Thursday, May 24, 2018

May - Industrial Engineering Knowledge Revision Plan

First Week

Cost Information for Pricing Decisions
Cost Behavior Analysis and Relevant Costs

Costing for Strategic Profitability Analysis
Cost Information for Customer Profitability Analysis

Costing for Spoilage, Rework and Scrap
Costing for Quality, Time and the Theory of Constraints

Costing for Inventory Management, JIT and Backflush
Cost Information and Analysis for Capital Budgeting

Cost Information for Management Control and Performance Control
Cost Information for Transfer Pricing

Second Week

Managerial Accounting or Management Accounting - Review Notes
Relevant Information and Decision Making - Marketing Decisions

Relevant Information and Decision Making - Production
Relevant Information and Decision Making - HR

The Master Budget - Accounting Information
Flexible Budgets and Variance Analysis - Review Notes

Responsibility Accounting for Management Control
Accounting Information for Management Control in Divisionalized Companies

Capital Budgeting - Accounting and Cost Information
Introduction to Organizational Behavior

Third Week

Environmental context: Information Technology and Globalization
 Environmental context: Diversity and Ethics

 Organizational Context: Design and Culture
Organizational Context:: Reward Systems

Perception and Attribution
Personality and Attitudes

Motivational Needs and Processes
Positive Psychology Approach to OB

 Decision Making

Fourth Week

 Stress and Conflict
Power and Politics

Groups and Teams
 Managing Performance through Job Design and Goal Setting

 Behavioral Performance Management
Effective Leadership Process

Principles of Industrial Engineering Presented by Professor K.V.S.S. Narayana Rao (Author of this blog) on 23 May 2017 at the Annual Conference of Institute of Industrial and Systems Engineers in Pittsburgh, USA.  Industrial Engineering is a management subject or discipline with Engineering as the foundation. Its primary application area is engineering systems. It augmented application area is any system.  INDUSTRIAL ENGINEERING IS SYSTEM EFFICIENCY ENGINEERING AND HUMAN EFFORT ENGINEERING (Definition by Narayana Rao - Published in Udyog Pragati, Jounral of NITIE in 2006)

Download full paper - Principles of Industrial Engineering

Proceedings - 2017 Industrial and Systems Engineering Conference



Great Leaders: Styles, Activities, and Skills
Principles of Innovation

Innovation - Strategic Issues and Methodology
Idea Generation in Organizations

One Year Industrial Engineering Knowledge Revision Plan

January - February - March - April - May - June

July - August - September - October - November - December

Cost Measurement is an important skill and practice area for industrial engineers,
See the slideshow - Introduction to Industrial Engineering


Uploaded by Narayana Rao

Understanding human behavior, the content of the subject Organizational Behavior is also important for industrial engineers  to train operators in the redesigned methods and also to interact with them during the observation phase of the IE study and then involving them in developing new methods. Understanding human behavior is also essential to understand his commitment to work at 100% rating, commitment to zero defect production, and active participation in total industrial engineering efforts.

Updated  24  May 2018,
26 May 2017,   Principles of Industrial Engineering video added., 9 May 2015

Blockchain Technology - Productivity and Cost Reduction Potential

Applied Industrial Engineering

Industrial Engineering have to have monitor technology environment to spot new technologies that have productivity improvement potential and take steps to adopt those technologies in their organization processes.

Productivity potential of new technologies are to be assessed qualitatively in early days and then quantitatively as pilot implementations and use cases take place.


Often, productivity and security are seen as conflicting demands in business. But blockchain technology offers the potential to improve both. And now is the time for miners to see how it can work for them.

Blockchain: what does the future hold for blockchain in Australia?
Our study explores how blockchain technology could be used across government and industry in Australia to deliver productivity benefits and drive local innovation.

Funded under the National Innovation and Science Agenda, we have delivered two reports that examine the risks and opportunities of blockchain technology in Australia.

We identified the following benefits for businesses.


Since they remove the need for a third party, blockchains can reduce the number of stakeholders involved in a transaction therefore reducing cost and saving time. Blockchains can also enable better information sharing and better business processes, giving stakeholders more confidence and reducing cost and risk.

Using distributed leders, many kinds of business transactions can be decentralised, eliminating the cost, complexity, and slowness of involving trusted intermediaries. Smart contracts provide new ways to automate complex, multi-party business transactions which reduce costs and increase the velocity of business.


Productivity In Society & The Blockchain
How and how much the blockchain can help improve productivity of our companies, governments, and society at large
Vivek Singh
Sep  2017


The Winning Blockchain Pattern For 21st Century Productivity
December 30, 2015

Productivity Engineering - Principle of Industrial Engineering


Download full paper - Principles of Industrial Engineering
Proceedings - 2017 Industrial and Systems Engineering Conference

2-Productivity Engineering


Productivity Engineering - Principle of Industrial Engineering

Industrial engineering is concerned with redesign of engineering systems with a view to improve their productivity. Industrial engineers analyze productivity of each  resource used in engineering systems and redesign as necessary to improve productivity.

It has to be ensured that the increase in productivity due to the use of low-cost materials, processes and increasing speed of machines and men, should not lead to any decrease in quality of the output.



Productivity Engineering

Productivity engineering is applied to products or services and processes. Engineering processes are present in design, manufacturing, construction maintenance, operation, transportation, materials handling, and information processing etc. Engineering processes are present in agriculture and related activities and service businesses.

Productivity Engineering - Productivity Improvement Techniques (PITs)

Indicated by David Sumanth

Technology Based PITs

2. Robotics
3. Laser technology
4. Renewable energy
5. Energy conservation
6. Rebuilding old machines
7. Group Technology
8. Advanced and Recent Maintenance Technology
9. Material Handling Technology 
10. Material Reuse and Recycling

Product Based PITs

1. Value Engineering
2. Product Diversification
3. Product Simplification
4. Product Standardization
5. Product Related Research and New Product Development
6. Product Productivity Improvement through Reliability Improvement

Process (Task) Based PITs

1. Methods Engineering

New Productivity Improvement Techniques (PITs)

Technology Based PITs

1. Industry 4.0 Technology Set and Applications
2. Artificial Intelligence
3. Data and Business Analytics
4. Autonomation
5. PokaYoke

Product Based PITs

1. Design to Cost
2. Design for Value
3. Frugal Innovation
4. Smart Products

Process (Task) Based PITs

1. Process Reengineering
2. Smart Manufacturing
3. Cloud Computing
4. Six Sigma
5. Lean Manufacturing (Toyota Production System)

Updated 2018 - 25 May
First Published  29 June 2017

Wednesday, May 23, 2018

Productivity Science - Determinants of Productivity

Productivity Science is a principle of Industrial Engineering

Develop a science for each element of a man - machine system's work related to efficiency and productivity.

