Cost reduction strategies
production
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Any manufacturing unit would have a production facility where good are produced .Production
comprises of man , machine and material .Proper allocation of jobs , layout and material results in
cost efficient production .
What is productivity
Productivity measures the efficiency with which resources such as labour or capital are employed
in the production process. There are two widely used productivity measures; labour productivity
and multifactor productivity.
Labour productivity is measured as real output per hour worked. Multifactor productivity, a
broader measure of efficiency, is measured as real output per unit of combined inputs (capital,
labour, etc).In essence, this is the efficiency of all or your factors of production.
A business wishing to improve its profitability must undertake certain steps that can guarantee to
provide the desired results. One of the things that the management staff must give important
notice is the production and productivity of the business as a whole. As has been known, to
increase the profitability of an enterprise, certain things must be improved in the workplace. To
increase productivity is one of these.
Activity can be identified with production and consumption. Production is a process of combining
various immaterial and material inputs of production so as to produce tools for consumption. The
methods of combining the inputs of production in the process of making output are called
technology. Technology can be depicted mathematically by the production function which
describes the function between input and output. The production function depicts production
performance and productivity is the metric for it. Measures may be applied with, for example,
different technology to improve productivity and to raise production output.
LOCATION:
Companies now days are shifting base to lower cost of production which make sense .
production base in cities or metros have become non viable as cost of living , cost of raw
material ,overhead cost and tranportation cost have gone above the roof . Companies are
moving to low cost areas like CHINA , INDIA , UKRAINE ,IRELAND , VIETNAM ETC .locally
companies have shut operation in DELHI , MUMBAI , CHENNAI , KOLKATA and moved to areas
like UTTARAKAND , JHARKHAND , JAIPUR , BADI , etc .
WORK STANDARDS
All standards for operations should be displayed at working stations in local language s with dos
and donts.
AUTONOMOUS MAINTENANCE
Operators to be trained to do regular maintenance instead of waiting for maintenance personeel to
come and attend these breakdowns .Preventive maintenance to be scheduled for better
performance of Machines.
MANPOWER ALLOCATION PER MACHINE
It has to be ensured that the manpower deputed per machine should be adequate and is not low
or high .
TOOLS
Necessary tools to be placed near work stations
WORK AND TIME STUDY
Measure the time taken by a worker to complete a job with some industry standards and in case
execessive labour is employed then the additional one can be relocated .
REDUCE LOSS OF TIME DURING SHIFT CHANGE OVERS
PRODUCTION BOARDS AT EACH WORK STATIONS
LABOUR PRODUCTIVITY
The handling of product and raw material shoudl be reduced to minimum by either putting of
conveyors or automatic transfer to the machine .
To have minimum movement of manpower for getting material , tools and shifting .
To have zero defective and rework as it is nothing but pure waste . The first step towards
elimination is to adopt standards like ISO -9000 & GMP or in house standards.
Study the positions of worker while working and eliminate those position were worker feel
uncomfortable or experience stress while working .This would help in better productivity .
More on production efficiencies
PRODUCTION MANAGEMENT FOR
BETTER PRODUCTIVITY