Saturday, December 31, 2016

Industrial Engineering - Productivity Science, Engineering and Management in Engineering Organizations

Industrial engineer is Productivity Scientist, Productivity Engineer and Productivity Manager combined into one.

Productivity Science

Exemplar - Science of handling heavy loads - F.W. Taylor

Productivity Engineering

Exemplar -  The art of metal cutting to increase output from machine tools with economical cost.

Human Effort Engineering for Productivity - Time study to understand best practice for various elements of task and synthesizing the most productivity method.


Poka Yoke

Productivity Management

Incentive system to motivate the operator to put in first class effort based on first class skill.

Suggestion schemes and sharing of saving.

Work simplification.

Instruction card - A directing mechanism to ensure productivity.

Kanban - Another directing mechanism to initiate component manufacture.

Wednesday, December 14, 2016

Robot Motion Economy Principles

1. Minimize the number of grippers needs and consider adding a simple feature for easier more secure gripping

2. Simpler Robots - Minimize the complexity of robots.  Reduce number of arms and joints.

Thursday, December 1, 2016

Methods improvement - The Current Role of the Foreman - Supervisor

Methods improvement and the foreman, by J. W. Roberts and Clem Zinck.

Main Author: Roberts, John William, 1901-
Published: New London, Conn., National Foremen's Institute [1951]
Subjects: Supervisors, Industrial.
Physical Description: 174 p. illus. 21 cm.

Good and detailed content on work simplification is there in this book

The Training Within Industry Report, 1940-1945: A Record of the Development of Management Techniques for Improvement of Supervision, Their Use and the Results
War Manpower Commission, Bureau of Training, Training within Industry Service, 1945 - Employees - 330 pages

Training Within Industry Individual Manuals

Scans of the original manuals. Each manual has color covers, front and back. All manuals setup for duplex printing. Single sided printouts will have some blank pages. See Printing Notes for details.

Bulletin Series --- Original Text, 5.9MB
JI: Job Instruction Manual --- Original Text, 2.6MB
JM: Job Methods Manual --- Original Text, 4.0MB
JR: Job Relations Manual --- Original Text, 3.7MB
UJR: Union Job Relations Manual --- Original Text, 4.1MB
PD: Program Development Manual --- Original Text, 4.0MB
JS: Job Safety Manual --- Original Text (from Canadian Department of Labor, Found at National Archives), 2.1MB
Individual Manual Printing Notes

Work Simplification - Alan Mogensen


Alan Mogensen

3. To creat a sense of "belonging," and of "participating." and of "accomplishing"  in each and every employee is a vital responsibility of managemet. Work simplification stresses this human factor. Here, of course, the foreman plays a vital part.

5. Work simplification rests of the principle that any work that does not add value to the product, does not give or receive essential information, does not plan or calculate is essentially WASTE.

7. The major specific wastes in a process are TRANSPORTION, DELAY or STORAGE, and INSPECTION. The major waste in a man-machine combination is IDLE TIME by both the operator and the machine.   The major  wastes in the activity of a worker in  a process, a man-machine combination or in hand operation  are TRANSPORTION, DELAY , and FAILURE TO REDUCE THE ELAPSED TIME of activity by the use of KNOWN FASTER DEVICES.

11. Ingenuity has great possibilities. Often the results of a new twist are startling. Work-simplification techniques give full scope to ingenuity and see to its proper application.

Thursday, November 24, 2016

Total Cost Industrial Engineering - An Illustration

Total cost industrial engineering is determining  cost reduction target at the total cost level of the organization and achieving the target by using industrial engineering methods and techniques in various departments of the organization. Total productivity management is the name under which it is promoted.

The illustration is based on  Top-down Production Management: A Recent Trend in the Japanese Productivity-enhancement Movement by W. Mark Fruin and Masao Nakamura, published in



Step 1. Corporate goal setting for cost reduction.  Set  company-wide numerical goals and targets.

Step 2. Top-down explosion process. Explode the corporate-level goals and targets systematically into actions by specific departments (or by specific product lines) and select numerical goals and targets for individual departments (or specific product lines). Repeat Step 2 until goals and targets are selected or assigned to all layers of relevant organizational units and individuals with the responsibility for cost reduction (industrial engineers in engineering departments).

Step 3. Implementation and assessment.  Compare the corporate performance and departmental performances  with the originally set goals. Take control actions in the current year. Incorporate changes in the planning system for the next year.

The strategic planning decided that it is necessary to achieve a 15% reduction in the unit estimated production cost taking into consideration the improvements in the product planned in order to give a 10% reduction in the existing price. This means that the current production cost (200000 yen) must be reduced by  35000 yen. The composition of the unit production cost is: labor 30% (60000 yen), raw materi als 60% (120000)  and overhead 10% (20000).

After initial analysis by cost reduction - industrial engineering top level team,  it was decided that the cost-reduction target, 35000 yen, will be allocated between labor and raw materials as labor 14000 yen, and raw materials 21000 yen.

Labor Cost Reduction - Further Assignment

The labor cost reduction target is to be assigned to five workshops:  molding, machine, welding, assembly and inspection workshops.  Discussions of the top level CR-IE team with the shop level CR-IE team lead to the following cost reduction targets at the shop level: molding 840 yen,  machinery 4194 yen, molding 840 yen, welding 2285 yen, assembly 6000 yen, and inspection workshop 660 yen.

Assembly level cost reduction target further break up. 

