspector, Testing machine, Gauge, person in charge ofcalibration, place of calibration.

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B. Check Sheet or Tally Table

A data-recording tool where the frequencies of each

type are marked against it. The frequencies against each will indicate its relative

importance and subsequently help in drawing pareto

diagramme.

Sr.No.

Cause Tally Marks Frequency Remarks

1. Broken Pin //// // 7 -

2 Broken Link /// 3 -

3 Loose contact //// //// // 12 -

4 No Power // 2 Known Before

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C. Pareto Analysis

This technique was developed by Italian economist

Pareto which showed that 20% population of a countrycontrols 80% wealth and vice versa.

This is applicable in most cases and is called 80-20

principle. Along these lines, Pareto diagramme can be drawn byfinding out which 20% causes create 80% problems.

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Paretos Analysis- A Case Study- Cause of decline in production

in Rubber component manufacturing company.

Code Item Causes Time (Min) Time(Min)/Case

A Rubber Recovering 16 145 9.1

B Repair Delays 3 255 85.0

C Repairs 5 344 68.8

D Adjustments 12 206 17.2

E Preparations 48 232 4.8

F Component Search 5 137 27.4

G ComponentReplacement

9 110 12.2

H Raw Material Delay 2 780 390

I Miscellaneous 17 303 17.8

Total 117 2512 21.5

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It can be seen problem H consumes most of the time.

If we take care of this problem then there will be adramatic increase in productivity as compared to

taking other problems in the beginning.

Thus the important problems need to be tackled on top

priority.

D Histogram

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D. Histogram

Histogram is also called frequency distribution chartand represents the condition of variance through the

chart . It is a visual presentation of the spread on distribution

of data to monitor a process and determine itsconsistency in meeting customersrequirements.

The population in the data is classified on the basis oftheir similarity into different groups or classes.

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Each class or group is classified on the basis of theirsimilarity into different groups or classes.

Each class or group is represented by a rectangle or abar.

The class interval or causes of the problem or defectsare placed on x-axis and frequencies or the number of

defects is placed on the y-axis.

The height of each bar is proportional to the number offrequency of its class interval and each bar should be

of same width.

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U f Hi t84


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Uses of Histogram

The shape of the diagram reveals the mean valuevariance.

By frequency distribution chart the standard deviationand mean deviation can be calculated.

By comparing with rated value, the process efficiencyand rate of defective goods could be calculated.

By visualizing variances, abnormalities come to light.

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E. Ishikawa or Fish Bone Diagram (Cause and Effect

Diagram)

Investigative tool developed by Dr. Ishikawa of Japan.

This diagramme is arrangement of all possible causes,which give rise to the effect or problem in hand.

Prior to plotting this diagramme, it is necessary to listdown all possible causes by brain storming, so that no

important cause is missed.

They are segmented broadly into four Ms viz Men,

Machine, Method, and Material.

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Final Effect

MachinesMen

MaterialsMethod

Sub cause

Sub cause

Sub cause

Sub cause

F C t l Ch t

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F. Control Charts

Control charts are used to investigate whether the

manufacturing process is in stable condition or not andis used to maintain the manufacturing process in stable

condition.

Central line (CL), upper control line (UCL), and lower

control limit (LCL) are the main three lines whichconstitute a control chart.

CL

U C L

LCL

X (bar) Charts

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X (bar) Charts

Central Line =Grand Mean

UCL= Grand Mean + A2 x Mean Range LCL= Grand Mean - A2 x Mean Range

R (bar) Charts

Central Line= Mean Range

UCL= D3 x Mean Range

LCL= D4 x Mean Range

C ti it B d T h i

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Creativity Based Techniques Innovators have known since long that the process of

generating ideas is not logical or analytical process; itis a creative process.

Some of the commonly used creativity techniques are:

(1) Brainstorming

- Brainstorming is defined as a means of getting large

number of ideas from a group of people in a short

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Often good ideas are under the bad ones in the brain

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- Often good ideas are under the bad ones in the brain

and unless the bad ideas are permitted to exit, the good

ones do not surface.(b) A group of people

- Brainstorming is a group process.

- The optimum size of a group is about twelve; but it can

vary between six to twenty.- Ideally the group should be heterogeneous, with as

much diversity in gender, age, qualifications and

experience, as possible.

