CHAPTER1

Industrial Engineering and

Production Systems

1.1 INTRODUCTIONN
Industrial engineering determines the most effective
ways to use the basic factors of production
such as men, machines, materials, information, and energy to make a product or a service. These
factors of production form the link between management
goals and operational performance.
Industrial engineering deals with increasing productivity through the management of men,
methods and technology.
The American Institute of Industrial Engineering (AIIE, 1955) has defined the term
industrial engineering' as given below (Maynard 1963):
Industrial Engineering is concerned with the design,
improvemen and installation «
integrated systems of men, machines, materials, and energy. It draws upon specialized
knowledge and skills in the mathematical, physical and social sciences together with
the principles and method of engineering analysis and design to specify, predict, and
evaluate the results to be obtained from such systems.
A number of definitions have been given for industrial engineering. One more widely uscd and
accepted definition of industrial engineering is given below:
Industrial enginecring may be defined as the art of utilizing scientific principles,
psychological data, and physiological information for designing, improving, and
integrating industrial, management, and human operating procedures. (Nadler 1955)
Industrial management is closely related to industrial engineering and concerned with the
techniques to develop, improve, implement and evaluate the integrated systems ofmen,materials
and energy. It includes the knowledge of
money, machines, methods, knowledge, information
various fields to increase the efficiency and effectiveness of an industry. The origin of industrial
management has been industrial engineering. It is a process of planning, organizing, directing,
controlling and managing the activities of any industry/organization. It organizes and transforms
the inputs using various resources of the organization into value-added products in a controlled
and an effective manner.
 Engimeening and
Managemenl Industrial Engineering and Production Systens 3
Industnal
2

CONCEPTS IN
OF
D E V E L O P M E N T

M A N A G E M E N T
Fredrick Winslow Taylor (Popularly known as F. W. Taylor) is considcred the Father of
HISTORICAL
AND
1.2 ENGINEERING
Scientific Management. His ideas influenced by Adam Smith's book The Wealth of Nations,
INDUSTRIAL difèrent stages. These s t ages
on.
are
engineering
has been
defincd in five published in 1776; Thomas Malthus's Population Theory, published in 1798; David Ricardo's
evvlution of industrial Principles of Political Economy and Taxation, published in 1817; John Stuart Mill's Principles
The
mentioned below as: of Political Economy, published in 1848; and Charles W. Babbage's book on the Economy of
Pre-Industrial
Revolution Em Machinery and Manufacturers, published in 1832.
Phase 1: Era Taylor's four principles are enumerated as follows (Taylor 1911):
Revolution
2: Industrial
Phase Phasc
Scientific Management Phase . Replace working by "rule of thumb, use the scientific method to study a work and
Phase 3: Quantitative Management
Research and (Modern Management)
Phase 4: Operations Manutacturing determine the most efficient way to perform specific tasks.
Computer-Integrated
and
Phase 5:
Automation 2. Job specialization, i.e. rather than simply assign workers to do any job, match worker's
capability and motivation to their jobs, and train them to work at maximum efficiency.
Revolution Era
Pre-industrial
1.2.1 manual operat Monitor worker performance, and provide instructions and supervision to ensure that
there was focus on only
Industrial Revolution in the early 1800s, handicraft and agricula they, are using the most efficient ways of working
Prior to the concept; mostly, ture
activities. There was no factory this era are give 4 Allocate the work between managers and workers so that the managers spend their time
manufacturing Three major developments in given
ctc. were
dominated in the trade. on management, allowing the workers to perform their tasks efficiently.
products,
below as: Second major contributions in the field of scientific management are from Gilbreth family
1774: James Watt developed the steam engine. and advocated the concept of division of
(Frank B. Gilbreth and his wife, Lillian Gilbreth). Frank B. Gilbreth focused on identification,
1776: Adam Smith
wTote 7he Nations
Wealh of analysis, measurement and setting standards for the fundamental motions, which were required
etc. (Smith 1776).
labour, skill development, specialization, and used in
to accomplish a job. His contributions were appreciated to set the standard time and method to
developed by whitney was

