J & L Products produces cast bronze valves for use in offshore oil platforms. Latest data indicates that J & L produces 1,800 valves per day. The 24 workers at J & L work from 7:00 a.m. until 4:00 p.m., with 30 minutes off for lunch and a 15-minute break during the morning work session and another break at the afternoon work session. This is a competitive industry, and management needs to increase productivity to maintain a competitive advantage. They feel that a 20% increase is needed based on new marketing forecasts.
The J & L operations management team believes that the 20% increase will not be possible without a change in working conditions so they decided to change work hours. The new schedule will have the workers report to work from 7:30 a.m. until 4:30 p.m., during which workers can take one hour off at any time of their choosing. Obviously, the number of paid hours is the same as before, but production increases, perhaps because workers are given a bit more control over their workday. After this change, valve production increased to 2,050 units per day.
Calculate labor productivity for the initial situation.
Calculate the daily valve production for the hypothetical 20% increase.
What is the productivity after the change in work time?
Assess the results achieved in a short narrative.