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Labor Productivity and Process Balancing Analysis

The document describes two questions related to productivity and assembly line balancing for an automaker. For Question 1: The automaker produced 1100 Model X cars over 8 days at a labor cost of $100/hour. Labor productivity for Model X was calculated. Productivity for Model Y, produced over 7 days at a different cost, was also calculated. Multi-factor productivity and interpretation were determined using output value and input costs. Productivity growth from December to January was calculated. For Question 2: An assembly line with 8 tasks and precedence relationships was described. The minimum stations were determined. Tasks were assigned to stations using longest processing time rules. The layout, efficiency, optimality, and output rate were calculated. Effects

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5 views2 pages

Labor Productivity and Process Balancing Analysis

The document describes two questions related to productivity and assembly line balancing for an automaker. For Question 1: The automaker produced 1100 Model X cars over 8 days at a labor cost of $100/hour. Labor productivity for Model X was calculated. Productivity for Model Y, produced over 7 days at a different cost, was also calculated. Multi-factor productivity and interpretation were determined using output value and input costs. Productivity growth from December to January was calculated. For Question 2: An assembly line with 8 tasks and precedence relationships was described. The minimum stations were determined. Tasks were assigned to stations using longest processing time rules. The layout, efficiency, optimality, and output rate were calculated. Effects

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Question 1: [20 Marks]

One automaker offers several car models, and models X and Y are in the best-selling list. In December, the
automaker produced 1100 cars of model X at a unit selling price of $120000. The automaker has 120 direct labor
employees whose compensation (including wages and fringe benefits) amounts to $100 per hour per employee.
During December, model X cars were produced on 8 working days (of 8 hours each), and other models were
produced on other days.
a. Determine the labor productivity of model X in December. [3 Marks]
b. The automaker produces model Y at a unit selling price of $150000. During December, 900 model Y cars were
produced on 7 working days (of 8 hours each). On one day, one employee called in sick. Determine the labor
productivity of model Y in December. [3 Marks]
c. Here is additional information about the automaker. The direct material cost of model X is $22000 per unit; the
direct material cost of model Y is $29000 per unit. The annual overhead expense incurred in operating the
whole production plant is $60,000 per working day.
i. Determine the multi-factor productivity of the automaker in December. [6 Marks]
ii. What is the interpretation of the multi-factor productivity? [2 marks]
iii. In January, the automaker produced 1,000 model Y cars in 8 working days (without any employee sick
leave). What was productivity growth (the percentage change) in labor productivity of model Y from
December to January? [6 Marks]

Note: For all productivity ratios (labor productivity ratios and multifactor productivity ratios), you should
use dollar values as Outputs and Inputs.

1
Question 2: [30 Marks]
A company is introducing a new model of car and needs to balance the process for its new assembly line, given
the following task times and precedence relationships. Assume that the cycle time is 15 minutes.

Task Time (minutes) Immediate Predecessor


A 8 Nil
B 7 Nil
C 4 A, B
D 6 A
E 6 D, C
F 6 C
G 4 D, F
H 6 E, G

You are required to:


a. Draw the precedencegraph. You should use arrows to connect tasks. [3 Marks]
b. Calculate the minimum possible number of workstations (N min ) required. [2 Marks]
c. Assign tasks to stations by using the longest processing time decision rule. In case of a tie, use the
tiebreaker to assign the task with the largest number of following tasks. [10 Marks]
d. Draw the product layout with the assignment of tasks into each workstation. [3 Marks]
e. Determine the efficiency of the process. [2 Marks]
f. Is the product layout obtained from part c optimal? Explain if it is or it is not. [2 Marks]
g. Compute the rate of output that could be expected for this line assuming a 480-minute working day.
[2 Marks]
h. If the task time of Task B is reduced by 1 minute from 7 minutes to 6 minutes, keeping the designed product
layout and the operating time unchanged, what will be the effect on the maximum possible system
efficiency and daily output? [6 Marks]

End of the assignment

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