LEARNING

CURVES
Dr. Anurag Tiwari
IIM Rohtak
 LEARNING CURVE
CONCEPTS
 A learning curve is a line displacing the relationship between unit production time and the
cumulative number of units produced.
 Predicts reduction in manufacturing costs or direct labor hours as cumulative production
increases.
 Based on empirical evidence rather than theory.
 Learning Curves can be applied to individuals or organization .
 Individual learning is improvement that results when people repeat a process and gains skill
and efficiency.
 Organizational Learning results from practice as well, but it also came from changes in the
administration, equipment, and product design.
 ASSUMPTION IN LEARNING
CURVE
 Learning curve theory is based on three assumptions:
 The amount of time required to complete a given task or unit of a product will be less each time
the task is undertaken.
 The unit time will decrease at a decreasing rate.
 The reduction in time will follow a predictive patterns.

 In Manufacturing Case:
 Process should be repetitive
 Process should more labor intensive
 Least employee turnover
LEARNING CURVES AS TIMES
AND NUMBER OF UNITS

Cumulative Average Output Per

Time per Time Period
Unit

Average
Observed Output during
Data Fitted Time
a Time Period
in future
Unit Number Time
A Progress Curve Industrial Learning
FACTORS AFFECTING THE
LEARNING CURVE
Worker’s Work
Material
Skill Method

Product Learning
Tools
Design Curve

Continuous Process
Improvement Design
 MODELS
 Cumulative average time learning models (Wright Model)
 Incremental unit time learning model (Crawford Model)
 CUMULATIVE AVERAGE TIME
LEARNING MODEL
 Learning increase with a fixed percentage every time when production become double

 Formula
 Total Time= Initial Time*(2*LC)*(2*LC)*(2*LC)…
WRIGHT LEARNING CURVE

Production
Cost

Unit number
 WRIGHT LEARNING CURVE
 In Wright's Model, the learning curve function is defined as follows

Y = aXb
where:
Y = the cumulative average time (or cost) per unit.
X = Unit number
a = time (or cost) required to produce the first unit.
b = slope of the function or learning decimal percentage.
   = log of the learning rate/log of 2.
LEARNING CURVE-80%
Unit numbers Unit Direct Cumulative Cumulative Avg
Labor Cost Direct labor Direct labor
Hours Hours
1 100 100 100
2 80 180 90
4 64 314.20 78.553
8 51.2 534.592 66.824

 Can calculate with log formula-

= 100(8)^log0.8/log2
 EXAMPLE
 Suppose the first 20 units take 20 hours to be produced . The learning curve rate is 90%.

40 Units=20(2*0.9)=36 hours
80 Units=20(2*0.9)(2*0.9)=64.8 hours
160 Units=20(2*0.9)(2*0.9)(2*0.9)=116.64 hours
320 Units=Units=20(2*0.9)(2*0.9)(2*0.9)(2*0.9)=209.95 hours

 Total time taken by all units-Time taken by the previous unit

 2nd lot of 20 units took (36-20)=16/20=0.8 hours/unit
 EXAMPLE
 Aerosub Inc. has developed a new product for spacecraft that includes the manufacturing of a
complex part. The manufacturing of this part requires a high degree of technical skills.
Management believes there is a good opportunity for its technical force to learn and improve
as they become accustomed to the production process. The production of first unit requires
10000 direct labor hours. If an 80% learning curve is used and eight unit are produced, the
cumulative average direct labor hours required per unit of the product will be:
A. 5,120 hours
B. 6,400 hours
C. 8,000 hours
D. 10,000 hours
 EXAMPLE
 Unit 1= 10,000 hrs.
 Unit 2= (10,000*(2*0.8))=16,000
 Unit 4= (10,000*(2*0.8)(2*0.8))=25,600
 Unit 8= (10000* (2*0.8)(2*0.8)(2*0.8))=40,960
 Cumulative Direct labor hours= 40,960/8=5,120 hrs.
 INCREMENTAL UNIT TIME
LEARNING MODEL
 Every incremental unit takes less time at a fixed percentage due to the effect of learning curve.
 Assumption:
 Time declined by a constant percentage each time the cumulative quantity doubles. (i.e. 1 st, 2nd,
4th, 8th, 16th,… unit)
 Formula

Total Time= Initial Time*LC*LC*LC…

 EXAMPLE
 Suppose the first units take 20 hours to be produced . The learning curve rate is 90%.
 2nd unit= 20*0.9=18 hous
 4th unit= (20*0.9)*0.9=(18*0.9)= 14.58 hours
 8th unit =14.58*0.9=13.12 hours
 16th unit=13.12*0.9=11.81 hours
 EXAMPLE
 Propeller Inc. plans to manufacturer a newly designed high-technology propeller for airplanes. Propeller
forecasts that as worker gain experience, they will need less time to complete the job. Based on prior
experience, propeller estimates a 70% cumulative learning curve and has projected the following costs.