 The assembly workshop has eight assembly lines A-H.   Lines B, C and E employ large labor hours, consist of similar job tasks and an improvement in one can be implemented on the lines.
(f) The numerical target for cost reduction for the assembly workshop is 6000 yen. The cost target was converted into 1676 hours reduction target. Lines B, C and E are operational 95% of the time and hence our labor input reduction effort has to be from reduction of assembly time. The opportunity to get savings from downtime is limited.

Assembly Line Level Effort

22 jobs are done on these assembly line with six stations. Each station is given 0.15 minute. The  total utilized labor time for all the stations is only 0.53 minutes.  Hence effort was made to reduce the station time or cycle time to 0.09 minutes. The output from the lines have gone up by 40% due to this productivity improvement initiative and the assembly workshop met its cost reduction target.

The simplified description shows how a corporate level cost reduction target is converted into shop level and assembly line level or work centre level cost reduction targets. The top level CR-IE team, department level CR-IE team and shop level CR-IE team interact with fix shop level cost reduction targets. The industrial engineer, in engineering departments joins with engineering managers, supervisors and operators of the shop to engage in productivity improvement project. They get the needed help from higher level CR-IE team members to complete the project.
The implementation of a top-down TPM program requires substantial inputs of a bottom-up persons of the shop. Without cooperation from the shopfloor no meaningful numerical targets could be derived and hence an effective implementation of any target would not be possible.
The main characteristics of TPM is that it deals with corporatewide goals. Another is that it deals with specific numerical targets for cost reduction.

Bottom-up approaches to productivity improvement are important for continuous improvement but may only provide sub-optimal solutions from the firm’s perspective when a corporate-wide optimal solution is required. TPM has been found to be effective for overall optimization and hence for improving firms’ overall profitability in a planned way over the typical sales and profit planning periods.

Related Article

Productivity Management

Friday, November 18, 2016

Principles of Machine Utilization Economy

19 November 2016

Industrial engineers have to improve the machine utilization economy. To do that we need principles of machine utilization economy, like principles of motion economy.

What principles can be proposed?

1. If it is a machine tool, we have to investigate cutting tools, coolants, cutting speeds, feeds, depth of cut and jig and fixtures to improve the utilization and productivity. Taylor himself did all these evaluations and suggested many improvements, which are still valid today.

2. For all machines, finding the load at which maximum efficiency is obtained is done. The load planning has to take into account the maximum efficiency load.

3. Six sigma provides a way to optimize the working of any machine. The factors that affect the working of the machine are to be identified, and the levels at which they can be operated are to be found. Then the combination of factors and levels at which the best output will come will be obtained and machine can be run at that combination or setting.

4. Calculate economic batches for various components to be made on the batch and use those batch quantities. JIT as an idea is welcome, but you can use it only when you implement SMED and drive down the setup time.

5. Look for opportunities to implement Pokayoke features on the machine so that defects are reduced to very low levels (zero defects).

6. Use the developments in maintenance management to have the most efficient and productive maintenance system.

Total Productivity Equipment Usage Management

Six major categories of inefficiencies and losses related to equipment - machines
affect the overall performance of the equipment namely:

1. Equipment failures/breakdown losses are the time losses and quantity losses caused by defective
2. Set-up and adjustment losses are defined as time losses resulting from downtime and defective
products that occur when production of one item ends and the equipment is adjusted to meet the
requirements of another item.
3. Idling and minor stop losses occur when the production is interrupted by a temporary malfunction
or when a machine is idling.
4. Reduced speed losses refer to the difference between equipment design speed and actual operating speed.
5. Reduced yield losses occur during the early stages of production from machine start up to stabilization.
6. Quality defects and reworks are losses in quality caused by malfunctioning of production equipment.

Selection Principles on Manufacturing System for Part Family
Li Tang1,  Derek Yip-Hoi2, , Wencai Wang1, Yoram Koren1
1  NSF Engineering Research Center for RMS, University of Michigan, Ann Arbor, U.S.A.
2  Mechanical Engineering Dept., University of British Columbia, Vancouver, Canada

Thursday, November 17, 2016

Hundred Years of Industrial Engineering and Improvement of Productivity - Link to Article

The principles of scientific management and the advocacy for staff specialists to help managers implement scientific management gave birth to the discipline of ‘Industrial Engineering'. Charles Buxton Going authored the first textbook on industrial engineering.

Principles of Scientific Management:

The operators have to be selected scientifically and then trained in standard methods. 

There has to be cooperation between men and managers so as to insure all of the work being done is in accordance with the principles of the science which has been developed. 

There has to be an almost equal division of the work and the responsibility between the management and the workmen. 

The management takes over all work for which they are better fitted than the workmen, while in the past almost all of the work and the greater part of the responsibility of operations were thrown upon the men.

Article by Narayana Rao K.V.S.S. (Author of this blog)

Principles of Industrial Engineering

To be added.

Updated  20 November 2016, 3 Feb 2012

Review of Total Productivity Management

Review of Total Productivity Management
Yoshiro Saito, JMA Consultants Inc., Tokyo, Japan
Masanaka Yokota, JMA Consultants Inc., Tokyo, Japan
Chapter in Maynard's Handbook of Industrial Engineering, 5th Edition, 2001
Total productivity management (TP management) provides a system for coordinating all the various improvement activities occurring in a company so that they contribute to top management’s goals for the entire company. Starting with a corporate vision and broad goals, these activities are developed into supporting objectives, or targets, throughout the organization. The targets are specifically and quantitatively defined.   The chapter describes how to introduce, develop, and expand a TP management program.

