Principles of Operations Management: Sustainability and Supply Chain Management 10th Global Edition

Answer: 
MFP before: 500 boxes / ($10 × 5 × 16 + $3000 + $400) = 500 / 4200 = 0.119 boxes/dollar
MFP after: 600 boxes / ($10 × 5 × 16 + $3200 + $400) = 600 / 4400 = 0.136 boxes/dollar
Diff: 2
Key Term:  Multifactor productivity
AACSB:  Analytical thinking
LO:  1.5 Compute multifactor productivity
110) Gibson Products produces cast bronze valves for use in offshore oil platforms. Currently, Gibson produces 1600 valves per day. The 20 workers at Gibson work from 7 a.m. until 4 p.m., with 30 minutes off for lunch and a 15 minute break during the morning work session and another at the afternoon work session. Gibson is in a competitive industry, and needs to increase productivity to stay competitive. They feel that a 20 percent increase is needed.
 
Gibson's management believes that the 20 percent increase will not be possible without a change in working conditions, so they change work hours. The new schedule calls on workers to work from 7:30 a.m. until 4:30 p.m., during which workers can take one hour off at any time of their choosing. Obviously, the number of paid hours is the same as before, but production increases, perhaps because workers are given a bit more control over their workday. After this change, valve production increased to 1800 units per day.
 
a.   Calculate labor productivity for the initial situation
b.   Calculate labor productivity for the hypothetical 20 percent increase
c.   What is the productivity after the change in work rules?
d.   Write a short paragraph analyzing these results.
Answer: 
(a)  Workers are active for eight hours per day; labor productivity is 10 valves/hour
(b) If Productivity rises by 20 percent, to 12 valves/hour; output would be 12 × 8 × 20 = 1920
(c)  New productivity is 1800 / (20 × 8) = 11.25 valves/hour
(d) Gibson did not gain the desired 20 percent increase in productivity, but they did gain over 11 percent, without extra equipment or energy, and without increasing the labor cost.
Diff: 3
Key Term:  Productivity
AACSB:  Analytical thinking
LO:  1.4 Compute single-factor productivity
 

111) A local university is considering changes to its class structure in an effort to increase professor productivity. The old schedule had each professor teaching 5 classes per week, with each class meeting an hour per day on Monday, Wednesday, and Friday. Each class contained 20 students. The new schedule has each professor teaching only 3 classes, but each class meets daily (Mon.-Fri.) for an hour. New classes contain 50 students.
a.   Calculate the labor productivity for the initial situation (students/hour).
b.   Calculate the labor productivity for the schedule change (students/hour).
c.   Are there any ethical considerations that should be accounted for?
d.   Suppose that each teacher also is required to have 2 hours of Office Hours each day he/she taught class. Is the schedule change a productivity increase?
Answer: 
(a)  Professors teach 100 students in 15 hours or 6.67 students/hour.
(b) Professors teach 150 students in 15 hours or 10 students/hour.
(c)  Responses should focus on honoring stakeholder commitment and can include students per professor ratio, class sizes, quality of education, etc.
(d) Initial productivity is 100 students in 21 hours or 4.76 students/hour. New productivity is 150 students in 25 hours or 6 students/hour, an increase or 1.24 students/hour.
Diff: 3
Key Term:  Productivity
AACSB:  Analytical thinking
LO:  1.4 Compute single-factor productivity
112) A grocery chain is considering the installation of a set of 4 self-checkout lanes. The new self-checkout lane setup will replace 2 old cashier lanes that were staffed by a cashier and bagger on each lane. One cashier mans all 4 self-checkouts (answering questions, checking for unscanned items, taking coupons, etc.). Checkout on the new lanes takes 2 minutes (customers bag their own orders) while checkout with the old lanes took only 45 seconds. In addition the electricity costs for both setups are $0.05 per checkout while bagging (material) costs are $0.10 per checkout with the old system and $0.15 for the new system. The new lanes also require $100/per shift in capital costs. Assume that the lanes are always in use for 8 hours per day (1 shift) and that a worker makes $10/hour.
(a)   How many checkouts did the old system provide in a shift?
(b)   How many checkouts does the new system provide?
(c)   What is the multifactor productivity for each system?
Answer: 
(a)   (2 lanes)(8 hours)(3600 seconds/hour)(1 checkout/45 seconds) = 1280 checkouts