Concept of interchangeability of parts

was
1798:
perform a task. Lillian Gilbreth worked on a human relation aspect of engineering.
(Hatfield 2013). Another major contribution also came from Henry L. Gantt. He provided the concept of
manufacturing ofmusket
planning and scheduling the activities on a graphical chart, widely knowm as Gantt Chart. This is
1.2.2 Industrial Revolution very helpful in reviewing the progress and updating the schedule of work.
the Industrial Revolution. This was due to The major development ofindustrial engineering was emerged during the period 1920-1940.
Industrial engineering emerged as a profession during In 1924, W.A. Shewhart developed the concept of Statistical Control Chart to measure the quality.
and skilled people, who were needed to plan, organize
the requirement of technically qualified During this period, concepts of inventory control, incentive plans, material handling, plant layout,
manufacturing processes. After the industrial
revolution, Taylor and Gilbreth
and control the
contributed a lot to the field of industrial etc. were evolved. Ralph M. Barnes worked on motion study for his doctoral work.
(Frank B. Gilbreth and his wife, Lillian Gilbreth)
known the base of Scientific Management.
engineering and later these contributions were
as
1.2.4 Operations Research and Quantitative Phase
1.2.3 Scientific Management During World War II, concepts of Operations Research were developed and used to optimize the

Following contributions, as mentioned in chronological order, form a major part of Scientific resources allocated in the During this phase, the concept of linear programming (LP) was
war.

developed by Dantiz. Some of the major developments observed during this phase are mentionced
Management below as:
1910: F.WTaylor's Scientific Management
1956: First NC machine was developed.
1911: Gilbreth's Motion Study
1961: First time Robot was used.
1913: Gantt's Scheduling Chart
1965: Flexible automation was used.
1917: Harris Inventory Control
1924: Shewart's Statistical Control Chart 1.2.5 Automation and Computer-integrated Manufacturing Phase
1927-33: Elton Mayo's Motivation Theory
1932: Babbage Wage payment and Time Study During this phase, most of the automation and computer-integrated manufacturing concepts
1933: Bames Work Study were
implenmented in the industries. Concepts of lean manufacturing and Just-In-Time (JIT)
were developed in automobile industries (Toyota manufacturing system).
 and Management
Industrial Engineering
Industrial Enginering and Production Systems5

the Future
1.2.6 Factory of for various operat
be used
Robots will theSuch
highly
automated.
ctc. Most of ne
Factory of the
future will be
and unloading of jobs,
welding, painting,
manual Job-shop
as material
handling, loading
climinated.
production
wDr will be
Batch
1.3 PRODUCTION SYSTEMS production

But production imnl:

with quantity produced. the Mass
production is concerned with the transformation ofi3
Quantitativety, services. It is
concerncd production
andor through whno
activity ofproducing goods
value-addition process
production is a Continuous
In other words, process, some valu
the roquirod outputs.
finished goods. Al
cach stage ofthe productionphone, computer. core production
material is comverted into furniture, mobile
anre producing
added. Some examples of production i.e. raw materials,
conversion subsystems, ie
A production system
consists ofinputs, and outputs, ie n Volume of production
i.e. quality control and reliability, nished
and machine, control system, shown in Figure 1.1. There are a
are interrelated
to each other as Figure 1-2:Types of production systems
products. All these components that can be studied in detail in Chantor 110
number other subcomponents of
production systems
of this book.. feature of this production system is highly flexible. A job-shop comprises general-purpose
Production Planning and Control' in
machines aranged inEachdifferent departments. The process layout is most suitable for this type of
Raw
Value addition Finished
goods
production system.
in a certain sequence.
job requires uniquetechnical requirements and processing on machines
material subsystemns
Characteristics of Job-shop Production
Control
subsystems .Machines and methods employed are generic type as product changes are quite frequent.
2. Planning and control systems are flexible enough to deal with the frequent changes in
product designs
Figure 1-1: Production system of an organization Manpower is skilled enough (cross-functional) to deal with changing work conditions.
Schedules are actually not fixed predetermined in this system no definite data is
available on the product.
or as

Type of Production Systems

is usually high accurate plans and schedules do not exist.
On the bases of volume and variety of products, production systems can be classified as job 5.6. The
In-process inventory
cost is
as

product normally high because of high

material and labour costs
sbop production, batch production, mass production and continuous production. The first three 7.
production systems can be grouped as discrete ypes of production. These production systems Grouping of the machines is done on a functional basis (i.e. lathe section, milling
section, etc.)
are shown in Figure 1.2. 8. This system is highly flexible the management has
as to manufacture varying product
In discrete production systems, the production sct-up is changed regularly to accommodate
types.
the production of diferent products of dificrent designs and specifications, for example, auto, 9.
Material handling systems are aso highly fexible to meet changing product
electronics, textile industries, etc. In contimuous production systems, same product is produced
requirements.
continuously in the same sequence or operations, for example, petro-refinery, chemical and power
plants. In discrete type of production systems, the products may be produced in different shits, Advantages of Job-shop Production
but in continuous
type of production system, production continues to 24 hours without shifts. ,
. Most suitable for production of a varicty of products due to the use of general-purpose
1.3.1 Job-shop Production machines.
2. Opportunities for learning multiple skills ánd getting varied exposure to the workers.
Job-shop production is characterized by manufacturing of a large
quantities that are designed and produced as per variety of products in small 3. The full potential and skill of operators can be utilized.
specifications given by customers. The main 4. Importance to creativity and innovative ideas.
5 Industnal Engineeringand
Management
Industrial Engineeringand ProductionSystems

