1. Linear Programming Technical Supplement 3 Learning Curves Copyright © 2014 by the McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

2. Objectives 1.Explain the learning curve concept 2.Identify different uses of learning curves in operations management 3.Calculate the estimated time required to do a task for a given learning curve TS3-2

3. Concepts Learning curve is an equation that can be used to estimate a rate of improvement in tasks Resource needs are reduced as people learn through repetition –Time to assemble a product –Cost to fabricate an item Resource requirement is reduced by certain percentage each time cumulative output is doubled Overview of Learning Curves TS3-3

4. The Learning Curve T n = T 1 (n b ) Where: T n = time required to complete the nth task r = learning rate percentage b = ln(r)/ln(2) TS3-4

5. Example T 1 = 100 minutes T 2 = 80 minutes T 4 = 64 minutes What would be the time required to produce the eighth part? T 8 = (100)(8 -0.322 ) = 51.2 minutes since b= ln(0.80)/ln(2) = -0.322 TS3-5

6. Learning Curve Table TS3-6

7. Factors that Impact Learning Rate Incentives and rewards Supporting resources for experimentation Training Tools and technology Culture TS3-7

8. How OM Managers Use Learning Curves Setting goals and expectations Capacity planning Costing Changes to product and process designs TS3-8

9. Summary Learning curve estimation is a powerful planning tool –Helps to identify resources needed to accomplish a production program –Can be used to set goals and assess progress Wide application given that underlying drivers of learning are present TS3-9