A STUDY ON

THE WAYS TO UTILISE EXISTING TO INCREASE PRODUCTIVITY LEVEL

By

[Link]
[Link]: 820812631053 OF

EGS PILLAY ENGINEERING COLLEGE A PROJECT REPORT

Submitted Under the Guidance of

FACULTY OF MANAGEMENT STUDIES

In partial fulfilment of the requirements For the award of the degree of

MASTER OF BUSINESS ADMINISTRATION ANNA UNIVERSITY CHENNAI 600 025.

A STUDY ON THE WAYS TO UTILISE EXISITING WORKFORCE TO INCREASE PRODUCIVITY LEVEL

OBJECTIVES OF THE STUDY PRIMARY OBJECTIVES To utilize existing workforce to increase productivity level

SECONDARY OBJECTIVES To correlate level of absenteeism and productivity level

To identify whether installing a new machine will increase the productivity level

To provide feedback about the compensatory program through labour survey

REVIEW OF LITERATURE MEANING OF PRODUCTIVITY

Productivity is a relationship between the output (product/services) and the input (resources consumed in providing them) of a business system.

Output Productivity = ------------------Input For the survival of any organization, this productivity ratio must be at least 1. If it is more than one, the organization is in a comfortable position. So, the objective of the organization should be to identify ways and means to improve productivity to the highest possible level.

Definitions of productivity:

Productivity is a function of providing more and more of everything to more and more people with less consumption of resources.

The volume of output attained in given period of time in relation to the sum of the direct and indirect efforts expended in its production.

Productivity is the multiplier effect of efficiency and effectiveness.

DIFFERENT PRODUCTIVITY MEASURES

Material productivity

It shows the quantitative relationship between the total output and the material input

Material productivity

Total output Material input

Labour productivity

It shows the quantitative relationship between the total output and the material input

Labour productivity

Total output Labour input

Capital productivity

It shows the quantitative relationship between the total output and the Capital input

Capital productivity

Total output Capital input

Energy productivity

It shows the quantitative relationship between the total output and the Energy input

Energy productivity

Total output Energy input

Other manufacturing productivity

It shows the quantitative relationship between the total output and the other manufacturing expenses input

Other manufacturing expenses productivity

___________Total output________ Other manufacturing expenses input

Total productivity

It shows the quantitative relationship between the total output and the total resources input (material, labour, capital, energy, and other manufacturing expenses)

Total productivity

= Total output

(Material +labour+ capital +energy+ other manufacturing expenses

JAPANESE SHISEIDO CORPORATION

(Suggestion for increase the productivity)

Companies can increase productivity in a variety of ways. The most obvious methods involve automation and computation which minimize the tasks that must be performed by employees. Recently, less obvious techniques are being employed that involve ergonomic design and worker comfort. A comfortable employee, the theory maintains, can produce more than a counterpart who struggles through the day. In fact, some studies claims that measures such as drastic effect on office done by productivity. They suggest that productivity could be increased by means of perfuming or deodorizing the air conditioning system of work place. Increase the productivity also can influence society more broadly, by improving living strands, and creating income.

NEW CONCEPTS OF PRODUCTIVITY AND ITS IMPROVEMENT Arturo L. Tolentino

The globalization of manufacturing and the increased concern about social and ecological issues make productivity improvement more important. At the same time, a broader meaning of productivity calls for a wider set of indicators to catch and reflect the new elements and parameters involved. The broader conception of productivity is incorporating wider definitions of what the outputs and inputs are of the production-distribution process. The social and ecological impacts are now increasingly considered as outputs of the production process in addition to the traditional physical and value measures of outputs. Similarly, the social and ecological costs are now also being recognized as inputs in the productivity equation. With increasing concerns on the social and ecologic impacts of the operations of enterprises, the definitions of what are inputs and outputs are changing. Social and ecological inputs and outputs are increasingly being factored-in the

efficiency and effectiveness performance of the enterprise.

European productivity agency

Productivity

is an attitude of mind. It is the mentality of progress, of the constant

improvement of that which exists. It is the certainty of being able to do better today than yesterday and continuously. A major problem with productivity is that it means things to many people. Economists determine it from Gross National Product (GNP), managers view it as cost cutting and speed up, engineers think of it in terms of more output per hour. But generally accepted meaning is that it is the relationship between goods and service produced and the resources employed in their production.