Production
Limitations of Job-shop of scale. Limitations of Batch Production
production and
lack ofeconomies
low volume of at all levels.
. Higher cost due to level of inventory
. Material handling is complex because of irregular and zigzag flows
cost due to higher 2. Production planning and control becomes complicated.
2. Higher inventory
planning is used. ddue to
A complicated production materials cannot
be avoided in the shon
shop 3. Work-in-process.inventory is higher compared to mass/continuous production.
movement of
men and
Unnecessary 4. Higher set-up costs due to frequent changes in the set-up.
application of functional layout.
1.3.3 Mass Production
1.3.2 Batch Production
the job passes through the functional
Manutacture of discrete components or assemblies in a very large volume is called mass
of production in which
Batch prmduction is a type a diflerent routing.
Batch production ie production. Machines are arranged, in a line according to the sequence of operations on the
and each batch may have
departments in batches, of a limited number
of products at regular product in product layout. Product and process standardization exists and all outputs follow the
and stocking
characterized by the manufacture same path.
intervals, awaiting sales.
Characteristics of Mass Production
Characteristics of Batch Production
1. Product and process sequences are standardized.
used.
1. Shorter production runs are 2. Special-purpose machines having higher production rate are used.
2. Flexible manufacturing is most suitable. Production volume is large.
of items in a batch and a
change in
3. Plant andmachinery set-up is used for production 4. Production cycle time is shorter compared to job-shop and batch production systems.
the next batch.
set-up may be required for processing 5. In-process inventory is low
4. Manufacturing lead time and cost of production are lower as compared to job-shop
6. Flow of materials, components and parts is continuous and without any backtracking.
production due to higher volume. 7. Material handling can be completely automatic.
5. As the final product is standard compared to job-shop production and manufactured in
Advantages of Mass Production
batches, economy of scale can be achieved up to some extent.
6. Machines are grouped on a functional basis similar to job-shop
the manufacturing. 1. It has high production rate with reduced cycle time.
7. Semi-automatic and special-purpose automatic machines are generally used to take Less skilled be
operators may employed.
advantage of the similarity among the products. Low in-process inventory is used.
8. Labours are multi-skilled and work upon diferent product batches. 4. Manufacturing cost per unit is low.
9. In-process inventory is usually high owing to the type of layout and material handling
Limitations of Mass Production
policies adopted.
10. Semi-automatic material handling systems are most appropriate in conjunction with the 1. Breakdown of one machine stops the entire production line.
semi-automatic machines. The line layout needs major change with changes in the product design, that is, the
11. Normally, production planning and control is dificult due to the odd size and the non- layout is less flexible.
repetitive nature of order. 3. Higher investment in production facilities is required.
Advantages of Batch Production 4. The cycle time is determined by the slowest operation.

There is better utilization of plant and

machinery compared to job-shop production. 1.3.4 Continuous Production
2. Batch production promotes functional
3. Cost per unit is lower as
specialization. Production facilities for continuous production are arranged as per a predetermined sequence
4.
compared tojob-shop production. of production operations from the first operation to the finished product. The items are made to
Investment is lower in plant and
5. Itis flexible
machinery. flow in a sequence of operations through material handling devices such as conveyors, transfer
enough to accommodate and process a number
6. Job satisfaction exists for of products. devices, etc. A highly rigid type of machine layout is used for continuous production.
operators.
 and Managemen
Industrial Engineering
Industrial Engineeringand Production Systems 9

