Introduction CONCLUSION AND RECOMMENDATION

1 CHAPTER 1 INTRODUCTION

1.1 Introduction

According to Barry 2008, Productivity is the ratio of outputs goods and services divided by the input resources, such as labor and capital. The operations manager’s job is to enhance improve this ratio of outputs to inputs. Efficiency means doing the job well while effective means doing the job right. Improving productivity means improving efficiency. Productivity = OutputInput Improvement means the elimination of waste and the most essential precondition for improvement is the proper pursuit of goal. The four goals of improvement must be to make easier, better, faster and cheaper Shingo, 1987. Opportunities for productivity improvement through improved labor efficiency and reduced production loss are critical to organizational survival and these efforts can be driven through a host of productivity improvement initiatives Longenecker and Stansfield, 2000; Longenecker et al., 1997. Goal setting and feedback have been proven to improve productivity Locke and Latham, 2002 and in general, the following is true: Performance goal setting + Specific performance feedback = Productivity improvement 2 Kaydos 1991 described that productivity and subsequently performance measurement has become more important and has been regarded as a prerequisite for continuous improvement. Essentially, productivity is a ratio to measure how well an organization or individual, industry, country converts input resources labor, materials, machines etc. into goods and services. This is usually expressed in ratios of inputs to outputs. That is input cost per output good service. It is not on its own a measure of how efficient the conversion process is. Productivity also measures the effectiveness in which organization uses its resources in transforming inputs to output. In order to continuously improve as much as possible, organization needs align all their resources to their maximum capabilities. Work Study combines every scientific analysis, method and logical flow of process to generate and ensure that the whole process meets the level of productivity and quality required. For a manufacturing standpoint, productivity improvement is most often interpreted as: faster cycle time, lower cost, maximized machine utilization, and also maximized floor space utilization. Since the need to reduce assembly cost has become significant in the last few years, productivity must continue to improve in the assembly house. Simulation has become a popular design technique for developing production schedules and dispatch lists in a manufacturing environment. With simulation we can deal real world problems with stochastic elements where no analytical solutions are available with sufficient accuracy, estimate the performance under projected operating conditions, compare alternative system designs, maintain experimental conditions well under control, and we can conduct long time frame study. For manufacturing systems, simulation can determine the bottleneck and optimization, at the same time it can be used to determine the best alternative by using comparison and sensitivity analysis. Compared to direct real experimentation, the computer simulation approach has the advantages, such as lower costs, shorter time, greater flexibility and much small risk. 3

1.2 Project Background