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Productivity, Process Improvement and Lean Thinking

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Choose one of the following types of organizations: Hospital, local bakery, generic family restaurant, generic convenience store (could be a franchised store), a company of your own choice

Create a company of this type. Identify and discuss at least three productivity issues that this company faces. Include the various productivity ratios that would be calculated. Then identify and discuss how this company would deal with improving its productivity. Identify specific processes and how these processes would be analyzed. What are some ways the processes could be improved? Discuss concepts and ideas from process improvement and lean thinking.

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The solution discusses productivity, process improvement and lean thinking.

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PRODUCTIVITY & PROCESS IMPROVEMENT: LOCAL BAKERY

Productivity
Robbins and Coulter (2005) define productivity as the overall output of goods or services divided by the inputs needed to generate that output. This is also called the productivity ratio.
As applied to a local bakery the outputs may be volume of breads and bread products produced in a particular period of time - may be in a day, week, or month. Hence, if there are categories of bread products produced, the outputs will be the numbers of units produced multiplied by the number of bread categories or related product lines.
The inputs utilized in the productions are the resources used by the bakery in terms of human resources, machineries, equipment, raw materials, and others that the local bakery utilize for the production of bread and bread products.

1. Issues
Among the issues faced by a production manager are on the following:
a) Attainment of effectiveness
Attainment of effectiveness is equivalent to attainment of production-related goals and objectives. Effectiveness in production may therefore be attained if the production targets are met. Production targets may be in terms of volume of production or quality of products that are within the specification of the buyers.
Robbins and Coulter define effectiveness as completing activities so that organizational goals are attained. To them, this is equivalent to "doing the right things".
Production effectiveness has constraints - the capabilities of human resources as well as the capacities of machineries ad equipment. Production capabilities of people have constraints that may include: their knowledge and skills; job commitments, motivations, and opportunities. Machineries and equipment have also constraints such as: machine -hours and volume of capacity limits.
Other inputs such as raw materials are also limited to the possible volume of supply as against the company competitors.

b) Attainment of efficiency
Efficiency means getting the most output from the least amount of inputs or "doing the things right" (Robbins and Coulter, 2005). Attainment of efficiency is an issue because it is limited to factors such as: ...

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  • Master in Business Administration, Saint Mary's University
  • Doctor of Philosophy in Education, University of the Philippines
  • Doctor in Business Adminstration (IP), Polytechnic University of the Philippines
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