Cumulative number of Manufacturing Projections

Units produced Average Cost per unit Total Cost
1 20,000 20,000
2 14,000 28,000

 If Propeller manufacturer eight propellers, the total manufacturing cost would be a

A. $56,660
B. $54880
C. $62,643
D. $112,000
 EXAMPLE
 Unit 2 Cost=14,000
 Unit 4th cost = (14000*0.7)= 9800
 Unit 8th cost =(9800*0.7)=6860 cost per unit.
 Total Cost= 8*6860=54,880
 ESTIMATING THE
LEARNING PERCENTAGE
 The following guidelines are useful for estimating the impact of learning on manufacturing
tasks.
 These guidelines use estimates of the percentage of time spent on manual work versus the time
spent on machine-controlled work.
 75 percent hand assembly /25 percent machine = 80 percentage Learning
 50 percent hand assembly /50 percent machine = 85 percentage Learning
 25 percent hand assembly /75 percent machine = 90 percentage Learning
 SET OF GUIDELINE IN
SPECIFIC INDUSTRY
Aerospace, 85 Percent
Shipbuilding, 80-85 Percent
Complex machine tools for new model, 75-85 percent
Repetitive electronics manufacturing, 90-95 percent
Repetitive machine or punch-press operations, 90-95 percent
Repetitive electrical operation(wiring and circuit board fabrication), 75-85 percent
Repetitive welding operations, 90 percent
Raw material manufacturing, 93-96 percent
Purchased parts fabrication, 85-88 percent
 How Long Does Learning Go On ?
 INDIVIDUAL LEARNING
Employee Applicant A Employee Applicant B

2.0 2.0

1.5 1.5

Time
(minutes) 1.0
1.0

0.5 0.5

2 4 6 8 10
2 4 6 8 10
Repetition number Repetition number
 INDIVIDUAL LEARNING
 General Guideline to improve individual performance based on learning curves includes the following

 Proper Selection of Workers: A test should be administered to help choose the workers. These tests should be
representative of the planned work.
 Proper Training: The more effective the training, the faster the learning rate.

 Motivation: Productivity gains based on learning curves are not achieved unless there is a reward.

 Work Specialization: As a general rule, the simpler the task, the faster the learning.

 Do one or very few jobs at a time: Learning is faster on each job if completed one at a time, rather than working on
all jobs simultaneously.
 Use tools or equipment that assists or support performance:

 Provide Quick and easy access for help: The benefit from training are realized and continue when assistance is
available.
 Allow workers to help redesign their tasks: Taking more performance factors into the scope of learning curve, in
effect, shift the curve downwards.
ORGANIZATIONAL LEARNING
 LEARNING CURVE
APPLICATIONS
 Production planning / EOQ planning
 Price forecasting
Petrochemicals
Consumer durable goods
 Competitive bidding
 Income reporting in accounting
 Planning warranty maintenance
Washers / dryers
Televisions
 Forecasting industrial accidents
Petroleum industry
Mining
 Forecasting automobile accidents on new roadways
 LEARNING CURVE
EXAMPLES
TABLE E.1 Examples of Learning-Curve Effects
LEARNING-
IMPROVING CUMULATIVE CURVE
EXAMPLE PARAMETERS PARAMETER SLOPE (%)
1. Model -T Ford Price Units produced 86
production
2. Aircraft Direct labor-hours per Units produced 80
assembly unit

3. Equipment Average time to replace a Number of 76

maintenance at group of parts replacements
GE
 LEARNING CURVE
EXAMPLES
TABLE E.1 Examples of Learning-Curve Effects
LEARNING-
IMPROVING CUMULATIVE CURVE
EXAMPLE PARAMETERS PARAMETER SLOPE (%)
4. Steel Production worker Units produced 79
production labor-hours per unit
produced
5. Integrated Average price per unit Units produced 72a
circuits
6. Handheld Average factory selling Units produced 74
calculator price
 LEARNING CURVE
EXAMPLES
TABLE E.1 Examples of Learning-Curve Effects
LEARNING-
IMPROVING CUMULATIVE CURVE
EXAMPLE PARAMETERS PARAMETER SLOPE (%)
7. Disk memory Average price per bit Number of bits 76
drives
8. Heart 1-year death rates Transplants 79
transplants completed
9. Caesarean Average operation time Number of 93
section baby surgeries
deliveries