TP management is, in a sense, a top-down program because it always starts by identifying the goals of top management. The strategy and business plan of the company are the basis for developing the productivity policy, that specifies the productivity goals.

Saito and Yokota advocated that TPm employ the following concepts:

● Break away from conventional internally oriented, comparative productivity campaigns that seek incremental improvements, and instead focus on achieving ambitious new targets.
● Change from kaizen activities, which build up incremental improvements, to an approach
based on an image of the ideal—seek extreme results.
● Pursue the concept of the ideal total system.
● Apply management technology in a systematic and theoretically correct manner.

TP management also requires that each company develop and establish its own original management system. The concepts underlying TP management offer a new way of thinking about productivity.
What is evident is that TP management derives its targets from the overall plan and is working out in a top down approach to achieve them. The bottom up spontaneous improvement activities are to be encouraged but have to dovetailed into supporting the TP targets. TP management is a proven technique according to Saito and Yokota and they claim that their organization had 10 years of experience in providing management guidance to organizations in implementing TP management.
The focus of TP management is extended from company profits to customer satisfaction, employee satisfaction and even social satisfaction.

The improvements are classified into two external deliverables and internal structural improvements.
Productivity management is a primary focus area for IE departments and they have to adopt this TP management approach to serve their organization in a strategic manner.

The TP management program of a company is described by the author. The TP program seeks to achieve the following goals:

1. Clarify the objectives that the company (or business unit) as a whole should pursue, focus
and work simultaneously toward accomplishment of the objectives.

2. Create an organization that can take the general, company-wide objectives and systematically
develop them into specific targets, based on confirmation of which activities are most
important for accomplishing corporate goals (IE department needs to teak for this purpose).

3. Create and standardize a three-level process, in which (1) general objectives are developed
into (2) individual targets, which are then translated into (3) plans and activities. This
process ensures that each plan and activity advances individual objectives and targets that
are in accordance with management goals (These department wise targets assigned to operating departments  as well as IEs working for those departments).

4. Take advantage of the strengths and capabilities of all employees in the organization and
challenge them to contribute and  grow. Then, make it clear to them how their actions are contributing to the targets and objectives.This will increase their eagerness to participate in improvement activities.

5. Create a strategic management system that can adapt to changes in the business environment
and at the same time obtain dramatic improvements in business results based on management’s design.

Saito and Yokota have not specifically identified the role of IE department in this activity. As this is a part of IE Handbook, the editors must have asked the authors to customize it for application by IE departments.

A brochure by JMA Consultants on Total Productivity Management
Strategic Administration by Total Productivity Improvement
by Michitoshi Oishi Ph. D., and Miriam Christi Midori Oishi
Top Down Production Management: A Recent Trend in the Japanese Productivity-enhancement Movement
W. Mark Fruin and Masao Nakamua
Total Improvement Management - Brochure
The 2001 Total Productivity (TP) Management Conference was held by JMA on June 18-19 in Tokyo.

Total Productivity Management Prize (TP Prize), the TP Prize is one of the JMA commendations and was established in 1982, commemorating the 40th anniversary of JMA. It's objective is to publicly recognize companies and organizations that achieved excellence in productivity management. 

 In 2001, TP Prizes were awarded to Aizu Plant of Olympus Opto-Electronics Co. Ltd., Internet Systems Platform Division of Hitachi, Ltd; and Display Device Company & DDC Division of LG Electronics Inc. 

 Using TP management, Olympus Opto-Electronics quickly responded to a changing business environment to consistently achieve its stated business goals in endoscope production. Hitachi Ltd. employed TP management to materialize management reform in terms of speed to market in the increasingly competitive personal computer industry. LG Electronics Inc. likewise applied TP management to realize economic value added (EVA) cash flow management.
For year 2003, TP Prize was awarded to Topcon Corp., which also received a special award for TP Management Promotion, Hitachi Global Storage Technologies Philippines Corp., and The Kansai Coke and Chemicals Co., Ltd., Kakogawa Plant. 
Total productivity management: a systemic and quantitative approach to Compete in Quality, Price and Times By David J. Sumanth, St. Lucie Press, 1998
Management Consultants, Inc., Miami
___________________________________________________________________ 2utb2lsm2k7a/ 2298

Productivity Management Articles to be updated

Updated     20 Nov 2016,  12 August 2016,  8 March 2012

Total Productivity Management - A Different Perspective - Suito Kiyoshi

The purpose of "Total Productivity Management" is to improve the competitiveness of products and services in price/cost and customer responsiveness, thereby increasing the profitability, market share, and return on investment in human, material, capital, and technology resources.

1. Mission Statement Development

2. Productivity Analysis

• Total Productivity and Break-Even   Point of Total Productivity
• Human Productivity
• Materials Productivity
• Fixed Capital Productivity
• Working Capital Productivity
• Energy Productivity
• Other Expense Productivity
An analysis will be made of the impact of these productivities on profits.

3. Management Goals Development

4. Productivity Goal Development

5. Fishbone Analysis and Action Plans Development
Using the Fishbone Analysis, action plans will be developed for each of the management goals.

5. PQT Training
This training entails an 8-step approach for problem-solving to improve productivity, quality, and customer responsiveness. It also teaches skills in supervision, planning, organizing, motivating, delegating, controlling, and communicating.

