Business Ethics – Introduction


Morality can be defined as the standards that an individual or a group has about what is right and wrong or good and evil.
How to distinguish moral standards from standards that are not moral?
Ethicists suggested five characteristics to identify moral standards.
1. Moral standards deal with matters which people think can seriously injure or seriously benefit human beings.
2. Moral standards are not established or changed by political or legal authoritative bodies. The validity of moral standards rests on the adequacy of the reasons.
3. Moral standards are preferred to other standards including even self-interest when choice is there.
4. Moral standards are impartial. They are based on impartial reasons that an impartial observer would accept.
5. Moral standards are associated with special emotions. When people act in violation of a moral standard, they feel guilty, ashamed and remorseful.


Ethics is the activity of examining the moral standards of a society or of an individual. Whether the standards are reasonable or not and how to apply the standard in particular situations are examined by ethicists. The aim of ethics is develop a body of moral standards that a person feels reasonable to hold based on careful thought.

Business Ethics

Business ethics is an enquiry of ethics in the field of business. It concentrates on moral standards that the system of business, business organizations, and individuals with in the business organizations and individuals who deal with business organizations have to evaluate and follow in their day to day dealings and decisions.
Business ethics can be studied at three levels: systemic, corporate and individual. Systemic issues deal with economic, political, legal and other related systems within which production and distribution activities are carried out. Questions related to the morality of capitalism, regulation of business etc. fall into this level. Corporate level issues deal with actions of corporate concerns or corporate citizens.
Individual levels issues deal with every individual working in a business firm and it can include customers/consumers.

Do Moral Standards Apply to Corporations?

While some people do argue that corporations have no moral standards to adhere to and only people have. Velasquez concludes that as corporate citizens they have moral standards to live up to but at the same time they are mainly acted upon by people. People are behind corporate decisions.

Moral Development

Lawrence Kohlberg proposed that a person’s ability to deal with moral issues develops in six identifiable stages.
Stage 1: For child, the physical consequences determine the goodness or badness of an act.
Stage 2: Right activities are those that satisfy the needs of the child or the needs of persons he cares about.
Stage 3: Good behavior is living up to the expectations of the group of people one loves or trusts such as family or friends.
Stage 4: At more mature stage law is followed for determining right or wrong acts.
Stage 5: Conflicting personal views are recognized.
Stage 6: Moral principles are chosen because of their logical comprehensiveness in ethics enquiry.

Moral Reasoning

Moral reasoning is the process by which actions are judged with reference to moral standards. It involves knowledge of moral standard and whether a situation has arisen wherein moral standard needs to be applied.
Moral reasoning has to be logical. The factual evidence regarding the situation must be accurate, relevant and complete. The set of moral standards invoked has to be consistent.

Arguments For and Against Business Ethics

Arguments against Business Ethics

1. The pursuit of profit will by itself ensure social responsible behavior in perfectly competitive markets.
2. Managers are loyal agents and they should pursue the interests of their firms and should ignore ethical considerations.
3. It is sufficient if business firms obey law.

Arguments for Expecting Ethical Behavior from Business Concerns

1. Businesses cannot survive unless moral standards exist in business concerns and outside.
2. Ethical concerns are consistent with profits of businesses.
3. Analogy to Prisoners’ dilemma problem reveals that in repeated interactions, cooperation is the best solution and ethical behavior is the best solution.
4. Most people value ethical behavior and punish business men and organizations that are not ethical. In organizations, where people feel there is no fair play, there is more absenteeism, avoidance of work and lack of respect. In organizations where people feel there is fair play, there is enthusiasm, cooperation and trust.
Main source:

Manuel G. Velasquez, Business Ethics: Concepts and Cases, Fourth Edition,  Prentice Hall Inc., Upper Saddle River, N.J., 1998, Business Ethis by Manuel G. Velasquez - Book Information and Review


Business Ethics: The new bottom line
Full view Google book http://books.google.co.in/books?id=SgNtH27P5PcC

Originally posted in
http://knol.google.com/k/narayana-rao/business-ethics-introduction/2utb2lsm2k7a/ 1373#

Moral Standards and Moral Judgments – Approaches

Velasquez discussed four approaches in his chapter “Ethical Principles in Business.”