Production
Characteristics of Continuous
the manufacturing facilities will have to be
and cquipment
is employrd. generalized depending upon the volume. Greater
Dodicated plant commonalities demand discrete
automated manufacturing, which results in high inventories, large
2. Material handling is fully predetermined
sequence of operations. manufacturing lead times and elaborate planning and control.
follows a
3. The production process identified w+th the
hnal product.
materials cannot be readily
Lead time: The lead time, more appropriately used in production system is delivery lead time
.Component
routine action. expected by the customers. It is another
S. Planning and scheduling
are a major influencing factor in the selection of a production
system. As a general rule, faster deliveries are expected by customers. The product, therefore, may
Production
Advantages of
Continuous
require to be produced to stock using principles of batch production/mass production. If customers
standardized. are ready to wait for the
Productand process sequences
are highly product, then the product may be produced to meet the order only.
. time.
with reduced cycle
2. The production rate is very high due to line balanei Eficiency: Eticiency measures the speed and the cost of the transformation process. Efficiency
than the other production systems ng.
utilization is higher will be higher for the products which are
3. Capaciny
for material handling, as it is completely automated. produced in mass. But for mass production of a product,
4. Manpower is not required line. greater demands are required. Therefore, depending upon the demand, product variety is to be
A person with limited
skills can be used on the production considered and the process which gives the best efficiency in terms of machine and mànpower
S.
6. The unit cost is lower due to the high volume of production. utilization will have to be selected.
Limitations of Continuous Production
number of products does not exist. 1.5 PRODUCTIVITY
Flexibility to accommodate and process
a
1.
lines.
2. Very high imvestment is required for setting fow Production and productivity are two diferent terms having diferent meanings. Higher production
3. Product differentiation is limited.
does not mean higher productivity, and vice versa. Production is related to the activity of
It is a process of converting inputs into some useful, value-added
producing g00ds services.
or
1.4 SELECTION OF PRODUCTION SYSTEMS products/services. Productivity is concened with how efectively the resources are utilized to
the
increase outputof production. The productivity can be improved by increasing the output for
Any manufacturing system cannot be an ideal system production of product considering all
for a same inputs or

basic factors
keeping constant output for deceased amount of inputs or increasing the output in
thefactors sinmutancously. The choice system ofthe on depends vaious factors, but greater proportion than the increase in inputs. Productivity may be calculated using the following
that infuence the selection of production system are specification of the final product and cost- formula:
effective production process. Other factors which determine the choice of the production system
are gnen below as:
Productivity= OutputInput
Efect of volumehariety: One of the major considerations in the selection of production system Productivityisrelates the efficient utilization
of input for producing goods
resources services.
or

is the volumevariety of the products. High product variety requires highly skilled labour, Production
of
a
measure of the output or volume produced. The emphasis is only volume
on

genera-purpose machines, detailed production planning and control system. On the other hand production and not on how well the inputs utilized. In contrast, productivity
or resources are

emphasizes only the ratio of the output produced to the inputs used: Productivity may be
on
low one or few products produced in large volumes) enables the use of
product variety (.e.
semi-skilled labour, highly automated production processes using special-purpose machines and
divided into two categories: partial productivity and totalproductivity.
simple production planning and control systems. The relationship between volume and variety of 1.5.1 Partial Productivity
products is already shown in Figure 1.2.
Partial productivity is the ratio of the total output and individual input in the case of multifactor
Capacity of the plant: The projected sales volume is a major infiluencing factor in determining productivity (MFP) (Solow 1957). This term is used to measure the productivity of an individual
whether the firm should go in for discrete/intermittent or continuous input such as manpower, capital invested and energy utilized in production. Partial productivity
process. Fixed costs are high
for continuous process and low for discrete
process while variable costs are more in the discrete is defined on the basis of the class of the input being considered. For example, if the labour
process and less for continuous process. Discrete process therefore will be was increased by 18 per cent during the last financial year, its effect on the increased output is
operate at low volumes and continuous process will be
cheaper to install and
to economical use at high volume. represented by partial productivity. Similarly, partial productivity of capital, material and other
Flexibility: Flexibility implies the ability of the company to meet inputs may be defined. The various components of partial productivity and their uses are shown
the market
the changes required in in Table 1.1.
regarding product design and volume. If more varieties be
are to manufacturcd,
 Management
10 IndustrialEngneeringand Industrial Engineering and Production Systems 11

productivity
1-1:Different forms of partial With increased order
Table
Formula
Partial productivny Output/Labour input
(a) When additional 20 workers are hired
1. Labour productivity Output/Material input Production= 44,000+6000=50,000 mobile phones
2. Material productihy Output'Capital input Productivity (of labour) = Increased total production/Total man-hours
3 Capital productivity Output/'Energy input 50,000/(200 +20) (8) (30)
4. Energy productity Output/Advertising and media
0.946 mobile phones/man-hour
5. Advertising and media planning planning input (b) When additional 25 workers are hired
productivity Output/Other expense input
6. Other expense productivity Production=44,000+6000 50,000 mobile phones
317 Productivity (of labour) = 50,000/(200+25) (8) (30)
Measure 0.925 mobile
Advantages of Partial Productivity
=
phones/man-hour
are required. (c) When additional 30 workers are hired
1. tisa good diagnostic measure identify areas where improvements
to
it is independent of other inputs. Production =44,000+6000= 50,000 mobile phones
2. Itis easy to calculate because
the logic for its improvement
3. The management finds it easy to understand and pinpoint Productivity (of Jabour)= s0,000/(200+30) (8) (30)
industries.
4. Itis easy to benchmark (compare) with other 0.905 mobile phones/man-hour
5. Data may be easily generated for it. In this example, it is clear that
production has increased by 6000 units. Therefore,
Limitations of Partial Productivity Measure Increase in production (50,000 44,000/44,000)x 100 13.6 per cent
=
=

