Saturday, February 14, 2015

India National Productivity Day and Week 2015 - 12th to 18 February - Theme Zero Defect Zero Effect



Download Background paper released by  National Productivity Council

Participate in the Productivity Week Enthusiastically Help India Achieve $20 Trillion GDP

Important Themes


Productivity is output for unit of resources.

There can single factor productivity measures, multifactor productivity measures and total factor productivity measures.

Productivity per person employed is a very important measure, because it will directly translate into per capital income. If we want to increase per capita income, which is desirable to provide better standard of living to all our citizens we have to increase per capita income and that means we have to increase labour and employee productivity that is productivity per person.

Industrial Engineering

Industrial Engineering is Human Effort Engineering and System Efficiency Engineering.
It increases productivity of individual employees, managers, teams and entire production, service and distribution systems. It increases productivity of technical, business and managerial processes.
Industrial Engineering Knowledge Center   -
Dr. K.V.S.S. Narayana Rao, Professor, National Institute of Industrial Engineering

Zero Defect

Zero defect comes out of minimizing the variation in manufacturing and related processes. Six sigma is the new technique that was developed to achieve this objective. Zero defect was aimed at in Japanese companies and Poka Yoke technique was contributed by Japanese Industrial Engineering Expert Shigeo Shingo. Zero defects programs were also launched in USA in 1962. Philip Crosby was the leader of this initiative. He develop the cost of quality concept and advocated that manufacturing quality can be improvement by planning and prevention activities and the expenditure spend to improve these activities will be recovered and profit realized through the saving of the cost presently being spent on inspecting, scrapping and reworking. Quality is free was his message. Quality improvement is a cost reduction technique first and through it company can also increase its sales as customers get more consistent products. But six sigma as a technique helps in redesign of processes by specifying target values for various process parameters that give minimum variance for the overall process. Six sigma is a process improvement technique that gives minimum variances as a design feature of the production system.

Zero Effect

Our environment is deteriorating due to our production processes. This deterioration is causing problems to us in our daily life in terms increases temperatures, unpredictable rainfalls, increasiing sea water level, pollution of air and water etc. So, our production processes have to be redesigned to reduce this negative impact on environment. Now, we realize that we have to make impact on environment a major issue to be analyzed each production unit and also make laws to limit that impact. The productivity movement has to recognize that production systems will be redesigned to take care of environmental impact. But the pollution prevention and pollution treatment solutions can be analyzed by the productivity specialists to find out inefficiencies in the solutions proposed and make them more efficient. So productivity specialist or analysts who are presently analyzing production processes have to analyze the pollution prevention and treatment solution also with their methods make them more productive so that we reach zero effect on environment situation as early as possible.

Environmental Mission Statements of Companies


Nemoto and Co. Ltd. Japan

National productivity week 2015 Theme: Zero Defect Zero Effect Presentation

Professor, NITIE
Industrial Engineering Knowledge Center

Theme of the Year

Zero Defect – Zero Effect.

Given by Honourable Prime Minister Narendra Modi during Independence Day Speech on 15 August 2015.

President of USA Lyndon Johnson gave a  similar call for Zero Defects in 1964.


Important performance dimension of industrial and business units.

Effectiveness and Efficiency

Effectiveness – Producing to the requirements of customers

Efficiency -  Less Consumption of Resources.

Managers and Engineers have to be effective and efficient.

Productivity – Alternative Terms


Waste elimination

Cost Reduction/Cost Management

Optimization of Resources

Productivity Measurement

Single factor
Labour productivity
Machine hour productivity

Partial productivity or multifactor productivity
Cost per passenger kilometer

Total factor productivity

Productivity Improvement - Areas

Technical processes
Material handling
Business processes
Marketing and sales, purchasing, cash payment-collection and accounting
Managerial processes
Planning, organizing, staffing, directing and controlling in various functional areas of management
Other processes

Productivity Improvement - Methods

Technology improvement
Product design improvement
Operator method improvement
Equipment improvement
Improvement of planning
Improvement of control – Statistical process control
Improvement of behavioural aspects – Motivation and leadership
Improvement of culture – beliefs and values

Toyota’s Special Effort in Productivity

1945 – Production of cars per worker in Toyota 2 per year.
- In USA  it was 20 per year
By 1965 Toyota’s productivity surpassed that of USA.
At peak Toyota made 100 cars per worker per year. USA companies reached 50 cars per worker per year.
Today Toyota is number one car manufacturer of the world.
Toyota’s productivity improvement was a legend.
World is trying to implement Toyota systems under titles such as World Class Manufacturing.

