Pertemuan 7 (6 April 2014) - Productivity Improvement Concepts
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Transcript of Pertemuan 7 (6 April 2014) - Productivity Improvement Concepts
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PRODUCTIVITY
IMPROVEMENTCONCEPTS
Week 7th
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CAUSES OF PRODUCTIVITY DECLINE IN
COMPANIES (MALI, 1978)
1. Inability to measure, evaluate and manage the productivity
of white-collar employees.
2. Rewards and benefits given without requiring the equivalent
in productivity and accountability.
3. Diffused authority and inefficiency in complex organization,
thereby causing delays and time lags.
4. Organizational expansion that lowers productivity growth.
5. Low motivation among a rising number of affluent workerswith new attitudes.
6. Late deliveries caused by schedules that have been disrupted
by scarce materials.
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CAUSES OF PRODUCTIVITY DECLINE IN
COMPANIES (MALI, 1978)
7. Unresolved human conflicts and difficulties in team work,
resulting in the forms ineffectiveness.
8. Specialization in work processes resulting in monotony and
boredom.
9. Rapid technological changes and high costs, resulting in a
decline in new opportunities and innovations.
10. Increased demand of leisure time causing disruption of time
commitments.
11. Practitioners inability to keep pace with latest information
and knowledge.
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The absence of productivity
measurement of nonproduction
workers stands as the first causefor the decline of productivities in
companies.
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PRODUCTIVITYIMPROVEMENT
APPROACHES
2. SUTERMEISTERS MODEL
Sutermeistersapproach to productivity
improvement is characterized by identifying and
explaining the interrelationship factors affecting
worker productivity.
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PRODUCTIVITYIMPROVEMENT
APPROACHES
3. HERSHAUER AND RUCHS MODEL
Hershauer and Ruch present aservosystem
model.
The model is a valuable step in understanding the
mechanics of productivity improvement.
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PRODUCTIVITYIMPROVEMENT
APPROACHES
4. CRANDALL AND WOOTONS STRATEGIES
They present a model that integrates the role ofproductivity improvement with the growth of theorganization and the role of the executive as a productivitydecision maker
The identify four possible stages of organizational growth:
1. Entrepreneurial growth
2. Bureaucratic growth
3. Diversification and systemization growth
4. Mega organizational growth
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Entrepreneurial growth
It reflects the initial development of an organization and involves
the exploration of its environment to introduce new products or
services.
Bureaucratic growth
It involves organization and codification of administrative and
work processes.
Diversification and systemization growthIt is basically a segmentation of the enterprise into multiple
product lines, services and activities, as well as the establishment
of the complex interrelationships necessary to support a
diversified organization, thus involves both internal and external
growth.
Mega organizational growth
It represents very complex environments in turbulent change
conditions.
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PRODUCTIVITYIMPROVEMENT
APPROACHES
5. STEWARTS STRATEGY
Stewart proposes a productivity improvement
strategy for organizations based on a systems
perspective, which require that one view an
organization as a complex network of
interdependent sub units, all aimed at producing ablend of activities that enhances the overall
performance of the organization in the long run.
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PRODUCTIVITYIMPROVEMENT
APPROACHES5. AGGARWALS APPROACH
Aggarwal proposed a step by step procedure to productivity
improvement in companies:
a) Identify and prioritize the objectives of the company or
organization
b) Define criteria for outputs within organizational limitationsc) Prepare action plans
d) Eliminate know barriers to productivity
e) Develop productivity measuring method and calculate the base-
period productivity
f) Execute action plans and start ongoing measurement andreporting
g) Motivate workers and supervisors to achieve higher productivity
h) Maintain the momentum of productivity efforts
i) Keep auditing the organizational climate
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A NEW PERSPECTIVE ON
PRODUCTIVITY IMPROVEMENT
(BASIC PRODUCTIVITY IMPROVEMENT TECHNIQUES)
1. Technology-based techniques
Computer-Aided Design (CAD)
Computer-Aided Manufacturing (CAM)
Integrated CAM
Robotics
Group Technology, etc.
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A NEW PERSPECTIVE ON
PRODUCTIVITY IMPROVEMENT
(BASIC PRODUCTIVITY IMPROVEMENT TECHNIQUES)
2. Employee-based techniques
Financial incentives
Employee promotions
Job Enrichment
Job Enlargement Job Rotation
Worker Participation
Skill Enhancement
Learning Curve
Communication Training
Education
Etc.
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A NEW PERSPECTIVE ON
PRODUCTIVITY IMPROVEMENT
(BASIC PRODUCTIVITY IMPROVEMENT TECHNIQUES)
3. Product-based techniques
Value engineering
Product diversification
Product simplification
Research and development
Product standardization
Product reliability improvement
Advertising and promotion
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A NEW PERSPECTIVE ON
PRODUCTIVITY IMPROVEMENT
(BASIC PRODUCTIVITY IMPROVEMENT TECHNIQUES)
4. Task-based techniques
Methods engineering
Work measurement
Job design
Job evaluation
Job safety design
Ergonomics
Production scheduling
Computer-aided data processing
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A NEW PERSPECTIVE ON
PRODUCTIVITY IMPROVEMENT
(BASIC PRODUCTIVITY IMPROVEMENT TECHNIQUES)
5. Material-based techniques
Inventory control
Materials Requirement Planning (MRP)
Materials management
Quality control
Material handling systems improvement
Material reuse and recycling
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ANALYTICAL PRODUCTIVITY IMPROVEMENT
MODEL (APIM)
A six-step procedure is proposed for improving the totalproductivity of an organization based on an analyticalmodel:
1. Data collection
2. Computation of productivity changes and data filecompilation
3. Determination of productivity improvement coefficients
4. Evaluation of the productivity improvement coefficients
and technique usage5. Final selection of the productivity improvement
techniques
6. Implementation of the selected techniques.
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PRINCIPLES OF PRODUCTIVITY
IMPROVEMENT (1)
1. Microprocessor Principle
Whenever and wherever possible, design products and processes
with microprocessor control.
2. Global-Market Principle
Design and manufacture products for global market.
3. Learning Curve Principle
Wherever possible, plan productivity levels and product costs on a
learning curve. One of the most ignored phenomena in operations of
company is the existence of a learning curve.
4. Secrecy Principle
Productivity improvement strategies that are novel when compared
to the competitors must be kept secret.
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PRINCIPLES OF PRODUCTIVITY
IMPROVEMENT (2)
5. Product-Mix Principle
Develop a product mix that consistently shows the largest gains in
total productivity and market share.
6. Emulation Principle
Take the best of at least three competitors technologies in product
design, development and production.
7. Productivity Gain-Sharing Principle
Always, share the gains in productivity improvement with everyone
directly or indirectly responsible for it, particularly employees andcustomers.
8. Leading Competitor Principle
Be the leading competitor for as many products/services as possible.
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PRINCIPLES OF PRODUCTIVITY
IMPROVEMENT (3)
9. Harmony Principle
Seek harmony in human relations at all levels of management fromthe top most executive down to the production/operations levelemployee.
10. International Outlook PrincipleKeep an international perspective in management activities related toplanning, research and development, marketing, operations,production, and technology transfer.
11. Cooperative Research Principle
Work closely with universities and generic research establishments tobring in an ideas for productivity improvement.
12. Productivity Process Principle
Productivity improvement must be an ongoing, day-to-day processand not a one-time program or project.