1. It can be misleading if used out of context.

since it is concerned 1.5.2 Total Factor
2. It does not represent the overall effect of the system pertormance Productivity
only and not all the resources.
with the contribution of a specific input TFP is the ratio of net
3. Focused areas of improvements are difficult to identify. Therefore, sometimes wrong output to the sum of associated labour and capital inputs. Net output means
total output minus intermediate goods and services
areas of management control may be identified for improvement.
this ratio is made up of only the labour and
purchased. Notice that the denominator of
4. It gives a myopic view of the performance of production systems. This means, only capital input factors.
or performance, are considered.
limited factors, which affect the output Net output
Total factor productivity (TFP) =
5. It misses the holistic (or totality) approach. Total factor input
Total output -Materials and services purchased
Example 1.1: A mobile phone manufacturing company is producing 44,000 mobile phones
(Labour + Capital) Inputs
per month by employing 200 workers in 8-hour shift., The company gets an additional order to
supply 6000 mobile phones. The management has decided employ additional workers. What Total productivity =- Total output
will be production and productivity levels when the number of additional workers employed Total input
is: (a) 20 (b) 25 and (¢) 30.
Advantage of TFP
Solution (a) It is relatively easy to compare data from company records.
Present
production =
44,000 mobile phones (b) Industrialist prefers this as it is easy to compare in cross-industrial context.
Present productivity (of labour) = Present production (i.e., output) Limitations of TFP
Total worker hours (i.e., input)
a) Many important inputs, such as material, energy, etc., are ignored.
44,000 components (b) The net output does not reflect the efficiency of the production system in a proper way.
(200 workers)8 hours)(30 days of the month)
=
44,000/48,000 =
0.916 mobile phone/man-hour
 Management
12 Indstral Engineeningand
Industrial Engineeringand ProdudtionSystems 13
for a particular type
produced and inputs consumed to
data for output Fnd out the partial.
Example 1.2: The below in constant money value. Table 1-2: (Continued)
are given
manufactuning onganization
values. ems 2013 2014
factor and total productivity
Output= Rs 3000.00 Capital depreciation (Rs) 8000 11,000
Rs 600.00 Capital book value (Rs) 32,000 45,000
Labour input =

Matcrialinput Rs 300.00
= Total indrect cost (Rs) 48,000 56,000
input Rs S00.00 Energy used Rs 4/kW in kW
Capital =
5000 8000
Rs 150.00
Energy input materials used (Rs)
=
Raw 32,000 36,000
Other expenses input = Rs 75.00
Services of consultant hired (Rs) 20,000 25,000

Solution: Solution:
Partial productivities
Labour productivity =
Labour
Output-u
input 600
5 (a) Direct labour productivity index= 16,000/60,00100
10,000/32,000
= 85.33 per cent

Material productivity =
Output
Material input
300010
300 (6) Capital depreciation productivity index= 16,000/ x100
10,000/800o
Capital productivity = Output 3 . 7 5 = 109.09 per cent
Capital input 800

Output SU0 20
(c) Capital book value productivity index = 16,000/45,00010
10,000/32,000
Energy productivity= Energy input 150 = 113.77 per cent

Other expenses productivity= Other expenses input

Output 300040
75 (d) Total indirect cost productivity index =00U/0,000x100
10,000/48,000
Net output
Total factor productivity (TFP) =;Total factor input
= 137.14 per cent

()Energy productivity index =16,000/8000100 =100 per cent

Total output -Materials and services purchased 10,000/5000
(Labour+Capital) inputs
() Raw material productivity index =0,U00/56,000100
3000-(300+150+)1.76
600+800
10,000/32,000
= 142.22 per cent

