Quantitiative Techniques (3) Flashcards
What is learning curve theory?
Situations where the workforce as a whole improves in efficiency with experience
What does the learning effect describe?
Speeding up a job with repeated performance
When workforce gains experience in a task and will come to perform that task quicker?
Labour costs and variable overheads will be lower in later periods of production when new product or production technique is introduced
Theory of learning curves only hold if (manual element)
There must be a significant manual element in the task being considered
Theory of learning curves only hold if (repetitive)
The task must be repetitive
Theory of learning curves only hold if (early stage)
Production must be at early stage so there is room for improvement
Theory of learning curves only hold if (consistency)
There must be consistency in the workforce
Theory of learning curves only hold if (extensive)
There must not be extensive breaks in production, or workers will forget the skill
Theory of learning curves only hold if (motivated)
Workforce must be motivated
When a learning curve applies?
There is a learning rate and a learning effect
How is the learning rate expressed?
As a percentage value
What is the learning effect?
As workforce learns from experience how to make the new product, there is a big reduction in time taken to make additional units
Every time that the cumulative output of the product doubles?
Average time to make all the units produced to date is a proportion of what it was before. This proportion is the learning rate
Time per unit and steady state?
Eventually, the time per unit will reach a steady state where no further improvement can be made
When a steady state is reached?
A standard time and standard labour cost for the product can be established