- Such heterogeneity permits observation of problem

from different view points, which is the crux of the

brainstorming process.

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( )

- This refers to the rate of flow of ideas.

- This rate can be as high as one hundred ideas in a

period of ten minutes.

- Once again, the emphasis is on quantity.

The success of Brainstorming

- Following four basic guidelines can ensure the successof a brainstorming process.

(a) Suspend judgment

- Just listen and list the ideas.

- Do not try to judge or evaluate any idea till you finish

the session

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(b) Encourage free-wheeling of ideas

- Permit wild ideas; encourage dreaming, and thinking

around the problem.

(c)Quantity

- Go for quantity i.e. number of ideas.

- Do not examine quality or feasibility of idea at thisstage.

(d) Cross fertilization of ideas

- Encourage members of the brainstorming group to hitch

hike on each othersideas.

- Show no interest in identification of ownership of each

idea.

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The Stages of Brainstorming

The process of brainstorming consists of six stages(1) Stating the problem

- All the participants of brainstorming sessions must

know some details of the problem.

- Therefore, in the first stage, we need to state the

problem and try to provide some information about

it.

(2) Re-stating the problem

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- Ask the participants to look at the problem in a

different ways and identify as many facets of it as they

can.

- Participants restate the same problem depending on

the way they look at it.

- If the problem is looked at from many angles, itbecomes easy to generate a large number of solutions.

(3) Select a basic re-statement

- After listing down all the re-statements, select one or

two of these as a lead to brainstorming session.

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- This selection is done by the leader alone.

- This stage must be closed with a clear definition of theobjective of the brainstorming session i.e. expected

outcome.

- If this is not done, the session could easily turn into a

gossipsession.(4) Warm up

- In this stage participants do free-wheeling for the

purpose of actual generation of ideas.

- Some participants observe silence for a few minutes.

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- Silent meditation can be a great tool for use in this

stage.

(5) Idea generation

- Generally participants sit in circle.

- The leader displays the selected statement and invites

ideas.- People are encouraged to speak out the moment they

get an idea.

- The leader notes down each and every idea, without

evaluation or judgment.- The process goes on till the ideation dries up.

(6) Wild id

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(6) Wildest idea

- In this final stage, the group takes up the wildest of

the ideas and attempts to turn into something usefulfor further brainstorming.

- After this, the session is ended.

Dos and Don'ts of Brainstorming

Dos Don'ts

Suspend judgment Spend too long on initial discussion

Allow wild and silly ideas Allow observersHave a warm up session Tape record the proceedings

Encourage noise and laughter Accept interruptions

Take more than one statement of theproblem

Drag a session that has dried up.

(2) N i l G T h i

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(2) Nominal Group Technique

- In the Nominal Group Technique, a group of qualified

individuals come together to present their ideas andthen vote for the most favoured one.

- This idea is taken up as the decision of the group.

- The group is referred to as nominal since the group

members do not directly interact with each other.

- Every member works on the solution independently.


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Advantages & Disadvantages

It allows formation of an informed opinion.

Ranking of ideas by the group members is facilitated bysupplying information held by each member to all other

members. Fairly rapid process, permitting objective exchange of

ideas.

Requires a trained facilitator to run the session.

As it is important to remove the element of personal

bias and prejudices, it is advisable to record the ideas

without mentioning the name of the person giving it.

Latyeral Thinking - Definition and

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Latyeral Thinking - Definition and

Meaning

Lateral Thinking is defined as a thinking process inwhich we make deliberate attempts to generate new

ideas by introducing a discontinuity in our thought

process.

Lateral thinking implies considering a problem fromfresh perspective, a point o view which is different

from the norm, the obvious.

The change in perspective can be relaxing as well asproductive.

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Some examples are:

(a) Visualizing the extreme opposite of the situation or

reversing the objective.

- Suppose you want to bring down your high inventory

levels, try thinking what can be done to increase

inventory?- This might bring to light some inherent weaknesses

in the system.

- Even if you dontstrike the solution, you will at least

know what Not to do.

(b) Looking at the surroundings of the problem rather

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(b) Looking at the surroundings of the problem rather

than the problem itself.

- Suppose you have a machine that breaks downfrequently.