The productivity science developed is the foundation for industrial engineering in productivity engineering and productivity management phases.

Productivity Science - Principle of Industrial Engineering

Capital Stock

Mustafa Nedium SUALP and Cemil Faruk DURMAZ, "The Relationship between Knowledge Capital, Spillover Effects and Labor Productivity",

Empowerment and Productivity

Fluid Intelligence  

Fluid Intelligence - Productivity

A Theory of Intelligence and Total Factor Productivity: Value Added Reflects the Fruits of Fluid Intelligence
Taiji Harashima
Kanazawa Seiryo University
7 December 2012

Online at


Groups influence the productivity of employees.

Donnely, Jr., James H., Gibson, James L., and Ivancevich, John M. Fundamentals of Management: Functions, Behavior, Models, Business Publications, Dallas, Third Ed., 1978,  p. 243.

The reference is quoted in the book, Organizational Behvaior by Fred Luthans.

Group Cohesiveness

Group cohesiveness influences productivity.

The point is indicated in the book, Organizational Behavior by Fred Luthans.

"An Experimental Study of Cohesiveness and Productivity"

Stanley Schacter, Norris Ellertson, Dorothy McBride and Doris Gregory
Human Relations 4(3):229-238 · August 1951

"Group Productivity, Drive and Cohesiveness"

Ralph M. Stodgill,
Organizational Behavior and Human Performance
Volume 8, Issue 1, August 1972, Pages 26-43

"Group Cohesiveness and Productivity: A Closer Look"

Peter E. Mudrack,
Human Relations
Volume: 42 issue: 9, September 1, 1989 page(s): 771-785

"Team Cohesion and Individual Productivity: The Influence of the Norm for Productivity and the Identifiability of Individual Effort"

Kimberley L. Gammage, Albert V. Carron, Paul A. Estabrooks
Small Group Research, Volume: 32 issue: 1, February 2001,  page(s): 3-18

Knowledge Capital

Mustafa Nedium SUALP and Cemil Faruk DURMAZ, "The Relationship between Knowledge Capital, Spillover Effects and Labor Productivity",  Marmara Universitesi iktisadi ve idari


Learning by doing - Possible only if demand is there to support growth in output.  Veedorn - Labour Productivity related relation

D.P. Priyadarshi Joshi and Susanta Kumar Sethy "Manufacturing Productivity Growth in India: Revisiting Veedorn's Law", Productivity, Vol. 58, No. 1, Aprl - June 2017, pp. 39 - 52.

R&D Expenditure

Mustafa Nedium SUALP and Cemil Faruk DURMAZ, "The Relationship between Knowledge Capital, Spillover Effects and Labor Productivity",


Increasing returns to scale

D.P. Priyadarshi Joshi and Susanta Kumar Sethy "Manufacturing Productivity Growth in India: Revisiting Veedorn's Law", Productivity, Vol. 58, No. 1, Aprl - June 2017, pp. 39 - 52.

Sourcing Strategies

Sourcing strategies and productivity: Evidence for Spanish manufacturing firms
José CarlosFariñasa, AlbertoLópeza, AnaMartín-Marcos
BRQ Business Research Quarterly
Volume 19, Issue 2, April–June 2016, Pages 90-106


Mustafa Nedium SUALP and Cemil Faruk DURMAZ, "The Relationship between Knowledge Capital, Spillover Effects and Labor Productivity",

Technology Transfer

Mustafa Nedium SUALP and Cemil Faruk DURMAZ, "The Relationship between Knowledge Capital, Spillover Effects and Labor Productivity",

Type of Organization

Corporate Sector, Cooperative sector, Partnership, Proprietory

D.P. Priyadarshi Joshi and Susanta Kumar Sethy "Manufacturing Productivity Growth in India: Revisiting Veedorn's Law", Productivity, Vol. 58, No. 1, Aprl - June 2017, pp. 39 - 52.


"When urbanization rates in districts or in states cross the threshold of about 35 percent, we start seeing productivity benefits kick in. You see higher GDP per capita because the dense cities and urban centers will have better connections with the rest of the world and with  markets. Citizens have better access to education, health, and so on and this will also help in improving productivity."
As you get to that 35 percent, the actual per capita GDP in that particular district more than doubles.

Quotation from
India’s economy: Why the time for growth is now
McKinsey Global Institute September 2016

30 Factors that Affect Productivity - Prof Mali

Given by Prof Paul Mali in the year 1978 in the book,  Improving Total Productivity, John Wiley & Sons, New York.

Fourth Level Factors (Affect most directly): 
Effectiveness (Focus on customer requirements), 
Efficiency (Focus on planned resource consumption)

Third Level Factors:  
Skills, Motivation, Methods, Cost (measurement, may include time and productivity measurements also).

Second Level Factors: 
Leadership, Experience, Climate, Incentives, Schedules, Organizational structure, Technology and Materials.

First Level Factors (Affect least directly): 
Abilities, Style, Training, Knowledge, Physical conditions, Unions, Social awareness, Aspiration levels, Processes, Job design, Goals, Policies, R & D, Plant and Equipment, Standards, and Quality.

Updated 2018, 24 May 2018,    22 March 2018,
12 November 2017, 26 October 2017

Sunday, May 20, 2018

Strategy, Cost and Industrial Engineering - Presentation - Transcipt

Strategy, Cost and Industrial Engineering

Books referred

Strategic Management and Competitive Advantage

J.B. Barney and W.S. Hesterly


Decisions that assure that a firm has products or services that have a profitable demand for a long period of time

Competitive Advantage

A firm has competitive advantage when it is able to create more economic value than rival firm or firms.