6. Assessment of Productivity Goal Achievement
To assess the progress toward the achievement of the productivity goals. Personnel from accounting and management information systems will be taught how to use it.

7. TPG
To provide consistent motivation to achieve the corporate mission, the "Total Productivity Gainsharing" formula will be applied. The management will be guided to consider different options.

Suito, Kiyoshi. (1998). Total productivity management.  Work Study, 47(4), 117-127.

Paper containing full example of the above model
Resource Use, Waste, and Total Productivity Management in Saudi Arabia Hotel Industry
Rami H. Alamoudi
Department of Industrial Engineering
King Abdulaziz University, Jeddah, Saudi Arabia
International Journal of Basic & Applied Sciences IJBAS Vol: 9 No: 10, Pp. 43-54

Determinants of Productivity - Syverson - 2011

Paper: What Determines Productivity?
Chad Syverson
Journal of Economic Literature 2011, 49:2, 326–365
Can be accessed from Syverson's personal website

Economists have shown that large and persistent differences in productivity levels across businesses are ubiquitous. This finding has shaped research agendas in a number of fields, including (but not limited to) macroeconomics, industrial organization, labor, and trade. This paper surveys and evaluates recent empirical work addressing the question of why businesses differ in their measured productivity levels. The causes are manifold, and differ depending on the particular setting. They include elements sourced in production ractices—and therefore over which producers have some direct control, at least in theory—as well as from producers’ external operating environments. After evaluating the current state of knowledge, the papers  lays out the major questions that research in the area should address going forward.

Research questions for further research

1 What Is the Importance of Demand?
2 What Is the Role of (or Hope for) Government Policies That Encourage Productivity Growth?
3 Which Productivity Drivers Matter Most?
4 What Factors Determine Whether Selection or Within-Producer Growth Is More Important in a Market/Sector/
5 What Is the Role of Misallocation as a Source of Variation in Emerging Economies?
6 What Is the Importance of Higher Variance in Productivity Outcomes?
7 Can We Predict Innovation Based on Market Conditions?
8 The Nature of Intangible Capital
9 Management Versus Managers
10 A Plea for Data

This research is further  continued by other scholars

Updated  20 November 2016,  6 August 2013

Productivity Management - An Activity of Industrial Engineers - List of Articles

Productivity Management is an important component of industrial engineering

Industrial engineering department has the responsibility to manage productivity in the organization. It may undertake this responsibility as a staff department like accounting department. IE department measures productivity, identifies the reasons for low productivity and high costs, determines the processes and operations, products to be studied using IE methods to improve productivity of them and submits the recommendations to line managers. On the approval of line managers, IE participates in installation projects and training projects and then measures the new productivity. A well functioning IE department is responsible for continuous improvement in productivity. Competitors come into the market with more productivity methods and products and every existing company has to pay attention to productivity to remain in the market and protect its market share in the presence of new competitors. IEs help companies to maintain their competitive position.

IEs have to plan productivity improvement, organize for productivity improvement, acquire resources for undertaking productivity improvement projects, execute productivity improvement projects and control productivity improvement. They have to use all functions of management (process of management) to manage the productivity of a concern as staff assistants to managers at various levels.

Review of Total Productivity Management

Management and Industrial Engineering

Driving Change One Project at a Time

Total Industrial Engineering and Work Simplification

Role of Top Management in Implementing Scientific Management - F.W. Taylor

Productivity Measurement

Accounting Analysis of Productivity Projects and Programmes - Bibliography

Total Cost Industrial Engineering - Industrial Engineering of Enterprise Cost

Productivity Management - Books

Productivity Planning

Productivity Accounting - 2015 - Emili Grifell-Tatjé, C. A. Knox Lovell - Book Information

Cross-Functional Productivity Improvement - Ronald Blank - 2012 - Book Information

Strategic Total Productivity Optimization

Total Productivity Management - A Different Perspective

Determinants of Productivity - Syverson - 2011

Train Operators in High Productivity One by One and Then in Small Batches - F.W. Taylor

Learning Curve - Experience Curve - Bibliography

Total Cost Industrial Engineering - Bibliography

Total Cost Management and Total Cost Industrial Engineering

Suggestions Schemes that work - AME article

Work Simplification by Alan Mogensen

Updated  20 Nov 2016, 12 August 2016, 23 July 2016

Productivity Measurement

Productivity management is one of the important functions of industrial engineering departments in companies. Productivity measurement facilitates planning and controlling productivity levels in the companies.

I.  Kendrick – Creamer Model :[1]

Kendrick and Creamer (1965) introduced productivity indexes at the company level in their book, "Measuring Company Productivity". They proposed two types of  indices: total productivity and partial productivity.
Total productivity index for given period = (Measured period output in base period price) / (Measured period input in base period price)
Total factor productivity index = net output/total factor input
Net output – intermediate goods and services
Total factor input = manhour input and total capital
Partial productivity  of  labour, capital or material productivity index can be calculated as: Partial productivity = (Output in base period price) / (Any one Input in base period price)

II. Craig –Harris Model :

Craig and Harris (1972, 1973) [2,3] defined total productivity measure: 

  PT=   OT / ( L+C+R+Q )
PT  = total productivity,
OT= total out put.
L = labor input factor,
C = capital input factor,
R = raw material input factor and
Q = other miscellaneous goods and services input factor
The output is defined as the summation of all units produced times their selling price, plus dividends from securities and interest from bonds and other such sources-all adjusted to base-period values.

