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Operations Management - Bsba 2

Business

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Reymar Marasigan
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64 views26 pages

Operations Management - Bsba 2

Business

Uploaded by

Reymar Marasigan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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OPERATIONS

MANAGEMENT
SARAH JANE R. CUSI
Instructor
PRODUCTIVITY

Productivity - a measure of the effective use


of resources, usually expressed as the ratio of
output to input.

It is usually expressed as the ratio of output to


input:
Productivity growth
EXAMPLE SOLUTION
TRY TO SOLVE!

A company that processes fruits and


vegetables is able to produce 400 cases
of canned peaches in one-half hour
with four workers. What is labor
productivity?
SOLUTION
TRY TO SOLVE!

A construction company is able to


build 600 square meters of a house
in 8 hours with 5 workers. What is
the labor productivity of the
construction company?
COMPUTATION
• Total output = 600 square meters
• Number of workers = 5
• Time worked = 8 hours

Labor productivity = Output / Input


= 600 square meters / (5 workers * 8 hours)
= 600 square meters / 40 worker-hours
= 15 square meters per worker-hour

So, the labor productivity of the construction


company is 15 square meters per worker-hour.
TRY TO SOLVE!

A bakery produced 600 loaves


of bread in 6 hours using 10
workers. Calculate the labor
productivity.
COMPUTATION
• Total output = 600 loaves
• Number of workers = 10
• Time worked = 6 hours

Labor productivity = Output / Input


= 600 loaves / (10 workers * 6 hours)
= 600 loaves / 60 worker-hours
= 10 loaves per worker-hour

So, the labor productivity of the bakery is 10 loaves


per worker-hour.
TRY TO SOLVE!

A restaurant prepares
200 meals in 3 hours with
8 chefs. What is the labor
productivity of the
restaurant?
COMPUTATION
• Total output = 200 meals
• Number of workers = 8
• Time worked = 3 hours
Labor productivity = Output / Input
= 200 meals / (8 workers * 3 hours)
= 200 meals / 24 worker-hours
= 8.33 meals per worker-hour

So, the labor productivity of the restaurant is


approximately 8.33 meals per worker hour.
TRY TO SOLVE!

In year 1, a machine produced


2,500 units using 500 hours of
labor. In year 2, the machine
produced 3,000 units using 450
hours of labor. Calculate the
productivity growth rate.
COMPUTATION
Labor Productivity in year 1:
Growth rate:
= 2,500 / 500
=5 = 6.67 - 5 x 100
5
Labor Productivity in year 2:
= 0.334 x 100
= 3,000 / 450
= 6.67 = 33.4%
MULTIFACTOR
EXAMPLE SOLUTION
TRY TO SOLVE!
Determine the multifactor productivity for the
combined input of the labor and the machine using
the following:
Input:
Labor : P1,000
Materials: P520
Overheads: P2,000

Number of outputs produced:1,760 units


SOLUTION
Multifactor Productivity =

Output
________________________________
Labor + Materials + Overhead

= 1,760 units / (1,000 + 520 +2,000)


= 0.5 units
TRY TO SOLVE!
Compute the multifactor productivity
measure for an eight-hour day in which the
usable output was 300 units, produced by
three workers who used 600 pounds of
materials. Workers have an hourly wage of
$20, and material cost is $1 per pound.
Overhead is 1.5 times labor cost.
SOLUTION
TRY TO SOLVE!
Calculate the multifactor productivity for a
workday lasting six hours, during which 240
units were produced. This output was achieved
by four workers utilizing 480 pounds of
materials. Each worker earns $25 per hour, and
the material cost is $2 per pound. Additionally,
the overhead expense is twice the total labor
cost.
SOLUTION
Multifactor Productivity =
Output
________________________________
Labor + Materials + Overhead

= 240 units / ($600 + $960 + $1,200)


= 0.09 units

So, the multifactor productivity is approximately


0.09 units of output per dollar of input.
TRY TO SOLVE!
A team of 3 workers produces 180 gadgets in
5 hours using 300 pounds of materials. Each
worker is paid $20 per hour, and the cost of
materials is $3 per pound. Calculate the
multifactor productivity if the overhead costs are
three times the total labor costs.
SOLUTION
Multifactor Productivity =
Output
________________________________
Labor + Materials + Overhead

= 180 gadgets / ($300 + $900 + $900)


= 0.09 units

So, the multifactor productivity is approximately


0.09 units of output per dollar of input.
TRY TO SOLVE!
A cleaning service cleaned 15 houses in 3 days
using 4 workers. The week before, the same
team cleaned 18 houses in 4 days.
a. For which week was the labor productivity
higher? Explain.
b. What factors could have influenced the
productivity?
SOLUTION
Labor Productivity for the Current Week:

= 15 / 3x4
= 15 / 12
= 1.25
Labor Productivity for the Previous Week:

= 18 / 4x4
= 18 / 16
= 1.125
THANK YOU!

“Every action is an opportunity to improve.”


~Mark Graban

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