Economic value is the difference between the perceived benefits gained by a customer and the full economic cost the product or service.

Gaining or Increasing Competitive Advantage

Increasing the perceived benefits gained by a customer (Differentiating the product or service by providing more benefit – Product/service improvement based strategy).

Decreasing  the full economic cost the product or service (Cost based strategy).

Business Level Strategies

Two Generic Business Level Strategies

Cost Leadership: generate economic value by having lower costs  than competitors
Example:  Wal-Mart

Product Differentiation: generate economic value by offering a product  that customers prefer over competitors’ product
Example:  Harley-Davidson

Industrial Engineering and Cost of Products

Industrial engineering optimizes (minimizes) cost of resources to produce the products and services at the designed level of quality.

Industrial engineering uses rationalization  to identify wastes and eliminates them from products and processes.

IE and Continuous Improvement

IE encourages all the employees to contribute ideas to reduces costs in various microlevel elements and tasks that help in continuous reduction of cost elements.

IE and Cost Reduction/Process Improvement Projects

IE department periodically undertakes process improvement projects to incorporate the latest efficiency improving technologies into the processes and contributes to cost reduction.

Industrial engineering identifies engineering changes in products and processes in the system that give productivity improvement and cost reduction.

Periodic Mathematical Optimization of Costs

Thus there are opportunities to do mathematical, statistical and OR based optimization periodically.

Cost Leadership Business Strategy

A firm that chooses a cost leadership business strategy focuses on gaining advantages by reducing its cost to below those of all its competitors

Popular companies following cost leadership strategies

Ryanair – Air travel
Timex and Casio – watches
BIC – disposable pen and razors
Walmart - Retail

What factors or actions create cost advantage?

Economies of scale
Diseconomies of scale create cost advantage sometimes – Mass versus Lean production
Experience difference – Learning curve economies
Acquisition of low cost productive inputs
Technology advantages independent of scale
Management policies

Economies of Scale

average cost per unit falls as quantity increases until the minimum efficient scale is reached

are a cost advantage because competitors may  not be able to match the scale because of capital
requirements (barrier to entry).

international expansion may allow a firm to have  enough sales to justify investing in additional
capacity to capture economies of scale.

Diseconomies of Scale

are an advantage for those who do not have  diseconomies of scale
occur when firms become too large and bureaucratic
are a risk of international expansion

Learning Curve Economies
a firm gets more efficient at a process with experience
the more complicated/technical the process,  the greater the experience advantage
international expansion may propel a firm down the  experience curve because of higher volumes

Differential Low-Cost Access to Productive Inputs
may result from:
history—being in the right place at the right time
being first into a market—esp. foreign markets
locking up a source—buying all of its output

Technology Independent of Scale
may allow small firms to become cost competitive
advantage typically accrues to the ‘owner’ of the  technology—may or may not be the ones who actually  use the technology
size of the advantage depends both on how valuable  and protectable the technology is
Industrial engineering department plays a key role in this.

Policy Choices
firms get to choose how they will serve the market
we’ll offer level of quality that is inexpensive to  produce
firms can make policy choices that give people  incentives to reduce cost at every opportunity 
Organization: Having staff consultants who decrease costs on a continuous basis using IE methods.

Cost Leadership & Competitive Advantage

A source of cost advantage will lead to competitive advantage  if that source is:

Costly to Imitate
Organized (Implemented Appropriately)

Updated 2018 - May 2018

First published 22 September 2013

Industrial Engineering Strategy

Industrial engineering is profit engineering. (Taiichi Ohno)

Industrial engineering is profit engineering. If a company is not employing industrial engineering it is unnecessarily foregoing profits inherent in the products that it developed and designed to the performance satisfaction of good number of users. Profit conscious managers and owners have to understand and employ industrial engineering to achieve the full profit potential of their products.

What are your strategic decisions related to industrial engineering function?

1. What is your productivity/Efficiency Improvement - Cost Reduction goal?

2. Are you planning to realize experience curve effect benefits?

3. How much of the cost reduction - productivity improvement should come from specialist industrial engineers and other engineers and managers?

4. What will be the ratio of industrial engineers to other engineers and managers?

5. What bottlenecks or limiting factors have you identified in you facilities?

6. What techniques are going to receive special emphasis?

7. What is your training plan for specialist industrial engineers and other engineers and managers?

8. What is the top management attention to industrial engineering - productivity improvement - cost reduction activity?

9. What is the research and development budget for IE activity?

10. What is the total budget for productivity improvement? What is the budget for productivity projects to be initiated by industrial engineering department? What is the budget for productivity projects to be initiated by operating departments?

1. What is your productivity/Efficiency Improvement - Cost Reduction goal?

Total productivity management promoted by Japan Management Association, covered as a chapter in the Maynard Handbook (5th Edition) advocates setting up targets for cost reduction and productivity improvement. Similarly, Yamashina talks of manufacturing cost reduction deployment as a strategic decision in his world class manufacturing implementation. Total industrial engineering is one of the pillars of WCM promoted by Yamashina.

2. Are you planning to realize experience curve effect benefits?

Experience or learning curve effect is identified as one of the strategic cost drivers by strategic management literature in implementing cost leadership strategy (Creating and Executing Strategy: The Quest for Competitive Advantage, 14 Edition, Arthur Thompson Jr., A.J. Strickland, John E. Gamble and Arun K Jain, Tata McGraw Hill, 2006  p.119). Companies have to determine the slope of their learning curve and assess whether it is in line with the industry and have to take actions to improve learning in organization. Hence they have to plan to realize the experience curve effect.

3. How much of the cost reduction - productivity improvement should come from specialist industrial engineers and other engineers and managers?

F.W. Taylor (1911)  identified that production work was being carried out without the support adequate science. Taylor developed science of machine working as well as manual working in certain activities and developed his scientific management thought and promoted industrial engineering as a subject and as a full discipline in engineering institutions.  He recommended specially educated and trained industrial engineers to take up the work of developing science in various production activities and improvement of production processes using the science. According to Taylor, foreman at that time was already overloaded and similar is the case with senior production managers also as they were working without the support of staff specialists.