Rgis Bonnelli - Ministry of Economy

From the point of view of global manpower productivity - measured by the production/ potentially active population ratio - it is only possible to increase its value in the medium term by increasing production (numerator of the fraction). The solution of deliberately reducing the denominator fortunately has not been considered since the defeat of Nazism. It is an elementary question that to maintain constant the number of busy or employed people, and at the same time to increase the manpower productivity it is necessary to increase the production in the same proportion. For a country with a growing potentially active population it is necessary to grow even more in order to maintain the occupation rate. Exporting workers - which in a way we are already doing - does not seem a desirable solution for a country with natural resources like Brazil.

SEVERAL STRATERGIES FOR IMPROVING PRODUCTIVITY

Increased output for the same input. Decreased input for the same output. Proportionate increase in output is more than the proportionate increase in the input. Proportionate decrease in input is more than the proportionate decrease in output. Simultaneous increase in the output with decrease in the input.

Increased output for the same input

In this strategy, the output is increased while keeping the input constant. Let us assume that in a steel plant, the layout of he existing shops is not proper. By slightly altering the location of the billet-making section, i.e. bringing it closer to the furnace which produces hot metal, the scale formation at the top of ladles can be reduced to a greater extent. The molten metal is usually carried in ladles to the billet-making section. In the long run, this would give more yield in terms of tons of billet produced. In this exercise, there is no extra cost involved. The only task is the relocation of the billet-making facility by shifting it closer to the furnace which involves insignificant cost.

Decreased input for the same output

In this strategy, the input is decreased to produce the same output. Let us assume that there exists a substitute raw material to manufacture a product which has the required properties and it is available at a lower price. If we can identify such material and use it for manufacturing the product, then certainly it will reduce the input cost. In this exercise, the job of the purchase department is to identify an alternate substitute material. The process of identification does not involve any extra cost. So, naturally, the productivity ratio will increase because of the decreased input by way of using the cheaper raw material to produce the same output.

Proportionate

increase

in

the

output

is

more

than

the

proportionate increase in the input

Consider the example of introducing a new product into the existing product mix of an organization. Let us assume that the existing facilities are not fully utilized. So, the R&D wing of the company has identified a new product which has a very good market and which can be manufactured with the surplus facilities of the organization. If the new product is taken up for production, then the following will result. (a) There will be an increase in the revenue of the organization by way of selling the new product in addition to the existing product mix. (b) There will be an increase in the material cost, and operation and maintenance cost of machineries because of producing the new product. If we closely examine these two increases, we find that the proportionate increase in the revenue will be more than the proportionate increase in the input cost. Hence, there will be a net increase in the productivity ratio.

Proportionate decrease in the input is more than the proportionate decrease in the output

Let us consider the reverse case of the previous example, i.e. dropping an uneconomical product from the existing product mix. This will result in the following: (a) There will be a decrease in the revenue of the organization because of dropping a product from the existing product mix. (b) There will be decrease in the material cost, and operation and maintenance cost of machineries because of dropping an existing product from the product mix. If we closely examine these two decreases, we find that the proportionate decrease in the input cost will be more than the proportionate decrease in the revenue. Hence, there will be a net increase in the productivity ratio.

Increase in the output with decrease in the input:

Let us assume that advanced automated technologies like, Robot, Automated Guided Vehicle System (AGVS), etc., are available in the market which can be employed in the organization of our interest. The outcome of these modern tools can be summarized as followings. (a) There will be a drastic reduction in the operation cost. Initially, the cost on equipment would be very high. But, in the long run, the reduction in the operation cost would break-even the high initial investment and offer more savings on the input. (b) These advanced facilities would help in producing more number of goods because they dont experience fatigue. The increased production will therefore yield more revenue. In this example, there is an increase in the revenue while there is a decrease in the input in the long run. Hence, the productivity ratio will increase at a faster rate.

RESEARCH METHODOLOGY
RESEARCH
Research is the process of finding solutions to a problem after a thorough study and analysis of the situational factors

RESEARCH DESIGN-MEANING & DEFINITION

A research design is a procedural plan that is adopted by researcher to answer questions validly,objectively,accurately and economically According to SELLTIZ ET AL., A research design is the arrangement of conditions for collections and analysis of data in a manner that aims to combine relevance to the research purpose with economy in procedure It is descriptive research type are those, which are concerned with describing the characteristics of a particular individual or of a group, where we cannot control the variables

SAMPLING DESIGN Population Sampling Unit Sample Size : 78 Members : Labour : 32 nos.