Productivity and Operations Strategy: Productivity Measures, Improvement Techniques and Competitive Priorities Questions

Question 1

Write any one competitive priority.

Accepted Answer

One competitive priority is **delivery reliability** (delivering products on time consistently).

Question 2

What is lean production?

Accepted Answer

**Lean production** is an approach that focuses on eliminating **waste (muda)** and improving flow to deliver value to customers.

Question 3

What is Kaizen?

Accepted Answer

**Kaizen** means **continuous improvement** through small, regular improvements involving everyone.

Question 4

Define productivity.

Accepted Answer

**Productivity** is the ratio of **output to input**, i.e., Productivity = Output / Input.

Question 5

What is an order qualifier?

Accepted Answer

**Order qualifier** is a minimum requirement (like basic quality or standard delivery time) that a firm must meet to be considered by customers.

Question 6

State one benefit of productivity improvement.

Accepted Answer

One benefit is **lower unit cost**, which improves competitiveness and profitability.

Question 7

Explain types of productivity measures (partial, multifactor and total) briefly.

Accepted Answer

Types of productivity measures:

- **Partial productivity**: output divided by a single input.
  - Example: **labour productivity** = units / labour-hours.
- **Multifactor productivity (MFP)**: output divided by a combination of inputs (e.g., labour + capital).
  - Example: value output / (labour cost + machine cost).
- **Total productivity**: output divided by the value of all inputs combined.

Thus, total and multifactor measures give a broader view than partial measures.

Question 8

Explain factors affecting productivity (any four).

Accepted Answer

Factors affecting productivity (any four):

- **Technology and machines**: automation level and machine condition affect output and downtime.
- **Skill and training**: trained workers reduce errors and improve speed.
- **Work methods/layout**: good methods and layout reduce motion and waiting.
- **Quality level**: fewer defects reduce rework and scrap, increasing effective output.
- Maintenance and motivation/incentives also influence productivity.

Hence, productivity depends on people, process, equipment and quality.

Question 9

Explain 5S and how it improves productivity (any three points).

Accepted Answer

### **5S and Productivity**

**5S** is a workplace organization method: **Sort, Set in order, Shine, Standardize, Sustain**.

How it improves productivity (any three):
- reduces **searching time** by keeping items in fixed places (Set in order).
- improves **safety and cleanliness** (Shine), reducing accidents and breakdown-like issues.
- creates **standard work** (Standardize) and discipline (Sustain), reducing variation and errors.

Thus, 5S improves efficiency and supports better quality and faster work.

Question 10

Explain competitive priorities and trade-offs (any three points) with a small table.

Accepted Answer

Competitive priorities are the dimensions on which operations competes: **cost, quality, delivery, flexibility, service**.

Trade-offs (any three points):
- high **flexibility/variety** can increase cost due to setup and complexity.
- very high **speed** may increase overtime and cost.
- higher **quality** initially may increase inspection effort, but reduces defects and total cost later.

Mini table:

| Priority | Meaning |
|---|---|
| **Cost** | low unit cost |
| **Quality** | fewer defects, better performance |
| **Delivery** | speed + reliability |
| **Flexibility** | variety/customization |

Thus, operations strategy aims to balance priorities and reduce trade-offs through better design and improvement.

Question 11

Explain types of waste (muda) in lean manufacturing (any four).

Accepted Answer

Lean focuses on eliminating **waste (muda)**—activities that do not add value.

Types of waste (any four):
- **Overproduction**: producing more/earlier than needed.
- **Waiting**: idle time due to delays, machine breakdown, or imbalance.
- **Transportation**: unnecessary movement of materials.
- **Inventory**: excess stock tying up money and space.
- **Motion**: unnecessary movement of workers.
- **Defects**: rework, scrap and customer complaints.

Thus, reducing muda improves cost, delivery speed and quality.

Question 12

Explain order winners and order qualifiers with examples (any three points) and a mini table.

Accepted Answer

**Order qualifiers** are the minimum requirements to be considered by the customer. **Order winners** are the factors that actually win the order.

Examples/points (any three):
- In a basic consumer product, **quality** may be a qualifier, but **low price** may be the order winner.
- In a premium product, **quality/design/service** may be the order winner.
- If a firm fails qualifiers (basic quality or delivery reliability), it will lose the order even if its price is low.

Mini table:

| Term | Meaning | Example |
|---|---|---|
| **Qualifier** | must-have to compete | basic quality, standard delivery |
| **Winner** | key factor to win | lowest price, fastest delivery |

Thus, operations strategy should ensure qualifiers are met and then strengthen order winners.

Question 13

Explain productivity improvement techniques used in industry (exam-style; any six points).

Accepted Answer

### **Productivity Improvement Techniques (Exam-Style)**

Productivity improvement means producing more output with the same resources (or the same output with fewer resources) while maintaining quality.

Techniques (any six):
- **Work study** (method study + time study) to remove unnecessary motions and set standard time.
- **Standardization** and SOPs to reduce variation and errors.
- **Quality improvement** (reduce defects, rework and scrap) using QC tools.
- **Preventive maintenance** to reduce breakdowns and increase machine availability.
- **Layout and material handling improvement** to reduce movement and waiting.
- **Training and skill development** to increase worker efficiency.
- **Lean manufacturing** to eliminate waste (waiting, inventory, defects etc.).
- **Kaizen** for continuous small improvements.

Mini flow:

```text
Measure → Identify losses (waste/defects/downtime) → Improve (lean/work study/maintenance) → Standardize → Review
```

**Conclusion:** Systematic improvement reduces cost, improves delivery and raises competitiveness.

Question 14

Explain OEE (Overall Equipment Effectiveness) with formula and interpretation (exam-style with table).

Accepted Answer

### **OEE (Overall Equipment Effectiveness) — Exam-Style**

**OEE** measures how effectively equipment is used compared to its full potential.

#### **Formula**
- **OEE = Availability × Performance × Quality**

#### **Meaning of each component**

| Component | Captures losses due to | Examples |
|---|---|---|
| **Availability** | downtime | breakdowns, setup time |
| **Performance** | speed loss | slow cycles, minor stoppages |
| **Quality** | defects | scrap, rework |

Interpretation:
- Low availability → focus on **maintenance** and setup reduction.
- Low performance → focus on method improvement and bottleneck removal.
- Low quality → focus on process control and quality improvements.

**Conclusion:** OEE helps identify where productivity is being lost and guides improvement actions.

Question 15

Explain operations strategy and its key decision areas (exam-style) with a flowchart.

Accepted Answer

### **Operations Strategy (Exam-Style)**

**Operations strategy** is a long-term plan for designing and managing operations so that it supports business strategy and competes on selected priorities.

#### **Key decision areas**
- **Capacity strategy**: how much to produce now and in future.
- **Process choice**: job/batch/mass/continuous; level of automation.
- **Facilities**: location and plant layout decisions.
- **Quality strategy**: conformance and continuous improvement systems.
- **Supply chain**: sourcing, outsourcing, supplier relationships.
- **Workforce strategy**: skills, training, flexibility, incentives.

Flowchart:

```text
Business goals
   ↓
Choose competitive priorities (cost/quality/delivery/flexibility/service)
   ↓
Align decisions (capacity + process + facilities + supply chain + quality + workforce)
   ↓
Implement improvement systems (lean/Kaizen/OEE)
   ↓
Measure performance → feedback and revise
```

**Conclusion:** A strong operations strategy aligns resources and processes to deliver consistent competitive advantage.

Productivity and Operations Strategy: Productivity Measures, Improvement Techniques and Competitive Priorities

8 more questions to unlock