Approach of Utilitarianism

The action that has highest net social benefit is to be undertaken when we do not have the resources for attaining everyone’s objectives. Jeremy Bentham is its proponent.

Principle of Rights

Any behavior by an individual or a group should respect the basic rights of the individual affected by the action. Special agreements also create rights.

Principle of Justice

Standards of justice indicate how benefits and burdens should be distributed among the members of a group. These standards are to be utilized when activities and benefits different substantially among members in important ways. Capitalism and Socialism differ in the principle of justice regarding duties and rewards of members of a society.

Principle of Care

Every person has some special concrete relationships with others.  He has to take care of them in preference to others or some of his own objectives. A parent has a responsibility to take care of his children even at the expense of his future or career.


Manuel G. Velasquez, Business Ethics: Concepts and Cases, Fourth Edition, Prentice Hall Inc., Upper Saddle River, N.J., 1998, Business Ethis by Manuel G. Velasquez - Book Information and Review

Originally published in
http://knol.google.com/k/narayana-rao/moral-standards-and-moral-judgments/ 2utb2lsm2k7a/ 1383#

Business System - Free Markets - Ethics

Free market system may have variety of competitive market systems depending on the product life cycle and competitive situation in a product market (industry). Perfect competition, oligopoly, duopoly, and monopoly are some of the types.

Perfect competition

In a perfectly competitiive market, there are numerous buyers and sellers and none of them will have sizeable market share. Entry and exit of buyers and sellers is free. In a perfectly competitive market, prices and quantities always move toward the equilibrium point.

Velasquez wrote, perfectly competitive free market achieves or satisfies three moral criteria: Justice, Utility and Rights.

Capitalist criterion of justice: Benefits and burdens are distributed justly when a person receives in return at least the value of the contribution he or she made to an enterprise. Fairness is getting paid fully, in return for what one contributes. It is this form of justice (capitalist criterion of justice) that is achieved in perfectly free competitive markets.


Unregulated monopoly markets can fall short of the three values - capitalist justice, economic efficiency, and respect for negative rights that perfect competitive markets achieve.


Oligopoly also can result in shortfall of the three values: capitalist justice, economic efficiency, and respect for negative rights that perfect competitive markets achieve. In oligopoly markets price-fixing, manipulation of supply, exclusive dealing arrangements, tying arrangements, retail price maintenance arrangements, price discrimination are identified as unethical practices.


Manuel G. Velasquez, Business Ethics: Concepts and Cases, Fourth Edition, Prentice Hall Inc., Upper Saddle River, N.J., 1998, Business Ethis by Manuel G. Velasquez - Book Information and Review

First published in

What is Strategy? Review Notes

A company's strategy consists of business approaches and competitive moves that top managers employ to attract and please customers, compete successfully, and achieve organizational objectives.

In crafting a strategy, the management declares, among all the paths and actions available to us, we have decided to focus on these customer needs and markets, compete in this fashion, allocate our resources and energies in these ways, and rely on these particular approaches to doing business. A strategy is managerial choice among alternatives adn signals organizational commitment to specific products and services, markets, competitive approaches, and ways of operating.

Business model is the term now widely applied to the revenue - cost detail of a firm. This provides the actual revenue streams through various products and services and the associated cost stream, profit margins and return on Investment. This model is provided for future estimates also. Every strategic alternative is to be converted into business model and checked for its profitability.

Five Tasks of Strategic Management

1. Forming the vision for the future. Where we want to be in the next 10 years in line with our objectives and mission.

2. Setting Goals for the near planning period - Converting the 10 years vision into current year goals.

3. Crafting a strategy to achieve the goals in the current that support the 10-year vision.

4. Organizing the resources in line with the strategy (Implementing the resource acquisition and allocation strategy).
5. Execution: Evaluating the daily performance and assessing its impact on annual plan and initiating adjustments in department levels plans as well as company level plans.

