Eric Johnson makes billiard balls in his New England plant. With recent increases in his costs, he has a new-found interest in efficiency. Eric is interested in determining the productivity of his organization. He would like to know if his organization is maintaining the manufacturing average of 3% increase in productivity. He has the following data:
Last YearNow
Units Produced1,0001,000
Labor (hours)300275
Resin (pounds)5045
Capital invested ($)10,00011,000
Energy (BTU)3,0002,850
Show the productivity change for each category and then determine the improvement for labor-hours, the typical standard for comparison.
Also, if Eric determines his costs to be as follows:
Labor $10 per hour
Resin $5 per pound
Capital 1% per month of investment
Energy $.50 per BTU
Show the productivity change, for one month last year versus one month this year, on a multifactor basis with dollars as the common denominator.