Reference no: EM132622391
Operations Management
Discussion Questions on Single Factor and Multi Factor Productivity
Question 1. John Lucy makes wooden boxes in which to ship motorcycles. John and his three employees invest a total of 40 hours per day making 120 boxes.
a. What is their productivity?
b. John and his employees have discussed redesigning the process to improve efficiency. If they can increase the rate to 125 per day, what will be their new productivity?
c. What will be their percentage increase in productivity and percentage change?
Question 2. Eric Johnson makes billiard balls in his New England plant. With recent increases in his costs, he has a newfound interest in efficiency. Eric is interested in determining the productivity of his organization. He would like to know if his organization is maintaining the manufacturing average of 3% increase in productivity. He as the following data representing a month from last year and an equivalent month this year:
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Last Year
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Now
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Units produced
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1000
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1000
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Labor (hours)
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300
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275
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Resin (pounds)
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50
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45
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Capital invested ($)
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10,000
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11,000
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Energy (BTU)
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3,000
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2,850
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Show the productivity percentage change for each category and then determine the improvement for labor-hours, the typical standard for comparison.
Question 3. Eric Johnson (using data from question 2) determines his costs to be as follows:
• Labor: $10 per hour
• Resin: $5 per pound
• Capital expense: 1% per month of investment
• Energy: $.50 per BTU
Show the percentage change in productivity for one-monthlast year versus one this year, on a multifactor basis with dollars as the common denominator.
Question 4. In December, General Motors produced 6,600 customized vans at its plant in Detroit. The labor productivity at this plant is known to have been 0.10 vans per labor-hour during that month. If 300 laborers were employed at the plant that month, how many hours did the average laborer work that month?
Question 5. David Upton is president of Upton Manufacturing, a producer of Go-Kart tires. Upton makes 1,000 tires per day with the following resources:
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Labor
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400 hours per day @ 12.50 per hour
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Raw materials
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20,000 pounds per day @ $1 per pound
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Energy
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$5,000 per day
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Capital
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$10,000 per day
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a. What is the labor productivity per labor hour for these tires at Upton Manufacturing?
b. What is the multifactor productivity for these tires at Upton Manufacturing?
c. What is the percentage change in multifactor productivity if Upton can reduce the energy bill by $1,000 per day without cutting production or changing any other inputs?