Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc.,

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Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-1 Operations Management Work Measurement Supplement 10

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-2 Outline  LABOR STANDARDS AND WORK MEASUREMENT  HISTORICAL EXPERIENCE  TIME-STUDIES  PREDETERMINED TIME STANDARDS  WORK SAMPLING

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-3 Learning Objectives When you complete this supplement, you should be able to : Identify or Define :  Four ways of establishing labor standards Describe or Explain :  Requirements for good labor standards  Time study  Predetermined time standards  Work sampling

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-4  Costing labor content of products  Planning staffing needs  Estimating time and cost for bids  Planning production (crew size and work balance)  Estimating expected production  Basing wage-incentive plans  Determining employee efficiency Uses of Labor Standards

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-5  Historical experience  Time studies  Predetermined time standards (MTM)  Work sampling © 1995 Corel Corp. Sources of Labor Standards

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-6 Historical Experience  Relatively easy, convenient, and inexpensive  Not objective, unknown accuracy Not recommended

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-7  Labor standards are based on observing worker doing task  Observe only a sample of work  Use average time & pace to set standard  Disadvantages  Requires a trained & experienced analyst  Standard cannot be set before task is performed Time Studies

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-8 The Eight Steps to Conducting a Time Study ÊDefine the task to be studied (after a methods analysis) ËBreak down the task into precise elements ÌDecide how many times each element of the task must be measured ÍRecord the times and ratings of performance for the task elements  Compute the average observed cycle time (element times adjusted for unusual influences)

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S Compute the normal time for each task element: Normal time = (Average actual cycle time) x (Rating factor) 7.Sum the normal times for each element to develop a total normal time for the task 8.Compute the standard time: The Eight Steps to Conducting a Time Study - continued Standard time = Total normal time 1- Allowance factor

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-10 Allowances  Personal time allowance - 4% - 7% of total time - use of restroom, water fountain, etc.  Delay allowance - based upon actual delays that occur  Fatigue allowance - to compensate for physical or mental strain, noise level, tediousness, heat and humidity, assumption of an abnormal position, etc.

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-11 Rest Allowances (%) for Various Classes of Work 1. Constant allowance (a) Personal allowance ……………... (b) Basic fatigue allowance ………… 2.Variable allowances: (A) Standing allowance …………….. (B) Abnormal position (I) Awkward (bending) …………. (ii) Very awkward (lying, stretching) …………………….. (C) Use of force or muscular energy in lifting, pulling, pushing Weight lifted (pounds) 20 ………………………………… 40…………………………………. 60…………………………………

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-12 Rest Allowances (%) for Various Classes of Work - Continue (D) Bad light ( i) Well below recommended ….. (ii) Quite inadequate ……………. (E) Atmospheric conditions (heat and humidity) Variable ………………………….. (F) Close attention (i) Fine or exacting ……………… (ii)Very fine or very exacting …... (G) Noise level (i) Intermittent – loud …………… (ii) Intermittent – very loud or high-pitched

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-13 Rest Allowances (%) for Various Classes of Work - Continue (H) Mental strain (i) Complex or wide span of attention ……………………… (ii) Very complex ……………. (I) Tediousness (i) Tedious ……………………. (ii) Very tedious ……………… 4 2 5

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-14 Time Studies - Sample Size h = accuracy level desired as percent of job element, expressed as a decimal (5% = 0.05) z = number of standard deviations required for the desired level of confidence s = standard deviation of the initial sample x = mean of the initial sample

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-15 Considerations in Determining Sample Size ¶ How accurate do you want to be? · What level of confidence do you want your measurements to have? ¸ How much variation exists within the job elements?

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-16 Common z values

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-17 Allowance factor Nonwork time Total time Average element time  Element times Number of cycles Normal timeAverage element time * Perf. Rating Standard time Total normal time 1 - Allowance factor = = = = Time Study Equations

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-18  Labor standards are set from times in published tables (e.g., MTM Table)  Procedure  Divide manual work into basic elements  Look up basic element times in table; sum  Advantages  Times established in laboratory setting  Useful for planning tasks  Widely accepted by unions Predetermined Time Standards

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-19 Time TMU Hand in Motion Distance Moved (in) ABCAB 3/4 or less A Reach to object in fixed location. B Reach to object in variable locations. C Reach to object jumbled with others. 1 TMU =.0006 minutes MTM Table for Reach Motion

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-20 Sample MTM Table for GET and PLACE Motions

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-21 MTM-HC Analysis: Pouring Tube Specimen Element DescriptionElementTime Get tube from rackAA235 Get stopper, place on counter AA235 Get centrifuge tube, place at sample tube AD245 Pour (3 sec.)PT83 Place tubes in rack (simo)PC *238=Total standard minutes = 0.14 Total TMU 238

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-22  Labor standard is set using output and % of time worker spends on tasks  Involves observing worker at random times over a long period  Advantages  Less expensive than time studies  Observer requires little training  Disadvantages  Ineffective with short cycles Work Sampling

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-23  Used for  Ratio delay studies  Setting labor standards  Measuring worker performance Work Sampling

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-24 The Five Step Work Sampling Procedure 1.Take a preliminary sample to obtain an estimate of the parameter value 2.Compute the sample size required 3.Prepare a schedule for observing the worker at appropriate times 4.Observe and record worker activities; rate worker performance 5.Determine how workers spend their time (usually as a percent)

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-25 Work Sampling - Sample Size p = estimated value of sample proportion (of time worker is observed busy or idle) h = accuracy level desired in percent, expressed as a decimal

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-26 Normal Time = (Total Time) (% of time working) (Rating) Number of units Produced Standard Time = Normal Time 1 - Allowance Work Sampling Equations

Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J S10-27 Work Sampling Time Studies