- Is it a machine designed for air-conditioned room but

kept at room temperature.

(c) Challenging the assumption

- Believe that your information is wrong.

- Try something that goes against the assumption.

- It may turn out that that some of the old ways can beimproved or replaced.

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The Principles of Lateral Thinking

(a)Background

- The need for Lateral Thinking arises from the fact that

dominance of an idea or concept suppresses other

useful and efficient ideas stopping the progress.- Dominance blocks the way to explore continuously

more and more useful and efficient ideas stopping the

progress.

(b) Escape

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(b) Escape

- This principle suggests recognition of the dominant idea

and deliberate search for alternate ways of doing things.- The search has to be for alternate ways and not for the

best way.

(c) Provocation

- This assumes that it may be necessary to be wrong at

some stage in order to reach the final right solution.

- Therefore, we use one idea to provoke or generate

another set of ideas, rather than checking its individualcorrectness.

Difference Between Conventional Thinking and

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Difference Between Conventional Thinking and

Lateral Thinking

Conventional (Vertical) Thinking Lateral Thinking

Conventionally we think to chose andprove something.

Here we think to generate and exploreideas.

It is in search of answers. It is in search of questions.

Uses information in its meaning. Uses information for its effect.

Seeks continuity i.e. expects one thingto follow another.

Seeks discontinuity.

Concentrates only on relevant factseliminating irrelevant facts. Doesnt consider anything asirrelevant.

It is a close ended procedure aimed atresult.

It is an open ended process givingmaximum results, but makes nopromise.

E l f H i h i l

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Examples of your Hemispherical

DominanceHow would you go about solving a problem? Would you follow an organized approach like defining

the problem and breaking into parts, conducting

research and recording possible solutions, eliminating

the non-viable solutions and then selecting the best of

the rest?

If yes, then you are probably a left dominant.

A right dominant person would try to see the picture asa whole, get a feel of what will work and place his

trust in hunches or gut feeling.

D l hi T h i i C i i


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Delphi Technique in Creativity

A method of pooling a large number of expertjudgments through a series of increasingly refined

questionnaires i.e. gathering the judgments of experts

for use in decision making.

Used for complex, unstructured problems, to developthe strong pros and cons for alternative solutions.

Based on generation of suggestions and arguments and

clustering on most favoured and least favouredalternatives.

The stages are:

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g

(1) Generation of individual opinions on the nature of

problem and possible solutions.(2) Tabulate results and show them to the group,

preserving anonymity.

(3) The most and least favoured opinions must be

restated, preserving anonymity.(4) The group members read the list of opinions and,

individually, re-state their opinions.

(5) Results are re-tabulated and shown to the group.

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Track suggested solutions.

Vote on alternatives, their desirability.

Vote on arguments, their importance and validity.

Delphi is based on anonymity of the group members.

Oriented towards avoiding any direct confrontation.

Decisions with Delphi express opinions rather thanfacts which require group members to be experts.

Delphi does not require physical presence.


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Work Study Work study is a generic term for those

techniques, method study and work

measurement which are used in the examinationof human work in all its contexts and which leadsystematically to the investigation of all thefactors which affect the efficiency and economy

of the situation being in order to effectimprovement.


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I

A

B

C

D Ineffective time - workers

Work content added by inefficient methods ofManufacture

Ineffective time - management

Work content added due to defects in design orspecification of products.

Basic work content of product or operation

Total WorkContent

Totalineffective

time

Totaltime of

operation


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Steps in a Work/ Method study Select

Record

Examine Develop

Define

Install

Maintain


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BOTTLENECK Work Centre/ Operation (Lesserspeedthan other operations)

FREQUENT REJECTION

HIGH REWORK/RECTIFICATION

FREQUENT FAILURE

HIGH CONGESTION

SELECTION OF JOB - TECHNICAL CONSIDERATIONS


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FREQUENT COMPLAINTS

KEY PERSONS WISH

POOR WORKING CONDITIONS (Reported byWORKERS/UNIONS)

SELECTION OF JOB - HUMAN CONSIDERATIONS

RECORD


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A. COMMONLY USED CHARTS/DIAGRAMS