III. Hines (1976)[4] proposed some measurement improvements to various individual items in productivity measurement models.

IV. American Productivity Centre Model :[5]

American Productivity Center has measure that expresses profitability as a product of   productivity and price factor. The way it is done is:  
Profitability   = Sales / Cost
                            = (Output quantity) *(Price) / (input quantity)* (unit cost)
                            = (Productivity)* (Price recovery factor)

Where; productivity = output quantity / input quantity

V. Sumanth’s Total Productivity Model (1979) [6]

Total productivity (TPM) = total tangible output/total tangible input
Total tangible output = (value of finished units produced + value of partial units produced
                             + dividends from securities + interest from bonds+ other income)
Total tangible input = value of (human + material + capital + energy + other expenses) inputs used.
Sumanth provided a structure for finding productivity at product level and summing product level productivities to total firm level productivity. The model also has the structure for finding partial productivities at the product level and aggregating them to product level productivities.

Is productivity measurement in practice today?

The answer is yes.
In FY 2006 the study group on the Creation of a Productivity Database on Japanese, Chinese, and South Korean Companies at the Japan Center for Economic Research (JCER) created the East Asian Listed Companies Database 2007 ("EALC 2007") along with the Hitotsubashi University Center for Economic Institutions (CEI), the CENU Center for China and Asian Studies (CCAS; Professor Tomohiko Inui as project representative), and the Center for Corporate Competitiveness of Seoul National University (Professor Keun Lee as project representative). EALC 2007 in principle targets all listed firms in Japan, China, and South Korea (not including the financial sector). It includes data necessary to measure total factor productivity at the company level and the periods covered are 1985 through 2004 for Japanese firms, 1985 through 2005 for South Korean firms, and 1999 through 2004 for Chinese firms.

Based on direct comparison of the total factor productivity of listed firms in Japan, China, and South Korea, the researchers analyzed the following questions. 1) In which industries in particular are South Korean and Chinese companies catching up to Japanese ones? 2) Has productivity growth in Japanese firms stagnated since the 1990s? 3) If it has stagnated, in which industries is this most remarkable? 4) What are the characteristics of disparities in productivity among companies in the same industries in each country? The reports (in Japanese) cover the results of the research on these questions[6].

The Japan Center for Economic Research, the Hitotsubashi University Center for Economic Institutions, the CENU Center for China and Asian Studies, and the Center for Corporate Competitiveness of Seoul National University plan to continue joint research in FY 2007, including revising and updating the EALC database, expanding the countries targeted, and analyzing results.


1. Kendrick, J.W., and D. Creamer, “Measuring Company Productivity: Handbook with Case Studies.” Studies in Business Economics, No. 89, National Industrial Conference Board, New York, 1965.
2. Craig, C.E., and C.R. Harris, “Productivity Concepts and Measurement- A Management Viewpoint,”Unpublished Master’s thesis, M.I.T., Cambridge, Massachusetts, 1972.
3. Craig, C.E., and C.R. Harris,“Total Productivity measurement at the firm level,” Sloan Management Review, Vol 14, No. 3, 1973, pp. 13-29.
4.  Ruch, W.A., “Your Key to Planning Profits”, The Productivity Brief 6, Oct.1981, by American Productivity Cente,r Houston. TX-77024.
5. Sumanth, David J., Productivity Engineering and Management, McGraw Hill Book Company, 1984.

Additional Bibliography

International Applications of Productivity and Efficiency Analysis: A Special Issue of the Journal of Productivity Analysis
Thomas R. Gulledge, C.A. Knox Lovell
Springer Science & Business Media, Nov 11, 2013 - 200 pages

International Applications of Productivity and Efficiency Analysis features a complete range of techniques utilized in frontier analysis, including extensions of existing techniques and the development of new techniques. Another feature is that most of the contributions use panel data in a variety of approaches. Finally, the range of empirical applications is at least as great as the range of techniques, and many of the applications are of considerable policy relevance.

Managerial Issues in Productivity Analysis
Ali Dogramaci, Nabil R. Adam
Springer Science & Business Media, Dec 6, 2012 - 246 pages

A. Dogramaci and N.R. Adam Productivity of a firm is influenced both by economic forces which act at the macro level and impose themselves on the individual firm as well as internal factors that result from decisions and processes which take place within the boundaries of the firm. Efforts towards increasing the produc tivity level of firms need to be based on a sound understanding of how the above processes take place. Our objective in this volume is to present some of the recent research work in this field. The volume consists of three parts. In part I, two macro issues are addressed (taxation and inflation) and their relation to produc tivity is analyzed. The second part of the volume focuses on methods for productivity analysis within the firm. Finally, the third part of the book deals with two additional productivity analysis techniques and their applications to public utilities. The objective of the volume is not to present a unified point of view, but rather to cover a sample of different methodologies and perspectives through original, scholarly papers.
(Chapter 8 is an interesting paper with propositions on technical efficiency of technology in electric utility companies)

Construction Management and Economics
Volume 24, Issue 10, 2006
Construction equipment productivity estimation using artificial neural network model
Seung C. Oka & Sunil K. Sinhaa*

pages 1029-1044

An Introduction to Efficiency and Productivity Analysis
Tim Coelli
Springer Science & Business Media, Jul 22, 2005 - 349 pages
The second edition of this book has been written for the same audience as the first edition. It is designed to be a "first port of call" for people wishing to study efficiency and productivity analysis. The book provides an accessible introduction to the four principal methods involved: econometric estimation of average response models; index numbers; data envelopment analysis (DEA); and stochastic firontier analysis (SFA). For each method, we provide a detailed introduction to the basic concepts, give some simple numerical examples, discuss some of the more important extensions to the basic methods, and provide references for further reading. In addition, we provide a number of detailed empirical applications using real-world data. The book can be used as a textbook or as a reference text. As a textbook, it probably contains too much material to cover in a single semester, so most instructors will want to design a course around a subset of chapters. For example, Chapter 2 is devoted to a review of production economics and could probably be skipped in a course for graduate economics majors. However, it should prove useful to undergraduate students and those doing a major in another field, such as business management or health studies.

