Monday, September 18, 2017

Productivity Management

Principles of Industrial Engineering 

1. Develop science for each element of a man - machine system's work related to efficiency and productivity.
2. Engineer methods, processes and operations to use the scientific laws related to the work of machines, man, materials and other resources to improve economic efficiency and productivity.
3. Select or assign workmen based on predefined aptitudes for various types of man - machine work.
4. Train workmen, supervisors, and engineers in the new methods, install various modifications related to the machines that include productivity improvement devices and ensure that the expected productivity is realized.
5. Incorporate suggestions of operators, supervisors and engineers in the methods redesign on a continuous basis.
6. Plan and manage productivity at system level.

Productivity Management

What is management?

Management is a planned and systematic activity for effectiveness and efficiency in accomplishing objectives.

An activity is management effectively by planning and confirming that it meets the requirements of the customer and the profit goals of the organization (includes partnerships and sole proprietors). Then  the organization of resources has to be designed, resources are to be acquired, human resources are to be trained and directed, other resources are allocated for various tasks, and put under the charge of operators, supervisors and managers and control action is taken to ensure that results follow plans or modified plans.

Efficiency is also attained by taking care of it during planning, organizing, acquiring of resources and their allocation, training and directing human resources and control phases.

Effectiveness is concerned with providing the goods and services that persons desire with various benefit and attribute bundles.

Efficiency is concerned with minimizing the resources spent in the production of desired goods or services.

Important Functions in Productivity Management

Organization Productivity Policy  Management

Department Productivity Policy and Management

Cross-functions Productivity Policy and  Management

Production Training and Promotion

Top Management Productivity Control

Promotion of Productivity Improvement Program

1. Spelling out the goals of the productivity program for the next year and next five years or a five year plan by the CEO

2. Forming a Productivity Steering Committee of Top Executives

3. Demonstrating the commitment to productivity program by the CEO and other top executives

4. Organizing and Reorganizing the Productivity Management Department

5. Declaring the Introduction of Productivity Improvement Program or Yearly Productivity Plan by the CEO.

6. Organizing Grade by Grade Training in Productivity Improvement.

7. Creating Productivity Improvement Circles in each department.

8. Forming cross functional Management Committees

9. Productivity Audits by Various Levels of Management

10. Productivity Rewards at Productivity Case Study Contests and Productivity Review Seminars.

11. Best Practice Identification Workshops

12. Sending Operator Teams and Manager Teams to National and International Teams to present their achievements and learn from other organization achievements.

13. Productivity News Letter Creation and Distribution through print and online channels.

14. Reporting Productivity achievements in Annual reports of the company.

Organizing and Reorganizing the Productivity Management Department

If presently there is no specific department that looks after productivity improvement, the organization has to create one to have systematic productivity improvement program. At the top of the productivity program there can a single manager or a cross functional committee chaired by one of the members of the committee. This department may need to be reorganized periodically to take care of increased responsibility and induction of more people, or reduction of more people, or starting of new sections to take care of new methods and techniques etc.

Productivity Promotion Office

The Need for Productivity Promotion Office

Etzioni’s (1965, 1975) model of organizational change refers to the conforming or nonconforming behavior of various persons in the organization and the expectations and performance goals of those in charge of planning and managing change. The total organization will change when nonconforming person's number approaches zero.  The model identified a sequence of four phases in change: education and promotion; commitment; performance; withdrawal of the special promotion effort as the organization change is completed successfully. The model does not, however, give the duration, and hence timing by which phase succeeds one another.

Japanese quality author, Hitoshi Kume writes that to build or develop a system in which people are proactive towards work improvement to improve output, certain new ways of presenting things are necessary.

1. People have to be presented information that helps in better understanding of the current situation of the organization. People are generally happy with long-surviving routines and do not see waste or the loss caused by them to the organization. Only when the fact that organisation is suffering due to that routine in a big way and there is a way to eliminate that waste through some effort is brought into their consciousness that people start thinking about the issue.  Such an insight sometimes can come to people when they are attending lectures by experts in waste elimination or in implementing some techniques that eliminate that waste, or by listening to success stories told in case study competitions, when visiting plants with best practices or consultant presentations. When the senior managers of the company realize this existence of waste, they can create a promotion team to make all the persons in company become aware of the waste. Productivity promotion has to do this type of promotion.