By 1930s, the situation changed. Alan Mogensen identified that processes redesigned by industrial engineering using the recent discovered science can further be improved by the involving operators and supervisors as they observe many minor improvement opportunities in the doing the work day after day. He came out with work simplification program to involve operators, supervisors and engineers in operation/process improvement. According to Allen Mogensen, Work Simplification is the organized use of common sense — on the part of everyone Involved — to find easier  and better ways of doing work.

Toyota Motors made exemplary use of utilizing the knowledge of every body in the production system to improve processes and operations. Now companies have a policy choice to make. What proportion of planned cost reduction will come from science/analysis based projects from industrial engineers and what proportion will come from line organization. The targets have to be included in the budgets of the various departments accordingly.

4. What will be the ratio of industrial engineers to other engineers and managers?

This decision is contingent of the decision above. The company has to employ some industrial engineers to promote total industrial engineering. Above that the number of IEs to be employed and their engineering background, and functional experience depends on the company's policy decisions regarding the planned cost reduction and responsibility given to IE and line departments.

5. What bottlenecks or limiting factors have you identified in you facilities?

Manufacturing cost reduction deployment is a topic in project appraisal chapter of financial management books as well as engineering economics and managerial economics books. They recognize that certain project proposals contain cost reduction a the benefit of the project. Yamashina in his WCM explicits recognizes cost reduction projects as a major input into the budgeting process and comes out with a mathematical model to select a cost reduction project portfolio for the coming period. In this context, company has to identify its limiting factors or bottlenecks whose productivity has to be improved by employing industrial engineering techniques. Based on this identification, the company personnel may come up with productivity improvement projects that make a significant improvement in the operation of the bottleneck facilities.

6. What techniques are going to receive special emphasis?

IE techniques are continuously refined and new techniques are being developed. The company has to opportunity of taking decisions on the intensive use of some techniques during the coming periods. For example many companies in India are now focusing on six sigma and industrial engineering techniques named as lean manufacturing or Toyota Production System to realize cost reduction and productivity improvement.

7. What is your training plan for specialist industrial engineers and other engineers and managers?

Based on the strategic decisions in the area of industrial engineering, the company has to conduct training programs to sensitize the employees on the need to use specified techniques and provide skills to those employees who presently do not have them. There is always a need to share recent success stories within the company as well as from other companies.

8. What is the top management attention to industrial engineering - productivity improvement - cost reduction activity?

If productivity is a strategic issue (it is for many companies as world's top companies declare their productivity improvement and cost reduction targets - Volkswagen and Coca Cola in 2014), top management has to participated in planning, organizing, resourcing, directing and controlling productivity improvement. They need to allocate time and participate in various activities related to productivity. Long time back, when Birla group was introducing WCM, in the first work shop of defect or waste identification, it was said that K.K. Birla, the chairman of the group himself participated to observe the work place and identify waste. Motilal Oswal, Motilal Oswal Securities Limited was another CEO, who participates in many training programmes organized by the company with enthusiasm.

9. What is the research and development budget for IE activity?

If companies have to use industrial engineering and enjoy the increased profits, they have to contribute to its theoretical development and first time application of the theory in company systems. Theoretical development is referred to as research and first time application is referred to as development. While, the big companies have a major responsibility to fund big projects, even smaller companies can contribute through their industry associations, industrial engineering professional organizations. In the context, it is important to note that the 2014 National Conference on Industrial Engineering by NITIE, was sponsored by BHEL, RCF, Neyveli Lignite Corporation and  Adani Gas Ltd.

10. What is the total budget for productivity improvement? What is the budget for productivity projects to be initiated by industrial engineering department? What is the budget for productivity projects to be initiated by operating departments?

Tweeddale J.W - Technology and Productivity

Tweeddale J.W. (1982) Productivity Enhancement: An Approach to Managing Beneficial Change in a Military-Industrial Work Setting. In: Mensch G., Niehaus R.J. (eds) Work, Organizations, and Technological Change. NATO Conference Series (II Systems Science), vol 11. Springer, Boston, MA

The paper describes the fund allocation and schemes for productivity improvement projects in Navy in 1982. It is good 

Related articles and Papers by Narayana Rao, K.V.S.S.

1. * Definition of Industrial Engineering

"Industrial Engineering is human effort engineering and system efficiency engineering." 

(Narayana Rao)

“Definition of Industrial Engineering: Suggested Modification”, Udyog Pragati, October-December, 2006.

Definition published in IIE (International)  magazine "Industrial Engineer,"  March 2010.   

2.“The Basic Role of the Industrial Engineer”, Udyog Pragati,     October-December, 1999.

3.“Definition of Industrial Engineering: Suggested Modification”, Udyog Pragati, October-December, 2006.

4.“Industrial Engineering: A Neglected Discipline in Management Literature,” Proceedings of AIMS 5th International Conference on Management, Hyderabad, December 2007.

5.“Role of Industrial Engineers in Technology Commercialization”, Proceedings of AIMS 5th International Conference on Management, Hyderabad, December 2007.

6.“The Concept of Human Effort Engineering: HR Dimension,” International Conference on Management,  HK Institute of Management & Research, Mumbai, 20-21 March, 2009.

7.“Human Effort Engineering and Human Resource Management,” Proceedings of HR Seminar organized by Naval Dockyard, Mumbai, 15th October 2009.

8.“Industrial Engineering and Basic Engineering Disciplines – Is Link Missing?”, AEDGE International Conference, HK Institute of Management & Research, Mumbai, Oriental Institute of Management, Mumbai, and University Utara Malaysia, 4-6, March, 2010.

9.“Industrial Engineering of Systems - System Industrial Engineering,” Proceedings of  Tenth global Conference of Flexible Systems Management, GloGift, Keio University, Yokohama, Japan July 26-27, 2010.

10.“Taylor to Yamashina - Employee Involvement in Industrial Engineering Projects,” Full paper reviewed and accepted for the 2011 Industrial Engineering Research Conference, IIE, USA, Reno, Nevada, May 2011

11.“The Primary Role of Industrial Engineer – Efficiency Management Internal  Consultant to Engineering Managers”, Udyog Pragati, July – September,2013

12.“The Objective and Organization of Industrial Engineering – Intent of Founders of the Discipline”, IIIE International Conference on Managing Supply Chain for Global Competitiveness, Nagpur, 25 – 27 October 2013.