Updated  20 Nov 2016,   12 June 2016,  19 June 2015
First published on 10 Feb 2012


Leadership and Productivity

How Leaders Can Improve Productivity and Profits Simultaneously

Leadership's Impact on Productivity and Engagement
November 2013 -  Gordon Tredgold

April 2010

Leadership and its Impact on Productivity
Singapore Productivity Association

Prime Minister Lee Hsien Loong, in his keynote address at SNEF 30th Anniversary CEO and Employers Summit in July 2010, highlighted that “a huge part of the responsibility for improving productivity falls on employers and business leaders”. He emphasised the point advocated by F.W. Taylor that leadership has to take interest, study existing processes and develop new processes to upgrade productivity for businesses.

While management is “getting things done through others”, leadership involves “getting others to want to do things”.

Leadership at Various Levels in Organisations


The first step is leading one’s self. Leaders who can lead themselves meaning who can convince themselves about the utility of a particular action for himself and the organisation,  and possess  the core leadership skills  to lead others would enjoy a high degree of success in leading others in the long run. This calls for an understanding and awareness of strengths and weaknesses, clarity of personal vision, and ability to be creative and curious, understanding others that come in contact with him or have a stake in his activities and a sense of one’s personal brand of leadership.


Middle managers play a critical role in communicating and explaining the organizations programmes to members their teams. It is critical for middle managers to know how to influence others through communication, relationship building and management of tasks entrusted to them.


In the case of senior leaders, who are leading fulld departments,  the  perspective must be
to engage and generate passion in others. Creating a vision for success and aligning all members of the team to that vision is required. It requires an understanding of team leadership and organization dynamics. The senior leaders have to create an environment which maximises the abilities of all team members. Leading for success in the team environment requires a great deal of grace, patience, focus and finesse.

Business Unit
Leaders who operate at this level are responsible and therefore measured by tangible results, which they must produce at the business unit level. It demands leaders who could align efforts of various function with the unit-level business objectives. Leaders at this level must be able to measure performance, improve business processes, create an environment which fosters accountability. They also have to empower functional heads, so that they are proactive, focussed and successful.


Leaders operating at the organisation perspective are usually concerned with the strategic direction, enhancing value to the customer, increasing competitive advantage and developing competencies and capabilities for future,   They require the skills and capacity to position themselves and their teams to maximise value today and in the future. These leaders have to monitor the changing marketplace and are react in time to ensure  the long-term viability and effectiveness of the organisation and, business units.

Leaders Drive Productivity:  Are you building a High Performance Environment?
Successfactors article

Updated 20 Nov 2016,  13 August 2016

Wednesday, November 9, 2016

Total Industrial Engineering - Revison Notes

"Industrial Engineering is human effort engineering and system efficiency engineering." (KVSSNRao)
This statement appeared in IIE magazine "Industrial Engineer" in March 2010 issue.

Total industrial engineering is a  system of methods where the performance of labor is maximized by reducing Muri (overburdening/unnatural operation), Mura (irregular operation) and Muda (non-value added operation), and then separating labor from machinery through the use of sensor techniques. (Yamashina, H)

How to Eliminate Muri or Overburdening

Mitigating Mura or unevenness

Muda just means unnecessary
More musing on Muda

12 November  2016

I once again got an opportunity to look into the topic of total industrial engineering (TIE). I have to moderate a panel discussion on 17 November 2016 on the topic Evolving Concepts of IE. Two of the speakers are from an organization associated with total industrial engineering.

TIE is part of WCM being promoted by Yamashina.

World Class Manufacturing model in production management
K. Pałucha*
Management and Administration Institute, Organization and Management Faculty,
Silesian University of Technology, ul. Roosevelta 26-28, 41-800 Zabrze, Poland
Archives of Material Science and Engineering
December 2012

Improving Operations Performance with World Class Manufacturing Technique: A Case in Automotive Industry
Book Chapter, 2015
Fabio De Felice, Antonella Petrillo and Stanislao Monfreda

The following subjects or techniques form part of industrial engineering tool kit.

Human Effort Engineering

1. Principles of Motion Economy and Motion Study.
    Therbligs, SIMO chart, Chronocycle graph
2. Work Measurement
    Stop watch time study, worksampling, PMTS - MTM, MOST
3. Ergonomics

4. Safe Work Practice Design
    Personal protective devices

5. Wage Incentives and Job Evaluation

System Efficiency Engineering

1. Method Study and Methods Efficiency Design
    Process analysis, operation analysis, work station design
2. Value Engineering

3. Statistics Based Techniques: Statistical Quality Control (SQC), Statistical Process Control (SPC), and Six Sigma Projects etc.