Output
Total productivity=Tt
i3000 index=0,000/25,000
otal input 600+300+800+150+75. (g) Consultant productivity x100
10,000/20,000
= 128 per cent
Example 1.3: Table 1.2 gives the comparative study of several items of a motherboard for the
years 2013 and 2014. Compute the changes in all productivityindices Example 1.4: Using the information given in Table 1.3, calculate the index for thefollowing
Table 1-2: Comparative study of productivity for the years 2013 and 2014 (a) Direct labour productivity
(b) Capital depreciation productivity
tems (c) Capital book value productivity
te heo y2014
Number of output at the rate of Rs 5000 per unit (d) Direct cost productivity
10,000 16,000
Direct labour cost (Rs) (e) Total cost productivity
32,000 60,000
() Energy produetivity
(Continued)
 Industrial Engineering and Production Systems 15
Managment
Engineeny and
ndustril
14
2013
2012 and

stady of
prductivity
for the years
2012
2013 1 .5.4 Effectiveness and Productivity Index
13:Comparative

of the degrce accomplishment or achievement objective

of an
ne

250
300 The term 'effcctiveness'is a measure of for a patient. He could go
For example, a man rushes to the market to buy some medicines
Rem (targct). Now
kind) (n Rs) or on foot. The cost and time are
different for different modes of travel.
of outputs (al
of one
60,000 by a car, or by a bicycle
dies, then the effort is not cffective.
Number 50,000
(10000 per un)
5000 suppose by the time the
medicine is brought the patient
labour cost (in Rs)
4000
Effectiveness represents the degree of success in accomplishing objectives. Therefore,
Drect
16,000 24,000 of how well a of targets or results are accomplished.
set
(in Rs effectiveness indicates a measure
deprecaton combined eflect
Captal
44,000 e integration
is the of both efficiency and effectiveness. It indicates a
value (in Rs) 40,000 Productivity
Cantal book effectiveness). The combined effect of
700
2400 of resource utilization (i.e. efficiency) and performance (i.e.
cost (n Rs) index:.
Total indirect
and effectiveness is used in defining a term called productivity
Rs 4 per wat) (in k 12 16 o cfficiency
Energy used (G
materia used (0 Rs 1000 per ton)
(in tonnes) Performance achieved Productivity in current year
Raw
Productivity index = Input resources consumed Productivity in base year

Solution:
indcx =
Effectiveness
Cakulation of productivity Efficiency
300 , 100 100 per cent
(a) Direct labour productivity index 60,000 250
1.5.5 Productivity Cycle
3004000x100 planning, productivity
The productivity cycle consists of four phases: productivity target
productivity index In the first
=

5000 250 (see Fig. 1.3).

comparison, productivity improvement and productivity
depreciation measurement
b) Capital
various factors such as availability
target of productivity is to be fixed considering
= 96.0 per cent
phase, a
second phase, productivity is compared, with
of resources and the production demand. In the
3006,00100 80 per cent the productivity of competitor firms or the productivity
of other sections in the same firm. In
Capital book value productivity index94 000 250 highlighted and
(c) the third phase, the opportunities and scope of productivity improvement are

is measured in other terms like

used for improvement. Finally, in the fourth phase, productivity i.e.
productivity index
=
30040,U0x100 =
109.01 per cent
efficiency. Efficiency represents the system's ability produce very
to close to standard output,
(d) Direct cost
,000 250 But it is also used frequently as outputinput, mathematically.
output/standard output.

(c) Energy used productivity index

300
2400 x4
700x100
250
35 per cent
Productivity
improvement

index =
300 12,000100 = 90 per cent Productivity
(Raw material productivity 250 Productivity
6, 00 measurement comparison

1.5.3 Efficiency
It is the ratio of output
how well the resources
Productivity target
planning
indicates a measure of
to standard output expected. Therefore, efficiency
or result. Efficiency may be calculated Figure 1-3: Productivity cycle
are utilized to accomplish a target

using the following formula:

Efficiency = Output/Standard output /1.5.6 Factors Influencing the Productivity
e.g. for student 100 (full marks) is the standard There various factors that infiuence productivity of an organization, such as man,
output without loss,
are
Here standard output means a
of the
Man is of the important parts
machine, materials, space, energy, time and finance.
one
output and the marks obtained by him is simply output.
 Management
16 IndustialEngineeringand Industrial Engineering and Production Systems 17