CHARTS INDICATING PROCESS SEQUENCE

- OUTLINE PROCESS CHART-FLOW PROCESS CHART Man Type Matl Type M/c Type

CHARTS USING A TIME SCALE-MULTIPLE ACTIVITY CHART-SIMO CHART

DIAGRAMS INDICATING MOVEMENT-FLOW DIAGRAM-STRING DIAGRAM-CYCLEGRAPH/CRONO CYCLEGRAPH-TRAVEL CHART

B .PROCESS CHART SYMBOLS


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B .PROCESS CHART SYMBOLS

OPERATION DELAY

INSPECTION

TRANSPORTATION

STORAGE

COMBINED

CRITICAL EXAMINATION


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* WHATis actually achieved? ELIMINATE * What else

* WHYis activity necessary at all? Unnecessary part of

job

* What should

PLACE

* WHERE is it being done ? COMBINE * Where else

* WHYis it done there only ? Wherever possible * Where should

TIME / SEQUENCE

* WHEN is it done at that time only REARRANGE Whenelse the sequence of

operation for more

effective results

* When else

* When should

PERSON

* WHO is doing it ? * Who else

* WHY is it done by that person only ? * Who should

MEANS/METHOD

* HOW is it being done ? SIMPLIFY * How else

* WHY is it being done in that way only ? Operations * How should


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DEFINE

INSTALL

MAINTAIN


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Motion study

Rules of motion economy

Rules concerning:

Human body Workplace layout and material handling

Time conservation

Tools and equipment design


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TIME STUDY : SELECTING/ TIMING THE JOB

Select Job

New

Improved process (MATL; Method)

BottlenecksDisputes

Incentives

Low output/ High cost

Comparing alternatives


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SELECT WORKER

Qualified vs RepresentativeFast vs Union

One vs Several

SOME CAUTIONS

Understand correct method and problems.Develop credentials/confidenceNo hiding

Stand and StudyTake care of interest of workers and organisation

TIME STUDY : THE EQUIPMENT


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TIME STUDY : THE EQUIPMENT

Time Studyis a work measurement technique for recording

times and rates of working for the elements of a specified jobcarried out under specified conditions, and for analysing the

data so as to obtain the time necessary for carrying out job

at a defined level of performance.

Basic time study equipment:

Stop watch a study board

time study form

small calculator

clock with seconds hand

measuring instruments such as a tape measure,

steel rule, spring balance, tacho meter.


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An element is a distinct part of a specified jobselected for convenience of observation,

measurement and analysis.

A Work cycleis the sequence of elements which arerequired to perform a job yield a unit of production.

Sequence may some times include occasional

elements.

Timing Each Element


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Timing Each Element

Cumulative timings

Fly back timings.

A detailed breakdown is necessary ( element level)

Productive work to be separated from unproductive .

To rate work more accurately

To enable the different type of elements to be separated fordifferential treatment.

To enable the element with high degree of fatigue.

To facilitate details of methods.

To enable a detailed work specification.


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RATING

Rating is the assessment of workersrate of working relative tothe observersconcept of rate corresponding to standard pace.

Standard performance is the rate of output which qualified

workers will naturally achieve without over-exertion as an

average over the working day or shift provided that they knowand adhere to the specified method or provided that they are

motivated to apply them selves to their work.

The performance is denoted as 100 on the standard rating and

performance scale.

Rating converts observed time into normal time

Normal time = observed time X performance rating

Standard Time :


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Standard Time :

The standard time may be defined as the amount oftime required to complete a unit of work Under existing working conditions Using a specified method and machinery

By an operator able to work in a propermanner at a standard pace.

Standard time = Normal time + Allowances.

RELAXATION ALLOWANCES (REFA)


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SEVERITY L.M.H.

PHYSICAL STRAIN (Nature of work)Average Force Exerted (Wt)

POSTURE (Sit, walk, stand, climb, add)

SHORT CYCLE (A-7 Centi Min.)

RESTRICTIVE CLOTHINGS (Gloves, boots..)

MENTAL STRAIN (nature of work)

CONCENTRATION (Cross check, driving, pc)

MONOTONY (no interaction)EYE STRAIN (Arc welding, engraving)NOISE (Press, drill)

PHYSICAL/MENTAL STRAIN (Working conditions)


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PHYSICAL/MENTAL STRAIN (Working conditions)

TEMPERATURE (arc-furnace)Low humidity

Med.