4. Mathematical Optimization, Operations Research and Quantitative Techniques
    Linear programming models, Integer programming, Non-linear programming
5. Plant Layout Studies for reduction of material movement, operator movement and movement of salesmen etc.

6. Engineering Economics
    Engineering Economic Appraisals of projects submitted by Engineering Departments
7. Specialised Functional IE Solutions: SMED. Lean Manufacturing, BPR


Knols (Online Articles on these topics)

Human Effort Engineering

1. Principles of Motion Economy and Motion Study.
    Stop watch time study, worksampling, PMTS - MTM, MOST
3. Ergonomics

Ergonomics - Introduction

4. Safe Work Practice Design

5. Wage Incentives and Job Evaluation

Job Evaluation - Purpose - Consultants
1. Method Study and Methods Design

3. Statistics Based Techniques: Statistical Quality Control (SQC), Statistical Process Control (SPC), and Six Sigma Projects etc.

Statistical Quality Control – Industrial Engineering

4. Operations Research and Quantitative Techniques
    Linear programming models, Integer programming, Non-linear programming

Operations Research - An Efficiency Improvement Tool for Industrial Engineers

5. Plant Layout Studies for reduction of material movement, operator movement and movement of salesmen etc.

6. Engineering Economics
    Engineering Economic Appraisals of projects submitted by Engineering Departments
7. Specialised Functional IE Solutions: SMED. Lean Manufacturing

Related Knols
Industrial Engineering - Knols of Narayana Rao K V S S


Related Papers and Articles


Updated 12 November 2016,  26 Dec 2012

Original Knol Number 3159

Monday, October 24, 2016

Warehouse Productivity - Efficiency Improvement

Productivity Improvement and  Warehouse Optimization Techniques


Industrial Engineered Labor Standards

Industrial engineering has human effort engineering component. It consists of motion studies and design incorporating research of ergonomics and work measurement.

According to industrial engineering principles, the output of individual operators in a group can differ by 100%. Also, in a non incentive fixed payment system, operators work at 67% of the industrial engineering standard output.  That means the average worker produces output at only 67% of the standard. So a warehouse or DC operating without a formal labor management program that includes labor standards and incentives operates at about 65-70% of its potential output. This means that by adopting labor standards and payment systems that compensate workers for their productivity compared workers in other establishments, warehouses can improve  labor productivity by 30-35%, without burdening workers.

Motion Studies

While the mere act of measuring workers has proven to increase performance, the real productivity gains come from getting everyone doing the right tasks the right way. For example, if you have 100 workers in your DC, you will have 100 different ways in which the workers will do their jobs, if you have not specified particular methods. What are the chances that every one of them is the most efficient? The answer is ZERO. Motion study attempts to record the way motions are performed to do various tasks in the warehouse, and evaluates them to find out best practices of the operators. Then the best practices can be specified as standard methods. Apart from that motion studies can assess even the best practice in terms of certain principles of motion economy. When there is a need they improve the present best practice further. Thus motion studies improve productivity.

Motion study based job design and the development of standards is not necessarily something a warehouse management system will do for you. System-directed work from the system can accomplish the "right tasks" part, but getting everyone to do their tasks the "right way" is more complicated. It requires good motion design, and creating fair and accurate labor standards to measure the workers against these methods.

Man-Machine Task Improvement

Motion study has its focus on the motions performed by a worker. But is he doing task with proper tools, machines or equipments and machine movements?. Operation analysis and process improvement methods of industrial engineering contribute in eliminating waste in man-machine tasks.

By using experienced industrial engineers to study your jobs, equipment, and environment, the single most efficient method for completing each job and task can be determined. This critical steps of developing preferred methods, motions and engineered standards, along with proper training and change management, provides a quantum jump in productivity in companies.

Assigning Right Tasks to Reduce Time Taken to do Multiple Tasks

 Task interleaving:
Once you know how long it should take to complete each task based on preferred methods and engineered standards, you can leverage this information in a number of ways to improve labor productivity and utilization. System-directed task interleaving, also known as dynamic task management, is an automated function that allots tasks to workers by optimizing total time taken. Workers waste time if they have to travel back and forth from a central location to pick up their next assignment. By utilizing task interleaving, workers are directed to their next task from the location where they completed the present task,  based on priorities, proximity and their qualifications. With system-directed work, workers receive their next assignment on their mobile devices as soon as the previous task is completed, eliminating wasted travel. For example, a forklift driver replenishing an item in racks might be directed to pick a nearby pallet and take it to a loading dock or return a stack of empty pallets to a palletizer as the next task.

Also, by intelligently grouping picks into "batches" modern warehouse management solutions can significantly increase picking efficiency by enabling workers to pick multiple orders at the same time. This reduces travel and order fulfillment times.


In warehousing, slotting is the intelligent positioning of merchandise for the purpose of optimizing order fulfillment efficacy. Slotting involves identifying the most efficient placement for each item in a distribution center or warehouse.

If the inventory in your DC has any degree of seasonality, if you support weekly/monthly campaigns for promotional item fulfillment, or if you have a fair amount of new SKU introductions into your facility, you could benefit substantially from placing them in forward racks or pick areas. Proper slotting of high velocity SKUs can significantly reduce pick travel time as well as minimize pick-line congestion, thus making pickers much more productive.

Slotting tasks can be handled  by the warehouse management solution, such that any re-slotting is minimum and decisions related to reslotting are also taken in an optimal way.                    


No one process or system will single-handedly maximize your productivity.