National Productivity Council

Part of Productivity councils all over the world.
Asian Productivity Organization

State productivity councils are also there.

Publishes Productivity Magazine – Quarterly

Gives productivity awards.

Industrial Engineering

Managers and Engineers have to be effective and efficient.
Engineers have to understand customer requirements and then only design products.
Processes have to be designed to produce as per the design specification.
Products and processes have to consume less resources.
Managers and engineers have the basic responsibility to design products and processes that are effective and efficient.

Industrial Engineering (IE) Focuses on Efficiency

Industrial engineering as a discipline focuses on efficiency.

As a subject and discipline, it evolved out of the thinking of F.W. Taylor

In Art of Metal Cutting, Taylor developed science of metal cutting and increased cutting speeds of machining by 100%.
Then he developed science of manual working in some occupations and increased productivity per worker.

Industrial Engineering - Applicability

Industrial engineering is applicable in all branches of engineering and science.

It is applied now to products as well as processes.

All engineers must be taught basics of industrial engineering in their curriculum.

All engineers and managers have to be encouraged to utilize industrial engineers to further improve the efficiency of the products and processes.

Industrial Engineering – Some Principles

Science has to be developed by management for each activity of the industrial concern.
Operators have to be selected on the basis of science.
Operators have to be trained in production methods developed on the basis of science.
There has to be cooperation between management and operators and management is responsible for production activities that it is best suited.
Best methods can be identified at any point in time.
Once a best method is identified, every operator must be trained and provided with tools to use the best method only.

Industrial Engineering - Definition

Industrial engineering is human effort engineering and system efficiency engineering. – Narayana Rao.

It is an engineering based management subject or discipline.

The objectives of IE are productivity or optimized cost, worker comfort, health, safety and high income.

Industrial Engineering Methods

Human Effort Engineering

Motion Study
Work Measurement
Job Evaluation
Wage Incentives
Operator training

Industrial Engineering Methods

System Efficiency Engineering

Methods efficiency engineering (Method study, Operation analysis)
Product design efficiency engineering (Value engineering)
Operations Research
Engineering Economics (Capital expenditure productivity and operation expenditure productivity)
Six Sigma
Zero Defects (Poka Yoke)

Industrial Engineering Tools

Process charts
Stop watch
Excel solver
Rating systems
Physiology testing equipment
Relative cost tables
Engineering knowledge bases

Industrial Engineering Strategy

Suggested Strategic Decisions

1. What is your productivity/Efficiency Improvement - Cost Reduction goal?

2. Are you planning to realize experience curve effect benefits?

3. How much of the cost reduction - productivity improvement should come from specialist industrial engineers and other engineers and managers?

4. What will be the ratio of industrial engineers to other engineers and managers?

IE Strategic Decisions

5. What bottlenecks or limiting factors have you identified in your facilities?

6. What techniques are going to receive special emphasis?

7. What is your training plan for specialist industrial engineers and other engineers and managers?

8. What is the top management attention to industrial engineering - productivity improvement - cost reduction activity?

9. What is the research and development budget for IE activity?


Government of India established NITIE in 1963.

National Institute of Industrial Engineering.

There is Post graduate programme in IE and also Phd level research in IE.

Publishes Udyog Pragati magazine

Specialized in Industry Training Programmes.

Zero Defects

Defects are waste.

Productivity improvement efforts have a focus on decreasing defects for a long time.

In the case of some machines subject to setup, statistical process control method was developed to indicate when the setup needs to be re-setup.

Inspection to assure quality product

Inspection became an important compulsory activity in production processes.

Only Inspected products are sent to customers.

In companies incoming inspection also became a routine compulsory process.

Production became lax thinking that if some defectives are there, inspectors will find them.

Zero Defects Programme in USA

Launched in USA to impress upon production workers to aim at producing defect free products.

“Mistake happen once in a while” is a belief of many operators.

Zero defects programme were launched to change this belief.

Do it right the first time became the slogan.

Error Cause Removal

Error cause removal was added as an additional component of zero defects programmes.

Operators can point out shortcomings of equipment or facilities that are causing defects.

Supervisors and management take the responsibility to remove the causes of errors.

JIT of Toyota

Toyota wanted to eliminate waste and reduce the cost of its cars.

Inventory appeared to be a waste to them.

