Pertemuan 7 (6 April 2014) - Productivity Improvement Concepts

8/12/2019 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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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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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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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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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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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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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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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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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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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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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.

Documents

Pertemuan 7 (6 April 2014) - Productivity Improvement Concepts