13.Technology Efficiency Engineering - An Important Task of Industrial Engineering”, Proceedings of 2nd International Conference on Industrial Engineering, ICIE 2013.

14.“Industrial Engineering and Productivity Management in Coal Mining and Utilization: A Study with Special Reference to India”, Proceedings of 32 Annual International Pittsburgh Coal Conference, Pittsburgh, October 5 – 8, 2015.

15.“Machine Work Study – Man Work Study – Taylor’s Conceptualization of Scientific Study of Man-Machine Systems”, Proceedings of National Conference – NCIETM 2016 held at NITIE, Mumbai, 17 – 19, November 2016.

16.“Principles of Industrial Engineering”, IISE (Global Association of Industrial Engineering) Annual Conference, Pittsburgh, May 2017. Principles were developed and presented for the first time in the discipline.

17.“Functions and Focus Areas of Industrial Engineering”, Under Print (Coming issue of Udyog Pragati, published by NITIE.

Papers on Industrial Engineering and Strategy

P. Leonard, P.S. Kruger and C.M. Moll
Department of Industrial and Systems Engineering
University of Pretoria, South Afric2006 paper based Phd thesis

A strategic engineering philosophy
Leonard, Pierre
Date: 2005-05-09

Updated 2018 - 21 May
First published 2 December 2014

Saturday, May 19, 2018

High Productivity Through Smart Factories - Industry 4.0 - Bulletin Board

Productivity  - Productivity Science - Productivity Engineering - Productivity Management

Productivity Science

Productivity Engineering

Productivity Management


Technology Trends 2018 Accenture

Citizen AI - Extended Reality - Data Veracity - Frictionless Business - Internet of Thinking

Prof Vittal Prabhu, Prof of IE of Penn State in India during 2018-19

The research project for which he was granted the Fulbright Fellowship is titled “Smart Systems Engineering: Applications in Manufacturing and Service Industries.”

Future of Driverless Vehicles

Tidfore and FLSmidth cooperate in bulk material handling equipment intelligentizing

Innovations for the Digital Production of the Future - Volkswagen


Siemens CEO on Industry 4.0

Cube Automation,212,0,0,html/Smart-Factoree-Overview

We Deliver Results in Productivity


Industry 4.0 and Smart Factory Logistics by Bossard
Proven Productivity


Smart Machines

Smart Vertical Center - a compact machine designed for high - performance and unsurpassed value
The Smart series are designed for high productivity, compact design and environmental considerations. They provide high efficiency machining thanks to the No. 40 taper spindle with maximum spindle speed of 12000 rpm and high speed feed rates.

Smart Chocolate Factory: increased productivity and quality - Bühler
April 2017

Smart Chocolate Factory: increased productivity and quality
It is increasingly important for chocolate producers that their plants operate at full capacity. At the Interpack trade show, Bühler is demonstrating how the use of digital services and IoT technologies offers significant gains in efficiency: "With more intelligent process control, we can further improve productivity and achieve even more consistency in product quality,"


The Ministry of Trade, Industry & Energy, South Korea (MOTIE) announced on March 10, 2016 that it has assisted in the construction of smart factories in 1,240 small and medium enterprises (SMEs). Smart factories are  defined as facilities that are fully automated based on information technology. The smart facilities have improved the SMEs’  productivity by approximately 25%.



Published on 3 Dec 2015
MES can improve your shop floor productivity by over 30%. FORCAM MES relies on real-time data processing and machine data collection in order to identify potential of optimisation. User-friendly reports and visaulisation help you monitor work orders throughout the manufacturing process and keep trace all production related data. The Smart Data generated ensures that you can stay pro-active and make sure production is on track and up to the quality standards your customers expect.

Smart Factory - A Step towards the Next Generation of Manufacturing

Lucke D., Constantinescu C., Westkämper E. (2008) Smart Factory - A Step towards the Next Generation of Manufacturing. In: Mitsuishi M., Ueda K., Kimura F. (eds) Manufacturing Systems and Technologies for the New Frontier. Springer, London

PDF Files

Smart Manufacturing Leadership Council
Building the Science of Manufacturing Enterprise, 2011

Smart Process Manufacturing
(More files on this site)

Smart Factory - Mobile Computing

Factory of Tomorrow will be Smart - Intel

Updated 2018 - 20 May 2018,   22 February, 8 January 2018,
12 December 2017, 12  July  2017

Monday, May 14, 2018

Technology and Productivity - Role of Industrial Engineering


Organisation of Markets
Authors: Jan De Loecker (Princeton), Allan Collard-Wexler (Duke University)

The productivity impact of new technology: evidence from the US steel industry

The introduction of new production processes can have dramatic effects on aggregate productivity within an industry.

When we evaluate the impact of a drastic technological change on aggregate productivity growth, we control for other potential drivers of productivity growth, including international competition, geography, and firm-level factors such as organization and management.


By Steven Globerman
Western Washington University
Occasional Paper Number 23
 May 2000$file/op23e.pdf


The Effect Of Technology Use On Productivity Growth

Robert H. Mcguckin , Mary L. Streitwieser  & Mark Doms
Journal - Economics of Innovation and New Technology
Volume 7, 1998 - Issue 1
Pages 1-26

We find that establishments that use advanced technologies exhibit higher productivity. This relationship is observed in both 1988 and 1993 even after accounting for other important factors associated with productivity: size, age, capital intensity, labor skill mix, and other controls for plant characteristics such as industry and region.

The Impact Of Technology Adoption On Firm Productivity
Myung Joong Kwon  & Paul Stoneman
Economics of Innovation and New Technology
Volume 3, 1995 - Issue 3-4, Pages 219-234

Three versions of the model relating productivity and technology adoption with varying degrees of endogeneity are developed and then tested upon a data set relating to the adoption of five different process technologies by 217 firms in the UK engineering industry over the period 1981–1990. All the results indicate that technology adoption has a positive impact on output and productivity.