the producti
The number of
cmployces, their skills and motivation affect
the productivity. To improun
production system. role in improving the 1.5.7 Reasons for Lower
of the system.
Machines play an important Similarly, the
third important compona Productivity
maintenance is required. There
machinc's availability, proper high-quality
material at low cost increa are various reasons of poor productivity. Some of them are mentioned as follows:
the productivity of theis system. The
material's time
cost quality. A in different processes such as inSneot:
and consumcd on
of production system ction,
utilizati
1. Poor production planning and control
system. Ina way, proper
similar
2. Low
affects the productivity of the
motivation of people
maintenance, production increases the productivity. 3. Lack of coordination
energy saving
and cffective use of money
of space, 4. Unavailability of right tools, material and human force
on the following processes 5. Poor product design
Man: The productivity of man depends
6. Lack of standardization
. Selection of an employee 7. Poor working environment
2. The training given to employees 8. Non-standard methods of working
Number of personnel required
for a job
9. No accountability for loss of production
4. Provision of incentive for workers 10. Government rules and regulations
machine depends on the following factors: 11. Old age of plant and equipments
Machine: The productivity of a
12. Weak R &D.
1. Number of machines employed
machines
2. Replacement policy for existing
breakdown 1.5.8 Ways to Improve Productivity
3. Maintenance plans to avoid machine
productivity of a material: The
Material: The following factors afect the productivity of any system can be improved either by proper use of resources or by effective
utilization of the system or its
processes. Some action plans for productivity improvement are
1. Right quality listed below:
2. Right quantity
3. Substinutes for the existing material Machine
4. Inspection and quality control programmes Manual labour is replaced by machines
5. Cost of material procurement and handling 2. Reliable machines
Time: It affects the productivity in the following ways: 3. Automation.

1. Inspection time for raw material Management

2. Inspection time for finished products 1. Motivated workforce
3. Production time 2. Better
4. The time required to repair and maintenance work
planning and coordination
3. Effective control over the system.
Space: Utilization of space affects the productivity in the following ways: Process
Plant layout 1.
2. The total area covered for production work
Computerization of the system
2. Use of Management Information
3. Location of differe departments and shops
System (MIS)
3. Improvement in scheduling
4. Better material flow
Energy: Use of energy affects the productivity in the following ways: 5. Fast and accurate retrieval of
1. Energy-saving schemes parts.
2. Use of renewable energy sources Work design
3. Use of solar energy 1.
Improved job design
Finance: Availability and efficient use of financial facilities affect the 2. Better work method
productivity. 3. On-job training.
 and
Management
Industrial Engineering and Production Systems 19
Engineering
Industnl
18

Economic Batch
Work cminnment 3. Material-based techniques: Material Requirement Planning (MRP),
Economic Order Quantity (EOQ), JIT and material handling.
and
illumination
Quantity (EBQ),
Better lighting time study, method
I. 4. Task-based techniques: Work simplification, work measurement,
Better ventilation
merit rating, job safety and production scheduling.
study, job analysis, job evaluation,
Safe workplace
management
(TQM). 5. Employee-based techniques: Incentive scheme, management by
objective, job
Total quality Total Quality Management
enlargement, job enrichment, recognition and punishment,
(TQM) and zero defects.
Pngramme
. Quality circle 1.5.10 Guidelines for Productivity Measurement Systems
2. Suggestion scheme

3. Incentive scheme
Productivity measurement is directly related to the productivity improvement programme.
characteristics.
Revise pay or policy. A good productivity measurement should have the following
4
1. It should be simple in calculation, meaningful, easy to understand and use, and provide
Technolog Electro-Chemical Machining (ECM), ete
1. Acquiring new technology
such as
Surlace-Mounting Technologv
(SMT
the status of productivity in the organization. perfect accuracy is an
assembly line, for example, realistic assessment as
2. Acquiring automated
2. It should be accurate enough to present a
unit. unreasonable expectation.
board assembly
for printed circuit such as omputer Numerical Control(CNO)
machines, 3. It should help in identifying the areas of low productivity so that productivity cfforts
3. Acquiring computer-controlled
Numerical Control (DNC).
can be applied to that area for improvement.
or Direct
Vehicle (AGV) for material transportation. 4. It should provide indices and information for comparison of performance for different
4 Using Automated Guided
periods.
Manufacturing straleg 5. t should provide indices and information for comparison of performance with other
the manufacturing system
from functional to a cellular layout if it is a batch similar organizations/operations.
. Changing
production unit.
framework in the
production unit.
6. It should provide the information on interrelationship of diferent subsystems.
2 Adopting stockless production stralegy and JIT 7. It should incorporate both tangible and intangible outputs and inputs to the system.
3. clean and environment-friendly (also termed as green-production
Keeping the workplace 8. The productivity measurement system
should be
hierarchical in nature,the productivity
at lower levels gives productivity of subsystem and the productivity of subsystems
system).
Opting for total change in the process/product or strategy if the system is not working translates into overall productivity, of the system.
9. It should facilitate to devise a reward or an incentive scheme for the workers.
properly (also known as Business Process Re-engineering or BPR).
10. It should lead to the participation and involvement of employees of various levels.
External emvironment 11. It should be economical and administratively easy to run the productivity measurement
. Better political stability system.
Boosting economy and purchasing capacity of buyers 12. It should be independent from the changes in monctary values and external disruptions.
Globalization and open market economy

