The Portable MBA in Finance and Accounting, 3rd Edition

(Greg DeLong) #1

214 Understanding the Numbers


“To take an obvious example, most automobiles have one battery, and an
engineering statement would so state. A perfection standard would call for 1
battery per automobile. When it comes to actual production, however, it would
not be unusual for one or more batteries to be damaged during installation.If
10,100 batteries are used in the manufacture of 10,000 cars, then it might ap-
pear as if each automobile actually had 1.01 batteries. One might, therefore,
want to set as one’s standard a currently attainable goal of 1.01 batteries on av-
erage, thus providing a 1% allowance for wastage.”


Time and Motion Studies


“Time and motion studies are the usual way in which engineering standards are
set for the labor component,” Jane explained. “An engineer watches over labor-
ers as they work and determines how much time it should take for each part of
the production process. When doing this, it is vital that the engineer gain
labor ’s cooperation. If not, disastrous results can occur. I love the following
quotation:”


You got to use your noodle while you’re working and think your work out ahead
as you go along! You got to add in movements you know you ain’t going to make
when you’re running the job! Remember, if you don’t screw them, they’re going
to screw you!...Every moment counts! ...
When the time-study man came around, I set the speed at 180. I knew
damn well he would ask me to push it up, so I started low enough. He finally
pushed me up to 445, and I ran the job later at 610. If I’d started out at 445,
they’d have timed it at 610. Then I got him on the reaming, too. I ran the
reamer for him at 130 speed and .025 feed. He asked me if I couldn’t run the
reamer any faster than that, and I told him I had to run the reamer slow to keep
the hole size. I showed him two pieces with oversize holes that the day man
ran. I picked them out for the occasion! But later on I ran the reamer at 610
speed and .018 feed, same as the drill. So I didn’t have to change gears.^3

Tom smiled appreciatively at the story. As an old f loor hand, he understood the
sentiments completely.


Motivation


“This raises a broader question, you know,” said Tom. “Should we invite people
to participate in setting the standards? Will it make them more motivated? I’ve
pondered this from a variety of angles. What’s interesting about it is that par-
ticipation doesn’t always work.
“ What I have discovered from my reading around the topic is that many
people prefer to be told what to do. This seems to be particularly true for peo-
ple who find their jobs boring and for those with a more authoritarian person-
ality. So one has to be really careful when inviting people to participate.”
“ You know more about this than I do,” responded Jane. “How do you han-
dle feedback, then. That’s a sort of after-the-fact participation isn’t it.”

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