2. Encouraging operators to come out with improvement suggestions is important for their self development. Both Taylor and Gilbreth, the pioneers of scientific management and industrial engineering emphasized this point. The operators have to first follow the standard method designed as the best method at that point in time by the industrial engineering or scientific managers and then have to keep giving suggestions which will improve the method further. In the early days of scientfic management and industrial engineering all those suggestions were referred back to industrial engineers. But in Japanese companies, especially in Toyota Motors, after the second world war, this responsibility of evaluating and accepting the suggestions of operators was given to the supervisors and engineers of the shop. Engineers and supervisors are made responsible for continuous improvement of the processes with the involvement of the operators. Productivity promotion offices of the current day have to take up this self development aspect of productivity improvement  (good process change - kaizen) ideas as an important issues and ask all operators to think all the time to improve the method whenever they get an idea because of their reading, observation, or responding to an issue while working. It is to be stressed that supervisors are always ready to listen to improvement ideas and they have some time set apart for listening to improvement ideas of operators working under them.

3. Productivity promotion office also has to promote among all the supervisors and human relations personnel the idea that apart from doing the job effectively and efficiently and achieving results specified as a standard, a proactive mindset that thinks of more effectiveness and efficiency has to be developed in all operators. Supervisors have to provides the required inputs in creative thinking and provide routines or behavior opportunities and role plays in which creativity is exhibited and thus becomes a habit among operators.

4. Successful productivity improvement effort results in tangible results. Each successful project provides a taste of productivity improvement to the other members of the organization. The success when verified, validated and celebrated develops more operators and supervisors committed to the program. The role of Productivity Promotion Office or Section is to produce this snowballing effect. Productivity is to be promoted for bringing the abilities of people into production projects development and implementation. The chief of productivity promotion office is especially responsible for creating enthusiasm for productivity in the organization.

Productivity promotion office has to specially target persons who are not enthusiastic about productivity improvement at any point in time. Frederick Taylor indicated in 1911 itself, that objective demonstration, and teachers who are capable of the holding the hand of the operator and train him in the new efficient method are necessary for change of the mindset of people who are apprehensive of the new efficient methods. Productivity promotion office has to develop trainers of the new productive method and arrange for demonstration of objective and tangible results from a stream of productivity projects to convert more and more people into active supporters of the productivity program.  The persons working in the productivity promotion office need leadership ability, the ability of influencing people, perseverance to do productivity promotion over long periods of time, and have to be broad-minded and tolerant. They should not short tempered people who get upset with too few converts to productivity projects. The persons of the productivity promotion office have to be full of enthusiasm and belief in the productivity policy announced by the top management.

The Role of the Productivity Promotion Office

1. Acting the secretariat for the CEO and Productivity Steering Committee.

2. Drafting the Productivity Policy

3. Drafting the Productivity Promotion Plans

4. Program of promoting the productivity policy of the organization

5. Establishing the productivity management system

6. Program of promoting productivity circles.

7. Planning productivity training activity.

8. Keeping record of productivity improvement projects and unresolved issues relating to productivity improvement.

9. Planning top management audits of productivity practice.

10. Organizing productivity result sharing seminars, case study sessions, best practice sessions, and celebration events.

11. Compiling annual results of productivity improvement activity and collaborating with financial , cost and management accounting to arrive at financial contribution and capital and revenue expenditure incurred for productivity improvement activities and projects.

12. Preparation of books, articles, magazines and videos.

13. Establishment of a desk for providing productivity related help.

14. Management of productivity initiatives website of the organization.

15. Management of productivity library

Sustaining The Productivity Movement

Productivity promotion activity can be initiated and run successfully for number of years by the active participation of productivity promotion office. But once the promotion activity is reduced and stopped, the productivity improvement may slacken. It is not easy to sustain an activity without the an effort to sustain it. Hence, the productivity promotion section is to be substituted productivity sustenance section. This section has to develop information that reminds all the productivity improvement efforts other organizations and their results and remind the personnel of the organization the need to continuously promote productivity in their departments.

1. Every year the productivity policy management has to take place
2. Cross function committees are to be formed and the chairmen have to be appointed again.
3. Training programs at all levels have to continue as appropriate
4. Productivity circle activity has to continue
5. Top management audits have to take place.
6. Daily work management to achieve productivity has to implemented and practiced.
7. Important productivity breakthroughs have to be publicized.

This article is modeled on an article of TQM promotion

I included productivity management in functions of industrial engineering. I am trying to further expand the explanation of the topic.

Updated 19 September 2017, 20 November 2016

1 comment:

  1. I am trying to explain productivity management in more detail. Suggestions are welcome.