Chapter 6: Learning Curves

McGraw-Hill/Irwin
What are Learning Curves?
• Learning curve: a line displaying the relationship between unit
production time and the cumulative number of units produced
• Wide range of applications
• Can be used to estimate time and cost
• One of the trade-offs in JIT
• Individual learning: improvement that results when people repeat a
process and gain skill or efficiency from their own experience
• Practice makes perfect
• Organizational learning: also comes from changes in administration,
equipment, and product design
• Expect to see both simultaneously
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Three Assumptions of Learning Curve
Theory

1. Time required to complete a given task will be less each time the
task is undertaken

2. Unit time will decrease at a decreasing rate

3. Reduction in time will follow a predictable pattern

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Finding the Learning Rate

1. Arithmetic tabulation

2. Logarithms

3. Some other curve-fitting method

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Learning Curves Plotted as Times and
Numbers of Units

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Plotting Learning Curves
• In practice, learning curves are plotted using a graph with logarithmic
scales
• The unit curves become linear throughout their entire range
• The cumulative curve becomes linear after the first few unit
• Direct logarithmic analysis is more efficient because it does not
require a complete enumeration of successive time–output
combinations

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Data for an 80 Percent Learning Curve

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Exhibit 6.2
Resulting Learning Curve Plots

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Exhibit 6.3
Logarithmic Analysis

• x = Unit number
• Yx = Number of direct labor hours required to produce the xth unit
• K = Number of direct labor hours required to produce the first unit

• b = Learning percentage

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Example
• First unit takes 100,000 hours
• 80 percent learning curve
• Find hours for eighth unit

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Example
• First unit takes 100,000 hours
• 80 percent learning curve
• Find hours for eighth unit

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Improvement Curves: Table of Unit Values

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Exhibit 6.4 (Partial)
Improvement Curves: Table of Cumulative
Values

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Exhibit 6.5 (Partial)
Estimating the Learning Percentage
1. Assume that the learning percentage will be the same as it has been for
previous applications within the same industry
2. Assume that it will be the same as it has been for the same or similar
products
3. Analyze the similarities and differences between the proposed start-up and
previous start-ups and develop a revised learning percentage that appears to
best fit the situation

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Individual Learning
1. Proper selection of workers
2. Proper training
3. Motivation
4. Work specialization
5. Do one or very few jobs at a time
6. Use tools that support performance
7. Provide quick and easy access for help
8. Allow workers to help redesign tasks

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Test Results of Two Job Applicants

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Exhibit 6.6
Organizational Learning
• Organizations learn as well
• A main source is individual learning
• An organization also acquires knowledge in its technology, its
structure, documents it retains, and standard operating procedures
• Knowledge can also be embedded in the organizational structure
• Knowledge can depreciate if individuals leave the organization
• Knowledge can depreciate if technologies become inaccessible or
difficult to use

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Managerial Considerations
Individual learning and incentives

• Workers and organization must have adequate incentives to enhance

learning

Learning on new jobs versus old jobs

• The newer the job, the greater the improvements possible

Improvement comes from working smarter, not harder

• Better methods and support systems, not increased effort, are the source of
gains

Suggesting a learning rate leads to a built-in bias

• Learning rate becomes a goal instead of an independent phenomenon

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Managerial Considerations

Preproduction versus postproduction adjustments

• High levels of preproduction planning mean early units will already incorporate a significant
amount of learning

Changes in indirect labor and supervision

• Changes to production conditions can influence the learning rate

Changes in purchasing practices, methods, and organizational structure

• Significant adjustments to any of these factors can affect production rate

Contract phase-out

• As a contract nears completion, learning curve may begin to turn upward

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