High

VENTILATION

FUMES (Paint, steam,)

DUST (ash, weed, cement, ....)

DIRT (duplicator cycle, minors,....)

WET (Steam, laundry....)

CONTINGENCY ALLOWANCES

Unavoidable delays


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POLICY ALLOWANCES

Incentive earnings

Negotiations

SPECIAL ALLOWANCES

Start -up

Closing

M/C Cleaning

Set-up allowancesLearning allowances


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WORK SAMPLING

Work sampling is a method of finding the % occurrence of certain activityby statistical sampling and random observation

Continuous study VS. Random instantaneous

OBSERVATIONAdvantages

Less time /less expensive

Group of men/machine together

More representative of situation (spread over period-same input)

Disadvantages

Accuracy

Bias

Rating

Working


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WorkingTake dictationFilling

TypingRetrieving info.Using phoneMisc.

Non -WorkingNo workNo paper/carbonPersonalMisc.

Application s :Work measurementMethods improvementManpower/Capacity planningEstimating allowance

G Ti i T h i (GTT)


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Group Timing Technique (GTT)

Techniques :Fixed period observationUseful forGang work - load/utilisation

FabricationCivil constructionWork standards/ Production normsAllowanceVerify old standards quickly

% Delay determination


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BUSINESS PROCESS REENGINEERING/

OPTIMIZATION

Load Optimization

Load Balancing/sharing

Resource Optimization


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BUSINESS CHALLANGES Lack of process visibility can manifest in a variety of

business problems for an organization, including:

Little understanding of the impacts of a rapidly-changing business environment to the business

operations. Declining productivity with equal and skill-setalignment.

Poor enforcement of new industry regulations andcompliance requirements, increasing an organizationsrisk of litigation and punitive actions.

Spiraling costs without equivalent level of newbusiness. Increased cycle times to process work and make

critical decisions negatively impacting customerservice and loyalty


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PROCESS OPTIMIZATION CYCLE


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PROCESS OPTIMIZATION CYCLE & SIX

SIGMA

PROCESS ANALYSIS AWARENESS,


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INSIGHT AND INTELLIGENCE

Process Analyzer Configuration

PROCESS ANALYSIS AWARENESS


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INSIGHT AND INTELLIGENCEInformation: System configuration information

Process definitions Process event dataOLAP Data: Work in Progress (Real Time)

Work Item Cycle Time Workflow Cycle Time Queue Load Work Load

Contd


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Breakdown of Mortgages In-Process

Process Analyzer Chart with Real-Time Mortgage Data


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RESOURCE PLANNING

Queue Load the amount of work residing inwork queue.

Incoming the amount of work arriving forprocessing

Outgoing the amount of work leaving thequeue after being completed.

STRATEGIC BUSINESS PLANNING


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Process Analyzer Chart with Workload Components basedon Loan Type



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Process Analyzer Chart with Workload Components basedon Loan Type

Best Practices Auto OEMs (Contd..)Manufacturing


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Practices % of Respondents

Preventive Maintenance 81.8

Product Layout 72.7

Set-up Time Reduction 63.6

Group Technology 45.5

Lean Manufacturing 36.4

82% practice Preventive Maintenance and 73% use Product

Layout, while only 36% follow Lean Manufacturing concept


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Best Practices Auto OEMs (Contd..)

P ti % f R d t

Logistics


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Inventory & Control 90.9

Outsourcing Logistics 81.8

Traffic & Transportation 72.7

Warehousing & Storage 72.7

Tracking and Tracing Systems 54.5Global Logistics 54.5

E- Logistics 36.4

Reverse Logistics 36.4

Distribution Resource planning Systems 18.2

Milk Run Collections 18.2

91% practice Inventory Control and 82% outsource Logistics

while only 18% adopt Milk Run Collections

Best Practices Auto OEMs (Contd..)Information Technology


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ERP Systems 81.8

CAD / CAM 63.6

Web Technology 54.5

Electronic Data Exchange / Fund Transfer 36.4

SCM Software 27.3

Bar- Coding 27.3

CRM Software 18.2

Global Positioning System 18.2

Warehouse Management System 9.1

gy

ERP systems being used by 82% while new technologies

Documents

Prof.lamba Productivity