Crafting Executing Strategy: Text and Readings
Thomspon and Strickland, 12th Edition, 2001

Prof Rumelt on Strategy - Video Interview


Building Resource Strengths and Organizational Capabilities - Review Notes

Based on Thompson and Strickland's Book

Implementing and executing strategy involves technology organization, resource acquisition, people organization, staffing, management of people and business processes. The managerial emphasis is on converting strategic plans into actions and good results.

The starting point for managers to start in implementing and executing a new or different strategy is a list of activities which the organization has to do differently from now onwards to achieve the strategic goals in the time frame envisaged. Then, the necessary steps to make the internal changes have to be instituted as early as possible.

Top-level managers have to rely on the middle and lower managers to understand and develop their unit levels plans to support strategy and explain strategy changes and related business process changes to department members and see that the organization actually operates in accordance with the strategy at department levels. Every step in the organization has certain people questioning it and the middle and lower managers must have the understanding to explain and persuade people to follow strategy .

Thompson and Strickland described eight managerial tasks as cropping up repeatedly in company efforts to execute strategy:

1. Building an organization with the competencies, capabilities, and resource strengths to execute strategy successfully.
2. Marshaling people behind the drive for strategy execution.
3. Instituting policies and procedures that facilitate rather than impede strategy execution.
4. Adopting best practices and pushing for continuous improvement in both marketing and operations activities.
5. Installing information and operating systems that enable company personnel to carry out their strategic roles proficiently.
6. Tying rewards directly to the achievement of strategic and financial targets.
7. Shaping the work environment and corporate culture to fit the strategy.
8. Exercising management control to drive execution forward, keep improving on the details of execution, and achieve operating and marketing excellence as rapidly as feasible.

Building an organization capable of good strategy execution involves three dimension: (1) Staff: a talented, can-do team with the needed experience, technical skills, and intellectual capital; (2) Core competencies and competitive capabilities (3) the technology and people organization .

Building core competencies and competitive capabilities is a time-consuming development activity that involves three stages: (1) developing the ability to do something as novice act as a team. (2) Learning from the initial performances, and developing methods to perform the activity consistently well at marketable and profitable costs,, thereby transforming the ability into a tried-and-true business getting competence or capability; and (3) continuing to polish and refine the organization's know-how and otherwise sharpen performance such that it becomes better than competitors at performing the activity, thus raising it to the core competence (or capability) or to the rank of a distinctive competence (or competitively superior capability) and opening an avenue to competitive advantage. Many companies manage to get through stages 1 and 2 but comparatively few achieve sufficient proficiency to qualify for the third stage. The idea of top three in any industry illustrates this idea of many not being able to develop that superiority in competitive scenario.

While competitors can readily duplicate some strategy features, core competencies and capabilities are very difficult or costly for imitations and they give durable competitive edge.


Presentation slides

Conceptual Framework for Modeling Business Capabilities

Corporate Culture and Leadership - Keys to Effective Strategy Execution - Review Notes

Based Chapter of Thompson and Strickland

The beliefs, goals, and practices called for in a strategy may be compatible with a
firm’s culture or they may not. When they are not, a company usually finds it difficult
to implement the strategy successfully. A close culture-strategy match that energizes
People throughout the company to do their jobs in a strategy-supportive manner adds
significantly to the power and effectiveness of strategy execution.

When a company’s culture is out of sync with what is needed for strategic success, the culture has to be changed as rapidly as can be managed. A sizable and prolonged strategy-culture conflict weakens and may even defeat managerial efforts to make the strategy work.
A strong culture and a tight culture-strategy alignment is a powerful lever for channeling behavior and for influencing employees do their jobs in a more strategy-supportive manner.

It is the strategy-maker’s responsibility to understand the company culture, and select a strategy compatible with the “sacred” or unchangeable parts of prevailing corporate culture. He also has to foresee how he is going to change the culture to support the strategy that he is proposing. During the strategy implementation, it is an important task, , once strategy is chosen, to change whatever facets of the corporate culture hinder effective execution.

