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Ch 8 - Human Resources

Human Resources and Quality Management (p314)
1. Human resources are becoming more important strategically because (p313):
  1. U.S. economy continues to shift from manufacturing to services.
  2. Services are more people intensive than capital intensive.
  3. Advances in information technology require better educated and more highly motivated employees.
2. *As a result, management’s traditional control-oriented relationship with employees has changed to one of cooperation, mutual trust, team work, and goal orientation necessary to achieve TQM (Ch 3).
3. *Many firms encourage employee participation in local plans so as to increases employee commitment to the overall strategic goals.
The Changing Nature of Human Resources Management (p315)
1. Scientific Management Era - started by Frederick Taylor in late 1800s
  1. Developed formal procedures for personnel selection and work methods.
  2. The Assembly Line - epitomized by Henry Ford (p316)
    1. Labor to produce Model-T reduced from 12 hours in 1908 to 3 hours in 1913
    2. Each worker performed highly repetitive, simple tasks, which required little training.
2. Human Relations Era (See Table 8.1, p317 and Ch1, p7)
  1. Abraham Maslow - 1940s - Hierarchy of Needs (physiological, security, affiliation, esteem, self-actualization).
  2. *Frederick Herzberg - 1950s - Two-Factor Theory
    1. Hygiene factors
      1. Salary, working conditions, company policy, …
      2. Lack results in dissatisfaction
      3. Existence does not motivate
    2. Motivation factors
      1. Recognition, advancement, personal growth, …
      2. Existence may motivate to excel.
3. Contemporary Trends in Human Resources Management (p317)
  1. *Increased job training - increased market volatility has increased management’s need for widely skilled workers
    1. *Cross training - employee learns more than one job
    2. *Job rotation - planned horizontal movement between two or more jobs.
  2. *Empowerment (part of TQM) - worker is responsible for product quality and quality improvement (can stop production)
    1. *Horizontal job enlargement - add tasks to create a meaningful work unit
    2. *Vertical job enrichment - add responsibility for planning and/or inspecting.
  3. Alternative workplaces (home office, satellite office, shared office) with telecommuting.
  4. *Group (not individual) incentives (p323)
    1. Gainsharing - employee shares in a group's performance (cost reduction, productivity increase, ...)
    2. Profit sharing - employee shares in overall company wide profit.
Job Design (p326)
1. Elements of Job Design (Table 8.2, p326)
  1. *Task Analysis
  2. *Worker Analysis
  3. *Environmental Analysis.
2. Graphical Aids Used in Job Analysis (p328)
  1. *Process Flowchart - Figs 8.1, 8.2, p329, Fig 6.4, p232
  2. *Worker-Machine Chart - Fig. 8.3, p330.
Learning Curves (p332)
1. Def - Learning Effect - each time the production quantity doubles, the unit production time is reduced by a constant rate.
  1. Example - A production process follows an 80% learning curve where first unit requires 100 hrs. Then:
    1. Second unit requires 100(.80) = 80 hrs
    2. Fourth unit requires 100(.80)² = 64 hrs
    3. Eighth unit requires 100(.80)³ = 51 hrs
2. *Learning Curve - let t_n denote the time to produce the n-th unit, then
  t_n = t₁ n^b
  where b = (log r) / (log 2) and r = learning fraction (p333).
3. Verification of learning property. (For your info. Not on exam.)
4. For n equal to a power of 2 (2, 4, 8, 16, . . . ), t_n can be easily computed without logs
  1. If n = 2^k, then t_n = t₁ r^k
  2. Example 8.3 - PCs - p333, t₁ = 18 hours, r = 0.8. Find t₄
    Since 4 = 2², t₄ = t₁ r² = (18) (0.8)² = 11.5 hours
    Do assigned HW - Problem 8-6.
Work Measurement (Chapter 8 Supplement, page 342)
1. Def - Standard Time - amount of time a qualified worker, working at a normal rate, will require to perform a specified task. (p342)
2. Uses of standard times
  1. Product costing and pricing
  2. Determination of staffing needs
  3. Assembly line balancing
  4. Wage-incentive plans
Methods to Determine Standard Times
1. *Stopwatch Time Study (p342)
  1. Divide task into elements
  2. Time and rate the worker as task is performed
  3. Compute normal time
    1. Normal time = S (performance rating) * (avg actual time)
    2. Performance rating - evaluation of individual worker compared to normal worker.
  4. Compute standard time - allows for unavoidable delays, fatigue, personal time, …
    Standard time = (Normal time) * (1 + Allowance factor)
  Example S8.1, p344 - sandwich assembly
  Do Assigned HW - Problem S8-4a only.
2. *Predetermined Motion Times (p347)
  1. Procedure
    1. Divide task into micro-motions, Table S8.1, p348
    2. Normal time = S (predetermined time stds)
    3. Standard time = (Normal time) * ( 1 + Allowance factor)
  2. Advantages relative to Time Study
    1. Does not disrupt production activities
    2. Can be set before task is performed
    3. Is accepted by unions as fair.
3. *Work Sampling (p349)
  1. Procedure
    1. Divide task into activities
    2. Randomly observe, rate and record worker activities
    3. Compute activity proportions
    4. Compute normal time
      Normal time = (Total time) * (Activity proportion) *
      (Perf. rating) / (Number of pieces produced)
    5. Standard time = (Normal time) * ( 1 + Allowance factor)
      (This page was last edited on August 16, 2006 .)