Could your DC layout better facilitate your current and future operations? Do you have industrial engineers trained in developing preferred methods and engineered standards? Who will handle the critical change management process?

Warehouse Industrial Engineering - Warehouse Efficiency Improvement - Bibliography


Sunday, October 23, 2016

Evolution of Zero Wastes Movement in Factory Production - Philosophies, Methods, Techniques, and Tools

Adam Smith described division of labor that provides Zero Waste of Skills (Certain skills are specialised by certain persons)

Charles Babbage advocated division of labor within a manufacturing process of product by by insisting that the process has to be broken into more skilled and less skilled jobs. Different persons are employed in the process to take care of more skilled and less skilled jobs. The benefit less payroll expenses and more utilization of high skilled persons.   - Zero waste of high skilled persons.

F.W. Taylor -  Efficiency improvement of factory operations - Zero waste of ability of machine - Zero waste of work capacity of operators in manual and machine supporting work.

Frank Gilbreth - Motion Study - Zero waste of motions of operators.

Maynard - MTM and MOST time measurement systems - Zero waste of manpower due to rating differences and lack of planning the motions from a design perspective.

Taiichi Ohno - Zero Inventory, Zero Overproduction, Zero Idle Time of Men (multiple machine allottment)

Shiego Shingo - Zero Changeover time and Zero Defects through Poka Yoke

Quality gurus - Zero Defects

House of Quality - Zero Customer Dissatisfaction

Six Sigma  - Zero Defects

Total Productive Management - Zero Breakdowns

Zero Accidents

The application of 7 Zeroes in improvement of Lean and Agility manufacture
DECEMBER 2013, VOL 5, NO 8

Management of Design To Value Programme

The design-to-value approach can help  companies boost sales and profitability—but rolling it out across an entire product portfolio is no easy task.

Success factors for managing DTV 

McKInsey identied in 2013, four success factors for DTV programs: a clear vision set by top management, effective cross-functional governance, a dedicated working team, standardized tools
and processes.

Top management has to align functions across the organization involved in DTV enterprise program by developing and communicating a clear vision for the DTV program. Leaders can make that
vision actionable by developing plans that aim at stretch targets which are smart. The product level teams have to be given the responsibility of developing fact collection, idea generation, idea assessment and program implementation plans with timelines. Also there has to be plan for DTV application to specific number of products in the coming year and future years. Senior management needs to organize a structure to implement the DTV process. They need to hold review meetings as a part of directing and control functions.

Cross-functional governance

A cross-functional governance body for DTV efforts has to be created. This entity needs to include managers from all relevant functions—Product management, R&D, marketing, procurement,
finance, manufacturing, industrial engineering and product development at the corporate level and business unit level. The governance body has an important role to play early in the DTVprocess to identify the resources required to initiate and implement DTV program and provide those resources., both by ensuring that the company generates enough high-impact ideas in its
priority areas and by selecting the ideas to be implemented.

As DTV efforts progress, the governance body would monitor performance; help resolve any
conflicts among functions, emphasizing the importance of finding feasible solutions that
deliver the best value for consumers; and ensure that important projects receive sufficient funding.
Any abandoning of any specific project in the DTV project of a product needs to be approved by the cross-functional governance body.

Members of the governance body have to serve  as DTV “ambassadors” by informing the success of DTV projects and best practices to various groups in the company and mainting the positive attitude towards the initiative till it becomes a part of the accepted tool and process kit of the company.

Dedicated DTV teams

Many companies that initiated DTV failed to allocate enough employees to DTV projects. Creative
thinkers in sufficient numers are to be involved early in the project to develop sufficient number of high-impact, feasible ideas. Persons with expertise in design, value analysis, value engineering and process improvement are required in good number during rollout of specific projects based on the ideas. . The business functions or business units are to be persuaded to release people from their daily responsibilities to work on DTV, as this is a strategic initiative that will give results in the future..
In some companies top-managements mandated creating core DTV working teams for key product categories that remain intact for the duration of DTV projects. These teams for product specific categories also include experts from  marketing, R&D, purchasing, manufacturing, industrial engineering and finance.

Standardized tools and processes

The functional groups use a variety of tools or processes for design related activities performed by their group. As persons from different functions form a cross-functional team, the lack of a common
language makes alignment and collaboration difficult. The right activity at the outset has to be development of standardized tools and processes across the organization. The important techniques include marketing related activities, teardown related activities, and clean-sheet cost-modeling techniques.     

Time Frame for Expanding DTV efforts across the portfolio

It takes time for DTV efforts to generate significant results over the entire portfolio of products after the initial decision by the company to initiate the effort. It typically requires two to three years from start to finish, including embedding the approach across the product portfolio. McKinsey identified
three phases in the implementation process: : start-up, idea generation, and rollout.

The start-up phase, is  three to six months long. During this phase., the company establishes the
basic organizational and management structure for DTV and develops the necessary technical
skills and tools and work with limited number of core products.

Once a company gains confidence in its DTV technology and infrastructure, the idea generation
phase—usually a six- to nine-month start using more sophisticated tools.

During the rollout phase,  the implementation of the selected ideas are implemented in value chain activities. It may take 12 months to complete this phase initially. As the success is realized in the early product, the DTV process can be implemented in more products with a short time horizon. Many companies are now giving 12 month horizon to idea generation and implementation. At any time number of parallel projects in variety of products take place.

Based on McKinsey Note
Capturing the full potential of design to value