Manufacturing Efficiency
Improving performance requires the establishment of a standard

A common dimension that all competitive organizations must focus on over the long haul is their operating efficiency. Efficiency is easily defined as the capacity to perform a given task within a specified standard time. The formula looks like the following:

Efficiency = Standard Time (Actual Time X 100%)

Given the degree that this result is equal to or greater than 100, the organization is efficient.

When this figure is lower, for example 80, it means that the organization must focus on raising its efficiency to remain competitive. Key indicators that identify an inefficient organization are poor quality, high costs and long deliveries. Organizations with efficiencies well below 100 must focus upon two factors to remain in business: The human performance factor and the technology innovation factor.

Human performance dimensions
Performance is the result of a pattern of actions carried out to satisfy an objective according to some standard. The problem work designers often have with this definition is that of confusing patterns of actions with performance results. Notice that the definition states, “actions carried out to satisfy an objective according to some standard.” They get caught up in measuring behaviors rather than results to some standard.

The first step to improving human performance is to establish a standard. The two most common standards in a manufacturing environments are quality and quantity. To place a wheel on an automobile on an assembly line suggests an action or a series of actions aimed at fulfilling an objective. Then, performance can be measured according to how accurately and fast the “actions” are performed.

When good standards are set for any work activity, managers can compare them with the outcomes of performer actions, and evaluate the differences. This suggests that all standards must be well understood by the performer. There are four standards that should be made a part of every system: Accuracy, speed, skill development time, and performer satisfaction. There should be some quantifiable measures for each of the four standards when we design any work activity.

Technology innovation
Organizations have two possibilities in the application of technology to improve operating efficiencies. First, the organization needs a capable staff of technical professionals to apply new innovative methods for performing value-add transformation in manufacturing processes. This capability includes the application of process design elements that contribute to improved efficiency. The second and often overlooked, technical skill is that of workers who actually perform various operation tasks. These workers become experts within a reasonable time; they know the most about the work elements used.

The organization that makes full use of worker ideas, “one small step of improvement every day,” will out-perform their competition in the long run. Each day these small improvements add up to major efficiency gains over time. Toyota Motor Manufacturing has achieved remarkable success in improved quality, lowest possible costs, and delivered on time automobiles to customers by taking full advantage of their employees’ ideas. Taiichi Ohno, the inventor of “lean manufacturing” says, “Employees are right at least half of the time.”

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