MGT 455
Chapter 10
Work Measurement

© 2014 Pearson Education, Inc.

10 - 1

Labor Standards
▶ Effective manpower planning is dependent on a knowledge of the labor required ▶ Labor standards are the amount of time required to perform a job or part of a job ▶ Accurate labor standards help determine labor requirements, costs, and fair work
© 2014 Pearson Education, Inc.

10 - 2

Labor Standards
▶ Started early in the 20th century
▶ Important to both manufacturing and service organizations
▶ Necessary for determining staffing requirements ▶ Important to labor incentive systems

© 2014 Pearson Education, Inc.

10 - 3

Meaningful Standards Help
Determine
1.
2.
3.
4.
5.
6.
7.

Labor content of items produced
Staffing needs
Cost and time estimates
Crew size and work balance
Expected production
Basis of wage-incentive plans
Efficiency of employees

© 2014 Pearson Education, Inc.

10 - 4

Labor Standards
May be set in four ways:
1.
2.
3.
4.

Historical experience
Time studies
Predetermined time standards
Work sampling

© 2014 Pearson Education, Inc.

10 - 5

Time Studies
▶ Involves timing a sample of a worker’s performance and using it to set a standard ▶ Requires trained and experienced observers ▶ Cannot be set before the work is performed © 2014 Pearson Education, Inc.

10 - 6

Time Studies
1. Define the task to be studied
2. Divide the task into precise elements
3. Decide how many times to measure the task
4. Time and record element times and rating of performance

© 2014 Pearson Education, Inc.

10 - 7

Time Studies
5. Compute average observed time
Average
observed time =

Sum of the times recorded to perform each element
Number of observations

6. Determine performance rating and normal time
Average
Normal time = observed time © 2014 Pearson Education, Inc.

x

Performance rating factor
10 - 8

Time Studies
7. Add the normal times for each element to develop the total normal time for the task
8. Compute the standard time
Standard time =

© 2014 Pearson Education, Inc.

Total normal time
1 - Allowance factor

10 - 9

Rest Allowances
▶ Personal time allowance
▶ 4% - 7% of total time for use of restroom, water fountain, etc.

▶ Delay allowance
▶ Based upon actual delays that occur

▶ Fatigue allowance
▶ Based on our knowledge of human energy expenditure © 2014 Pearson Education, Inc.

10 - 10

Rest Allowances
TABLE 10.1

Allowance Factors (in percentage) for
Various Classes of Work

1. Constant allowances:
(A) Personal allowance ……………………………………..

5

(B) Basic fatigue allowance ………………………………...

4

2. Variable allowances:
(A) Standing allowance ……………………………………..

2

(B) Abnormal position
(i)