Learning Curve Concept The concept of learning is based on the fact that a person improves his skills with practice. Every person who is putting his labour tries to gain experience over a period to reduce the time for each job in labour intensive jobs.

Learning Theory What the learner brings to the transactions What the leader/supervisor brings to the transactions The learning background in terms of technical, and human skills Man machine interactions Conditions necessary for improvements Utilisation of learning in the worklife of the learner Process of continued learning

Learning factor The learning factor is based on the principle that all jobs are performed more efficiently with more experience. Learning factor depends on the type of industry and past experience. – Electrical & electronics industry 90% – Engines manufacturing 85% – Machinery 95%

Learning Curve Learning curve is obtained by plotting the cumulative number of units on the x-axis and the cumulative time of the values obtained as above on the y-axis.

Learning Curve Duncan Williamson April 2001

Time Knowledge of Skill Typical Learning Curve

Knowledge of Skill Confusion Time

Typical Learning Curve Knowledge of Skill Clarity Time

Typical Learning Curve Knowledge of Skill Competence Time

Typical Learning Curve Knowledge of Skill Confidence Time

Mathematical approach Learning calculations can be worked out on the basis of a mathematical formula. T(q) = Hq^(1-h) Where, ‘T(q)’ represents the cumulative time for q units, ‘h’ is the learning factor between 0 and 1, ‘H’ is the time for manufacturing the first unit

Uses of a Learning Curve Useful for negotiating the price by isolating the material costs and applying the learning factor for labour intensive jobs. Vendors, who are scientific minded, also plot their own learning curves for labour intensive activities and use them in negotiation process after giving the breakdown of material, labour, overhead and profit.

Limitations in use Learning curve should be used when – Proprietary factors limit competition – Tooling is expensive – Specialised know-how is involved – Direct labour is substantial portion of product cost Application of learning curve is only for non standard items – it changes from item to item