8/8/2019 engmgt15

1/25

PRODUCTIVITYIMPROVEMENT

Raden M. Manlambus

8/8/2019 engmgt15

2/25

Learning Objectives

To understand the key requirements of a

Productivity Improvement in general.

To understand the Productivity Improvement

Program through Lean Manufacturing Systems.

8/8/2019 engmgt15

3/25

Definition

Productivity Improvementis defined as achieving

more or better economic

returns for the same orfewer inputs, in a

sustainable manner.

8/8/2019 engmgt15

4/25

Simple Equation

Productivity a measurement of output per

unit of the factor used (labor, capital or land)Total Output

Productivity = -------------------

Units of Factor

Technical Efficiency output produced using

the fewest possible inputs

Productive Efficiency output produced at the

lowest possible cost

8/8/2019 engmgt15

5/25

Productivity Improvement results from a

range of initiatives including

improvement of;

Processes and systems

Management systems

Workplace management and culture

Quality

Strategic planning and communication

8/8/2019 engmgt15

6/25

Essentially, productivity is a ratio to measure

how well an organization (or individual,

industry, country) converts input resources(labor, materials, machines etc.) into goods

and services.

This is usually expressed in ratios of inputs

to outputs. That is (input) cost per (output)good / service. It is not on its own a measure

of how efficient the conversion process is.

8/8/2019 engmgt15

7/25

Achieving more output for the same input

Achieving the same output from less input

Achieving much more output for slightly

more input

Getting slightly less output for much less

input

How Productivity is

Improved

8/8/2019 engmgt15

8/25

There are six lines of attack to improve

the productivity ratio of an organization,

namely:

Improve basic process by research and

development (long term)

Improve and provide new plant, equipment, andmachinery (long term)

Simplify product and reduce variety (medium

term)

8/8/2019 engmgt15

9/25

There are six lines of attack to improve

the productivity ratio of an organization,

namely: (cont.)

Improve existing methods and procedures (short

term)

Improve the planning of work and the use ofmanpower (short term)

Increase the overall effectiveness of employees

(short term)

8/8/2019 engmgt15

10/25

Productivity Improvement Topics

Competitive

Manufacturing Just in Time

Business Process

Re-engineering

Value Stream

Mapping

Others

LEAN for

manufacturing LEAN for service and

public sector

organizations

Five Ss

Six Sigma

8/8/2019 engmgt15

11/25

Productivity Improvement

Program Through Lean

Manufacturing

Lean is an approach to achieving manufacturing

excellence based upon the continued elimination

of waste.Waste

is defined as activities that donot add value to the product.

8/8/2019 engmgt15

12/25

Value Added Activities:

Transform raw materials and

information into parts or products.

Non Value Added Activities:

Consume resources that do not

contribute to the physical change of theproduct.

8/8/2019 engmgt15

13/25

What is Lean Manufacturing?Eliminating Waste

Waste in Operations: walking, searching,

standby, rework, changeover

Waste in Layout: travel distances,

backtracking, crowded conditions, redundant

handling

Waste in Flow of Goods overproduction, W.I.P.,

Failure to meet std output per hour person

8/8/2019 engmgt15

14/25

Cont.

Eliminating Waste

Waste in Equipment Line stops, broken

down / antiquated, poor production yields

Other Waste poor housekeeping practices,

damaged materials, improper tools, nothaving the right information.

8/8/2019 engmgt15

15/25

Lead time reduction is achieved

by identifying

and eliminating waste

8/8/2019 engmgt15

16/25

WhyLean Manufacturing?

In Todays Environment the MarketDemands:

Low Costs / Price

High Quality

Greater Variety of Products

Faster Response Times

8/8/2019 engmgt15

17/25

Pressures Requiring Companies

To Become Lean

1. High Cost Labor

Material

Burden - Overhead2. Poor Quality

Internal between depts. & processes

External rework due to vendors

8/8/2019 engmgt15

18/25

Pressures Requiring Companies

To BecomeL

ean3. Late Delivery

Internal Customers on time to satisfy requirements

External Customers- on time to satisfy requirements

8/8/2019 engmgt15

19/25

Lean Manufacturing Checklist

Data Integrity: Inventory accuracy 95%

B.O.M. accuracy 99%

Routing accuracy standards & process

Education: All operators trained in Lean

Individual operators

All functional organizations are represented on

Teams

8/8/2019 engmgt15

20/25

Cont.

Material Flow:

Weekly delivery of 80% of materials

delivered to Point of Use

Parts are produced only at the quantity

required Continuous Flow Manufacturing is

prevalent throughout

8/8/2019 engmgt15

21/25

Cont.

Quality:

All inspection sequences have been

eliminated source inspection practiced

whenever possible

Q.C

. departments are replaced with processaudit functions

8/8/2019 engmgt15

22/25

Planning: Daily Rates and level scheduling established and

met on due date MRP system is used for internal planning,

customer committing, and vendor schedules and

capacity planning

Management participates in the planning andreplanning process and commits to a realistic

capacity level

Customer service 100% as committed and

production equals demand

8/8/2019 engmgt15

23/25

Process Changes:

Single digit setups established

Where feasible work orders are eliminated

or simplified and

priorities controlled by Demand Pull

All functional organizations are representedon Teams

8/8/2019 engmgt15

24/25

Process Changes: Reduction in the number of active vendors and

they are part of the production planning process

Simplify Manufacturing Process to;

Provide management by sight

Identify and surface problems with immediate resolution

Manufacturing is actively involved in the design ofthe product for manufacturability

8/8/2019 engmgt15

25/25

The End Result

A Dynamic workforce that ;

Is Focused on Continuous Improvement

Is Biased ForAction

Puts Creativity Before Capital

Is Totally Involved