Reduce inventories became the concept.

From it came the need for reducing setup time and defects.

Zero defects became the goal.

Shigeo Shingo

Shigeo Shingo is a great Japanese industrial engineer.

He focused on improving technical processes to improve productivity.

Shingo learned the statistical quality and process control techniques taught by Deming and Juran.

They did not satisfy him as they are not zero defect programmes.

He came out with poka yoke to remind the operator that an error has been committed in the process. Operator has to correct his omission or commission for the process to continue.

Root Cause Analysis

Error cause removal became root cause analysis in Japanese practice.

Root cause analysis said correct the cause of error that is present five steps ahead in the process.

It actually said eliminate error causes not only in the current operation but in all five operations ahead of the current operation.

So eliminating the causes of errors deep in the process became the principle.

Zero Defects Programmes in Japan – A Success

We are here becoming aware of the best practices of companies far from us.

Many of us have not actually seen them. But we are reading about them in books and articles. May be now we can see them in YouTube videos.

But the Japanese encouraged plant visits as training devices.

Toyota is always open to visitors. There are Japanese companies now in India also. They can be visited to understand their productivity practices.

Quality is Free – Philip Crosby

Philip Crosby worked in USA in Pershing missile project whose success gave rise to the concept of zero defects.

He says zero defects programmes are free to organizations.

Zero defect programmes give savings by reducing defects and the savings will be more than the investment in zero defect programmes.

Quality cost framework proposed by Crosby has become very popular.

Zero Effect

Weihrich, Cannice and Koontz in their book Management, 13th Edition.

Managers are responsible for ecology maintenance.

A variety of legislation has been passed dealing with solid waste, water and air pollution.

Managers must incorporate all these laws and regulations into their organizational working.

ISO - 14001

ISO (International Standards Organization) developed ISO 14001 to assure that company policies address a variety of public concerns, including pollution prevention and compliance with laws and regulations.

The standard was adopted in 1996.

Now 250,000 organizations in 160 countries are certified under it.

The standard is under revision and will be completed by end of 2015.

Panasonic – Zero Effect Vision

Eco-Conscious Initiatives
Green Plant 2018
Panasonic has a vision to become the No. 1 Green Innovation Company in the Electronics Industry by 2018, when Panasonic will celebrate its 100th anniversary.
Panasonic aspires for global excellence as a Green Innovation Company, encompassing two goals: Green Life Innovation to realize green lifestyles that enrich people's lives and Green Business Innovation to produce further innovation in our business styles.
Over the life of a product — from design concept to its useful end of life — manufacturing can often have the biggest impact on the environment.

Panasonic is committed to minimizing the environmental impacts from the manufacturing process (Zero effect).
Panasonic's initiatives
All Panasonic products, including mobile computers, flat-panel displays, DVD players, digital cameras and cellular telephones, are built using lead-free soldering.
Use of plastic resins are kept to a minimum to facilitate easier recycling.
By combining more effective use of our limited resources with recycling-oriented manufacturing, Panasonic contributes to the development of a sustainable society.
Panasonic further aims to reduce its environmental impact to as close to zero as possible in all of our factories worldwide.
Specifically targeted are a reduction in factories' CO2 emissions, total waste generation, and chemical substance releases.

Jorgen Randers

He is the author of “The Limits to the Growth” in 1972.
He wrote in 2012, “2052: A Global Forecast for the Next Forty Years.”
He is totally unhappy with what was achieved in the last 40 years.

According to him, people in developed countries are not investing the right amounts in environmental management.
That will have serious consequences and it will be more costly to take care of it later instead of now.

Our Prime Minister’s Appeal

Let us take our prime minister’s appeal more seriously and use our brain, brawn and bank balances to understand and prevent this ecological damage caused by our engineering processes and other processes.

We progressed a lot in science and engineering.

If we are committed at thought level, further action will follow.

Remember Knowledge increases, Attitude changes and then Behaviour Changes.

National Productivity Week 2015

Let us get back to our main issue.

Productivity Improvement.

We have Principles, Methods and Tools.

Research and Development is continuously going on and new principles, methods and tools are coming into existence all the time.

Let us adopt them and increase the productivity of our organization first and then become a role model for others.

Prosperity for us through Productivity

Remember our per capita income will increase only when productivity per person improves.

Prosperity for us comes through productivity improvement.

Take one more step to improve productivity and keep taking steps.

Continuous improvement is the motto of the current times.

Thank You.

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