Tweeddale J.W - Technology and Productivity

Tweeddale J.W. (1982) Productivity Enhancement: An Approach to Managing Beneficial Change in a Military-Industrial Work Setting. In: Mensch G., Niehaus R.J. (eds) Work, Organizations, and Technological Change. NATO Conference Series (II Systems Science), vol 11. Springer, Boston, MA  Page 259

Created in 1978, as a reflection of growing management concern,
The Navy's Productivity Program was created in 1978 as management identified productivity enhancement as a key performance area, The program establishes the framework for improvement.
A network of productivity principals has been established in higher echelon Navy and Marine Corps commands with a Director of Productivity Management located in the Navy Secretariat.

The Navy Productivity Program, as presently structured, explores three major areas of opportunity. These are technological advancement, organizational development and process management.


Productivity improvements derive from changes in production methods, materials and machinery which "in turn stem from the accumulation of scientific and technological knowledge. The technology factor has been credited with at least 40 percent of the growth in productivity over the past five decades of domestic industrial experience.

The thoughtful integration of  productivity-beneficial technology to the Navy's industrial base represents a critical dimension of the Productivity Enhancement Program. This process requires enhancement of the capacity of the organization to accommodate innovation and to handle uncertainty.

To create a climate which encourages technological venture and innovation, a number of funding mechanisms have been introduced.

Cost of Ownership Reduction Investment (COORI) Program

Established as a part of the Navy's FY-82 budget planning, this program creates a funding base to support high payback capital investment opportunities. Candidate projects are placed in competition
by operating managers during budget planning (approximately two years before budget approval).

Fast Payback Program

The Fast Payback Program is designed to create a funding mechanism through which managers can fund high payback projects with short lead time provided the projects satisfy the following criteria:
1. The project costs less than $300,000 ($100,000 non-NIF).
2. The project has a payback of less than three years (two years non-NIF).

Funds are made available to support the Fast Payback Program through two funding mechanisms. These are:

Naval Industrial Fund NIF. Naval Shipyards, Air Rework
Facilities NARFs, Public Works Centers (PWCs) are among many of the Navy's industrial organizations which are NIF funded. Under this funding concept, "earnings" are credited to an industrially funded activity by charging fleet customers for goods and services

Procurement Funds - A productivity fund is created in procurement funds to take care of non-NIF activities.

Manufacturing Technology Program

This program explores the application of emerging technology (1) to reduce procurement and life cycle costs and (2) to increase productivity of existing assets.

Office of the Secreatary of Defense (OSD) Sponsored Productivity Enhancing Capital Investment (PECI) Program

1. Min investment $1 million.
2. At least 50 percent of the ROI has to come from Labor savings.
3. Payback period - max 4 years.
4. IRR - min 10%

The above is a good description of project schemes for encouraging project that promise productivity improvement.

Updated  15 May 2018, 28 November 2017

Sunday, May 13, 2018

Pilot Plant Industrial Engineering and Productivity Improvement

Industrial Engineers have to improve productivity in all engineering processes of all branches of engineering.

Pilot Plant Industrial Engineering for Productivity Improvement

Industrial has to work with product designers and do cost reduction and productivity improvement of new products at the design stage. They have to work with process developers to ensure the most productivity process at that stage. They need to work with pilot plant designers and developers to see that capital equipment decisions are rational and optimal. Then they have to observe the pilot plant processes and operator methods and motions to improve productivity based on actual work in the pilot plant. Industrial engineering done during the design, development, installation and operation of pilot plants can be termed pilot plant industrial engineering and it will be a very valuable service to industrial organizations and development of industry offered by industrial engineering discipline and profession.

Importance of Pilot and Demonstration Plants for Large Production Facilities
12 February 2018Mandar Deshmukh

Process Engineering for Scale-Up of Specialty Chemicals

 Xerox Research Centre of Canada (XRCC)

Scale-up of  chemicals encompasses various design methods through which a small lab process (typically at a gram scale) is enlarged to a large-scale process. The main objectives of scale-up activity at the Xerox Research Centre of Canada (XRCC) are:
 i) preparation of large quantities (typically 1000x lab scale) of materials having the same or similar chemical and physical properties of the material made at the small scale, and
ii) delivery of a manufacturing-ready process.

A reduction in unit manufacturing cost and improved quality are usually required and achieved on scale-up. Potential environmental and safety issues are adequately addressed at the engineering bench, before the process is scaled-up to the Pilot Plant. Process engineering plays a vital role in assuring an economical, robust, safe and environmentally friendly process for scale-up to manufacturing.

LGC Process and System Engineering

LGC briefly
A joint research unit…

The LGC is a chemical engineering research centre located in Toulouse
It is a joint research unit (UMR5503) bringing together:

The National Centre of Scientific Research (CNRS),
The Institut National Polytechnique (INP)
and the Université Paul Sabatier (UPS)
…and organised into 6 research departments …

One of them is Process and System Engineering

Home > Research at LGC > PSE - Process and System Engineering

Area of action
- Development and integration of generic models and concepts for the prediction of process or system performance
- Experimental validation phase for systems that physically exist.
- Improvement of the efficiency of numerical processes to solve problems by a large range of linear and discrete variables linked by non-linear equations that can present combinatorial properties.

Chief Productivity Officer - Value Addition of the Organizational Role and Position


The chief productivity officer
William A. Ruch  William B. Werther Jr.
National Productivity Review, Autumn (Fall) 1985

David Toh, Chief Productivity Officer at Singapore Manufacturers' Federation, 2010 to 2012
David Toh  is Principal Consultant at Fore Consulting in 2018

Oct 26, 2012
As it declared  big ambitions in productivity improvement (cutting $10bn from costs and $1bn from marketing spending) P&G is a fascinating case study to follow.

Patrick P.Poljan worked as Chief Productivity Officer at SABIC Innovative Plastics


CEO should become the chief productivity officer. - Ngiam Tong Dow, Retired high-powered civil servant, Singapore

Cloud computing is not just transforming how we get work done, it’s transforming the role of the CIO. In fact, that CIOs may want to begin 2016 by updating their LinkedIn profiles to include a new business title that reflects their primary responsibility: “Chief Productivity Officer.”

Introducing the Chief Productivity Officer

Say hello to the 'chief productivity officer'

What might future jobs look like?
Chief Productivity Officer: Using big data, these professionals will help companies become more productive while focusing their energy on the most impactful areas.