1.5.9 The Technology used to Improve Productivity SUMMARY

I. Technology-based techniques: Computer-Aided Design (CAD), We have discussed basic concepts of industrial engineering and about the various phases of its
Design and Drafting (CADD), Computer-Aided Engineering Computer-Aided conceptual development. Four types of production systems, their characteristics, advantages and
Process Planning (CAPP), (CAE), Computer-Aided disadvantages have been discussed in detail. These production systems are job-order production,
Aided Instruction (CAI),
Computer-Aided Quality Control (CAQC), Compuler batch size production, mass production and continuous production. Total productivity and partial
Computer-Aided Manufacturing (CAM), robotics, Group
Technology (GT) and Total Productive Maintenance productivity have been explained with the help of some numerical illustrations. Finally, factors
2.
Product-based techniques: Reliability, simplification,(TPM).
and Research and standardization, diversification
affecting the productivity, the reason for poor productivity, methods to improve productivity have
Development (R & D). been outlined.
 Industrial Engi oduction Systems_ 23
Industrial Engineering
and Management
2U

20 and will
MULTIPLE-CHOICE QUESTIONS (c) Agile manufacturing automation system

affects productivity?
(d) All of the above
NOT a factor that 4?
.Which ofthe following is use of the
(6)
Internet 10. Which of the following is the correct formula for total factor pr
(a) design of the workspace
d) Bicycle Total output
()standardizingprocesses (a) Total factor productivity »

Total input
2. Which of these factors
afects productivity?
(a) methods and technology
(6) workers Total output-Materials andser
b) Total factor productivity =
(c) the management (d) all of the above (Labour + Capital) Inputs
assembled an average of 400
3. In an assembly operation at a furniture factory, employees
8 standor
Total output-(Labour+Capital)
(c)Total factor productivityMaterials
the labour productivity of this operation? and
dining chairs per 5-day week. What is
services purchased
(a) 80 chairsworkerday b) 40 chairsworker/day d) None of the above
c) 10 chairsworker/day () 70 chairs/worker/day
11. Which of the following is NOT the reason of poor productivity?
V4. Which formula correctly describes productivity? (a) Poor production planning and contro
(a) (Output-Input)Output (6) (laput-Output)/Input b) Low motivation of people
c ) Output Input () Input/output (c) Lack of coordination
5. Ameasure of productivity which refilects a combination of some or all of the (d) Social activities
resources used to obtain
a certain output is
12. Who is known the Father of Scientific
(a) labour productivity
as
Management?
6) machine productivity (a) F. W. Taylor b) E. B. Gilbreth
(c) multi-factor productivity
(d) materials productivity () Henry L. Gantt (d) W.A. Shewhart
6. Industrial engineering is concermed with the design, improvement and installation of 13. The of operations research evolved
systems of integrated concepts during
(a) men, machines, methods, a) Industrial revolution (b)World War I
materials, and energy.
(6) marketing, sales and (c) World War II (d) Gulf War 2001
promotion.
(c) finance and
accounting 14. Which of the following is the most flexible production system?
(d) product design and
development. (a) Job-shop production (b) batch production
. Which of the (c) mass production
following is NOT concermed with (d) continuous production
(a) F. W. Taylor's scientific
(c) Gantt 6) Gilbreth
management? 15. Which of the following has highest productivity?
) Taguchi (a) Job-shop production (6) batch production
8. Which of the
(a)
following is NOT the part of (c) mass production ()none ofthe above
Replace working by 'rule of Taylor's four
most efficient way to thumb, use the scientificprinciples of scientific
managemeent? Answers
b) Job perform specific tasks. method to study work and
and specialization,
motivation
i.e. rather
than
deternmuu 1.(d) 2. (d) 3. () 4. () 5. (c) 5. (a)
to their simply assign workers to
jobs, and train 10.
7. (d) 8. (d) 9. (a)
(c) Monitor wosker them do any
job, match (6) 11. (d) 12. (a) 13. (c) 14. (a) 15. (c)
períormance, to work at match worke
worker's capabilily
using the most efficient and
provide maximum
efficiency.
(a) Optimize order size of theways of working, instructions and supervision to ensure that they are REVIEW QUESTIONS
9. What are the main product for cnsu
(a) Job shop types of purchasing
production systems?
or
production. 1) Define the term "industrial engineering'. How it differs from industrial
management?
b) Flexible production, batch 2. Discuss the various phases of
conceptual development of industrial engincering.
manufacturing and production, mass

manufacturinproduction,
3. What do you mean by a
lean production system? How do you classify the production system
g continuous
producno" volume of items produced? based on