NIÑA THERESA L.

RAGAY MBA 09-SUMMER CLASS 2020

WEEK 4 DISCUSSION 3
Discussion topic (Reference: Video on Role of Visual Control Aids in Productivity Improvement Part 2)
 A lot of effort in today’s organizations goes towards addressing the vexing problem of productivity
improvement. Do you have specific insights and wisdom that can benefit the other learners? Use this
forum to share your experiences in this journey of productivity improvement in your organization.
We will be happy to learn from these.

The basic structure of productivity improvement

Alan Lawlor suggests four general stages of any productivity improvement process:

(a) Recognition: We have to recognize the need for change and improvement.

(b) Decision: After convincing ourselves that we should improve, a decision must be made to act.

(c) Permission: There must be opportunities to implement decisions.

(d) Action: Actually implementing plans for productivity improvement, which should be the ultimate
objective.

Guidelines for a good strategic approach were given by Stephen Moss as follows:

Translate competitive requirements into specific goals for operations in the light of the present and
potential operating strengths and weaknesses of the company and its competitors.

Review and rethink the entire operating system from product design through service after sale. Consider
the full range of inputs, and do not be constrained by conventional wisdom, always keep in mind the
interdependencies within the system.

Assume ongoing change is both inevitable and desirable. New technologies become available, market
requirements and resources change, and competitors act and react. Therefore, the system must be
innovative and flexible so it can improve and adapt continually.

Thus, productivity strategy is the pattern of decisions in the enterprise that determine its objectives,
procedures and principal policies and plans for achieving long-term productivity improvement goals. A
good productivity improvement strategy should, as a minimum:

- develop a clear and easily communicated definition of the productivity improvement concept;
- explain why organizational improvement is important;
- evaluate current operating status and the reasons for the current status;
- develop models of excellence;
- develop improvement policies and plans.
The 5 rules of productivity improvement

Based on the site, https://better-operations.com/2017/03/06/productivity-improvement-five-rules/, it has

five universal rules of productivity improvement:

Rule 1. Deliver value for the customer

First—and too often misunderstood—do the right things before doing the things right! Effectiveness
comes before efficiency. This means to start with a focus on creating value for the customer. Another
word that captures this notion is in my opinion the good old “quality”, in the broad meaning of the word.
Quality can be defined as conformance to customer requirements.

Rule 2.  Get processes under control

Do not overload processes, equipment or people. Reduce “muri”, as they say in Toyota. Queuing theory
gives mathematical proof that, when utilization gets closer to 100 %, chaos grows exponentially. If the
key to the first principle is quality, the key to this principle is a deep respect for your resources – first and
foremost respect for people. Technology is a great means to get processes under control. Digitalization
and automation is here to help, but make sure your maintenance practices are robust. A good tip is to start
focusing on the bottleneck processes in your operations.

Rule 3. Sync processes as a system

The third rule is to sync processes. It requires a system perspective. We know that variation (“mura”)  is
one of the biggest enemies of productivity and should be sought reduced. However, we must differentiate
between strategic and dysfunctional variation. It is only the dysfunctional variety that should be sought
eliminated. The strategic variation gives competitive edge and should be kept or cultivated.
Many practical techniques help sync the processes, including assembly lines, standardization,
modularization, takt time-paced production and just-in-time logistics, to mention a few.

Rule 4. Shorten throughput times

For productivity, fast flow is an ideal— but not on the expense of any of the three first rules! A good way
to make throughput times and lead-times shorter is to reduce non-value adding activities in and between
all processes, so called waste (“muda”).

Rule 5. Continuously improve

There are two good reasons for seeking continuous improvement. First, because systems never get
perfect, there is always room for increasing productivity in your processes. Second, the external
environment is constantly changing. Improvements range from incremental process improvements
(exploitation) to more radical technological and organizational innovations (exploration). Building a
learning organization, capable of both exploration and exploitation, is the most certain way to sustain and
improve productivity over the long run.