6 Reasons Your Company Needs a Chief Productivity Officer
Readily available technology can vastly increase productivity but to realize the potential you might have to make it somebody's job.

How Diageo’s Productivity Officer plans to save £500m by 2019
Brian Franz, Chief Productivity Officer (CPO) at Diageo, discussesd the transition from CIO to CPO.
He became Chief Productivity Officer (CPO) at Diageo in August 2015 and is using his many years of experience as a blue-chip CIO to drive true business change at the beverages company.

Your IT Manager is now your Chief Productivity Officer

Philippe Cochet, VP & Chief Productivity Officer, General Electric (GE)


HCM Strategist - Chief Productivity Officer
Going forward, perhaps we should advocate for a title change as the HR practitioner role becomes an increasingly strategic function – an ad-hoc combination of Chief Culture Officer, Chief Talent Architect, and Chief Productivity Officer mashed into a new role I call “HCM Strategist.”

HR’s new role could be as the Chief Productivity Officer - Josh Bersin at HRD18

SVP Research & Development, Chief Productivity Officer

When it comes to meeting deadlines and maintaining the highest standards of quality with large projects, Thermal Systems relies on Patrice Williams. Our systems have to meet our customers expectations, and be installed in a way that keeps the price affordable. This takes incredible planning and attention to detail. Patrice focuses her time on meeting equally with our customers and our installation team.

Wednesday, May 9, 2018

Productivity IoT Engineering

Using IoT technology and systems to improve productivity of engineering and engineering related products and processes.


May 2018

Prediction, prevention and improvement with IoT at Flex

At Flex, IoT is everywhere because we’re constantly looking at places where we can add instrumentation and analytics to our processes and products to achieve more consistent and better outcomes.

Manpower Productivity Improvement Using IoT

Illustrations from Singapore Companies of replacing manpower with IoT enabled systems and devices

Symphony Group uses drones and IoT to count cars in its inventory. It used to take the company 50 man-hours to complete the count, but now it estimates to complete it within the hour using  a single technician.

HOPE Technik tackled  the challenge of carrying heavy loads for many industries by developing AGVs.The SESTO AGV is a robotic product and it functions flexibly in any facility. The AGVs do not require embedded lines or magnetic strips on the ground. SESTO AGV system has a payload ranging from 200 kilogrammes to 2 tonnes. Equipped with a laser-based navigation system and intelligent planning capability, the driverless  autonomous system functions without requiring any modifications to an existing environment.

The AGVs are deployed in a hospital, replacing four personnel to transport lab samples to lab technicians. The system handled over 500 deliveries per 12-hour shift and freed up the manpower.

In a semiconductor plant, five  SESTO AGVs helped take over the duties of twenty personnel, who previously transported work-in-progress materials between processes. This system handles 12,000 deliveries per 12-hour shift.

 AiTreat  is developing a Massage Assistive Robotic System (MARS) to help to help  the Traditional Chinese Massage practitioner serve two to five persons using robots to find massage needs and do massage with the massage plan created by the experienced practitioner. Thus it provides  direct labour productivity increase of 200-500 percent. MARS will have many different advanced sensors, like 3D, thermal, force/torque, distance, etc, to understand the points of tightness in the body and then provide the required massage at the required places.

The Internet of Manufacturing Things:

Advances in sensors, standards and software could connect virtually everything

By Thomas R. Cutler
Industrial and Systems Engineering at Work
August 2014    |    Volume: 46    |    Number: 8

 IoT can improve various aspects of manufacturing efficiency, including productivity, asset health, profitability, quality, safety, employee safety and environmental impact. The narrow slice of the Industrial Internet of Things that mostly affects industrial engineers is the Internet of Manufacturing Things.

The Internet of Manufacturing Things
12 April, 2017

Updated 10 May 2018, 20 September 2017

Monday, May 7, 2018

Modern Hand Tools and Power Tools - Productivity Potential

Excel Assembly Solutions for Power Tools


Rivet Tools

Automatic Rivit feeders for more productivity and higher safety
6 November 2017

Rivet Gun


Riveting in Practice


Saturday, May 5, 2018

Productivity Improvement Techniques and Industry 4.0 Technologies - Interface and Interation

David Sumanth gave a classification of productivity improvement techniques.

In this post, we are trying to create an interface for the prodcutivity improvement techniques and industry 4.0 technologies by identifying the combination that provide benefit either way or two-way. The productivity techniques benefits increase by combing the technique with Ind 4.0 technology, or the productivity of Ind 4.0 technology implementation will increase with implementing the productivity improvement technique. The effect can be mutual also.

The idea of the post is derived from

Lean Transformation Integrated with Industry 4.0 Implementation Methodology
Conference Paper · July 2017
Conference: Conference: GJCIE 2017-Global Joint Conference on Industrial Engineering and Its Application Areas, At Vienne, Austria

Lean Production Systems for Industry 4.0

Cellular Manufacturing - Data Analytics, Adaptive Robotics

Setup Time Reduction - Sensors, Auto-ID Technologies

Quality Control - Pattern Recognition, Data Analytics, Sensors

TPM - Data Analytics, Sensors, Augmented Reality

Production Smoothing - Data Analytics,

Kanban - Simplified Manufacturing Reorder Communication - Auto-ID Technologies, Sensors

WIP Reduction - Data Analytics, Sensors, M2M Communication

Supplier Development - IoT, Data Analytics

Jidoka - IoT, Sensors

CIM - M2M Communication, IoT, 3-D Printing, Sensors, Data Analytics, Adaptive Robotics

Method Study - Adaptation by Toyota Production System

Denis R. Towill, (2010) "Industrial engineering the Toyota Production System", Journal of Management History, Vol. 16 Issue: 3, pp.327-345,

Above paper by Towill describes how method study was adapted and used by Toyota executives in developing the globally accaimed World Class Manufacturing Model, Toyota Production System.

 The paper confirms there is a continuing role for well established method study techniques to be adapted to face new challenges, and output as “contemporary” industrial engineering.

 The paper supports the view that effective and efficient product delivery is best driven via sound industrial engineering expertise operating within an active learning organisation.

 Ohno remarked that Knowledge (and above all practice) in the use of the method study based waste elimination techniques should be a pre‐requisite skill for employees at all levels. This is a sometimes “hidden” secret of TPS, but dates back to Lillian Gilbreth in 1914.

 TPS has evolved over an extended period of time to achieve continuous material flow. There has been no single procedure or technical breakthrough. Much of the detail would have been familiar to the Gilbreths. However the scenario of the current TPS enterprise would be new to the Gilbreths. Similarly the various ways in which the systems approach has been successfully implemented throughout the organisation would appear strange.

The purpose of this paper is to examine the manifold linkages connecting the Toyota Production System (TPS) back to the Gilbreths and others, and to determine how these have contributed to enterprise‐wide best practice.

Description of the Japanese Management Association (JMA) personal handshake route originated by Frank Gilbreth in which experiences were handed down in lecture note format by successive generations of industrial engineers is given in the paper. The internationally recognised “softer” approach to teaching and coaching due to Lillian Gilbreth is then discussed. Finally the Gilbreth MOI2 Process Chart is examined.

Toyota Production System
A production system which is steeped in the philosophy of "the complete elimination of all waste" imbuing all aspects of production in pursuit of the most efficient methods.

Accessed on 5 May 2018

Toyota Motor Corporation's vehicle production system has been established based on many years of continuous improvements, with the objective of "making the vehicles ordered by customers in the quickest and most efficient way, in order to deliver the vehicles as quickly as possible."

The Toyota Production System (TPS) was established based on two concepts:

The first is called "jidoka" (which can be loosely translated as "automation with a human touch") which means that when a problem occurs, the equipment stops immediately, preventing defective products from being produced;

The second is the concept of "Just-in-Time," in which each process produces only what is needed by the next process in a continuous flow.

Based on the basic philosophies of jidoka and Just-in-Time, the TPS can efficiently and quickly produce vehicles of sound quality, one at a time, that fully satisfy customer requirements.


Human Touch of the Machine

— Highlighting/visualization of problems —
-Quality must be built in during the manufacturing process!-

If equipment malfunction or a defective part is discovered, the affected machine automatically stops, and operators cease production and correct the problem.

For the Just-in-Time system to function, all of the parts that are made and supplied must meet predetermined quality standards. This is achieved through jidoka.

Jidoka means that a machine safely stops when the normal processing is completed. It also means that, should a quality / equipment problem arise, the machine detects the problem on its own and stops, preventing defective products from being produced. As a result, only products satisfying quality standards will be passed on to the following processes on the production line.

Since a machine automatically stops when processing is completed or when a problem arises and is communicated via the "andon" (problem display board), operators can confidently continue performing work at another machine, as well as easily identify the problem's cause to prevent its recurrence. This means that each operator can be in charge of many machines, resulting in higher productivity, while continuous improvements lead to greater processing capacity.


Make only when needed

— Productivity improvement —
- Making only "what is needed, when it is needed, and in the amount needed!"

Producing quality products efficiently through the complete elimination of waste, inconsistencies, and unreasonable requirements on the production line.

In order to deliver a vehicle ordered by a customer as quickly as possible, the vehicle is efficiently built within the shortest possible period of time by adhering to the following:

When a vehicle order is received, a production instruction must be issued to the beginning of the vehicle production line as soon as possible.

The assembly line must be stocked with required number of all needed parts so that any type of ordered vehicle can be assembled.

The assembly line must replace the parts used by retrieving the same number of parts from the parts-producing process (the preceding process).

The preceding process must be stocked with small numbers of all types of parts and produce only the numbers of parts that were retrieved by an operator from the next process.

Process Waste Visualization Chart

Process waste elimination is an important objective of scientific management and industrial engineering disciplines. Frank Gilbreth proposed process charts to visualize and improve processes.

Taiichi Ohno and Shigeo Shingo combination brought of the 7-Waste Model and created a strong focus on identifying and eliminating waste.

The 7-Waste Model was further extended by others in more wastes. The flow process chart with five symbols can be further developed to identify more wastes and operationalized the extended 7-Waste Model.

The visualization chart can be record the follow events, flows or quantities

Transport of material
Movement of Operator
Set up of Machine
Uploading material
Batch quantity
Processing or Operation
Unloading material
Defects or Rejections
Temporary delays
Idle time of machine
Idle time of operator

What more needs to be added?

Related Articles

Seven Wastes Model

Process Analysis - Questions/Check List

Process Improvement Study Progress Chart

Value Stream Mapping - Origins

The Seven Types of Waste (Muda) – Now with 24 More Types of Waste
March 8, 2015

Improving Lean Design of Production Systems by Visualization Support
Volume 41, 2016, Pages 602-607
open access

Friday, May 4, 2018

Lean Manufacturing - World Class Manufacturing - Bibliography

Chapter - Lean Manufacturing: Recent Trends, Research & Development and Education Perspectivies
S. Vinodh and R. Ben Ruben

In:   Research Advances in Industrial Engineering
J. Paulo Davim
Springer, 04-May-2015 - Technology & Engineering - 118 pages

This book provides discussions and the exchange of information on principles, strategies, models, techniques, methodologies and applications of industrial engineering. It communicates the latest developments and research activity on industrial engineering and is useful for all those interested in the technological challenges in the field.

See the preface in 
The first sentence is:  "Industrial engineering is the branch of engineering that is concerned with "increasing productivity through the management of people, methods of business organization and technology" or in other words, "industrial engineering is human effort engineering and system efficiency engineering"". 

Definition "Industrial engineering is human effort engineering and system efficiency engineering" was given by Narayana Rao K.V.S.S., Professor, National Institute of Industrial Engineering, Mumbai, India.

Prof. Rao developed and presented Principles of Industrial Engineering.

Lean Manufacturing - YouTube Video Play List


Ian Johnson

Online Material maintained by Dr. Chao-Hsien Chu

Mail your comments and suggestions to:
 Framework for Achieving World Class Manufacturing.
 Awareness Revolution.
 5S: Fundations for Continuous Improvement.
 Visual Control.
 Modeling for JIT Production.
 Design of Manufacturing Cells.
 Balancing / Sequencing Mixed-Model Lines.
 SMED: Setup Reduction.


WCM by Yamashina - Resources

updated on  5 May 2018,  11 July 2017, 3 December 2013