Changing a company’s culture and aligning it with strategy are among the toughest
management tasks--easier to talk about than do. Thompson and Stickland advocate that managers have to talk openly and forthrightly to all concerned about those aspects of
the culture that have to be changed. The talk has to be followed swiftly by visible
actions to modify the culture-actions that everyone will understand are intended to
establish a new culture more in tune with the strategy.

What makes a spirit of high performance come alive is a complex network of
practices, words, symbols, styles, values, and policies pulling together that produces
extraordinary results with ordinary people.

Presentation slides

Full Chapter (Only culture portion)

Organizational culture - a note

Strategy For Success Needs to be Supported by Culture - Research report by Booz and Company

Video presentations on corporate and company culture





Updated on 31.5.2012

Industrial Engineering - Review Articles

1. Industrial Engineering - Introduction

2. Component Areas of IE: Human Effort engineering and System Efficiency Engineering

Articles are posted in serial order

Pioneering Efforts of Taylor, Gilbreth and Emerson
Principles of Motion Economy
Motion Study - Human Effort Engineering
Ergonomics - Introduction
Work Measurement

Predetermined Motion Time Systems (PMTS)
Methods Efficiency Engineering
Product Design Efficiency Engineering
Plant Layout - Efficiency
Value Engineering - Introduction

Statistical Quality Control – Industrial Engineering
Statistical Quality Control – Industrial Engineeri... (duplicate post - to be removed)
Inspection Methods Efficiency Engineering
Operations Research - An Efficiency Improvement Tool for Industrial Engineers
Engineering Economics is an Efficiency Improvement Tool for Industrial Engineers
Industrial Engineering and Scientific Management in Japan

Shigeo Shingo - The Japanese Industrial Engineer
System Engineering Process and Its Management
Systems Improvement
Systems Installation - Installing Proposed Methods
Productivity, Safety, Comfort, and Operator Health Management

Organizing for Industrial Engineering: Historical Evolution of Thinking
Current Research in IE
Managing Change in Improvement Projects - Comfort Zone to Comfort Zone
Supply Chain Cost Reduction
System Design Principles

Total Improvement Management
Total Industrial Engineering - H. Yamashina

Industrial Engineering - Introduction

Industrial Engineering - Definitions

Industrial engineering directs the efficient conduct of manufacturing, construction, transportation, or even commercial enterprises of any undertaking, indeed in which human labor is directed to accomplishing any kind of work . Industrial engineering has drawn upon mechanical engineering, upon economics, sociology, psychology, philosophy, accountancy, to fuse from these older sciences a distinct body of science of its own . It is the inclusion of the economic and the human elements especially that differentiates industrial engineering from the older established branches of the profession (Going, 1911) [1].

“Industrial engineering is the engineering approach applied to all factors, including the human factor, involved in the production and distribution of products or services.” (Maynard, 1953) [2]

“Industrial engineering is the design of situations for the useful coordination of men, materials and machines in order to achieve desired results in an optimum manner. The unique characteristics of Industrial Engineering center about the consideration of the human factor as it is related to the technical aspects of a situation, and the integration of all factors that influence the overall situation.” (Lehrer, 1954) [3]

“Industrial engineering is concerned with the design, improvement, and installation of integrated systems of men, materials, and equipment. It draws upon specialized knowledge and skill in the mathematical, physical, and social sciences together with the principles and methods of engineering analysis and design, to specify, predict, and evaluate the results to be obtained from such systems.” (AIIE, 1955). [4]

"Industrial engineering may be defined as the art of utilizing scientific principles, psychological data, and physiological information for designing, improving, and integrating industrial, management, and human operating procedures." (Nadler, 1955) [5]

“Industrial engineering is that branch of engineering knowledge and practice which

1. Analyzes, measures, and improves the method of performing the tasks assigned to individuals,

2. Designs and installs better systems of integrating tasks assigned to a group,

3. Specifies, predicts, and evaluates the results obtained.

It does so by applying to materials, equipment and work specialized knowledge and skill in the mathematical and physical sciences and the principles and methods of engineering analysis and design. Since, however, work has to be carried out by people; engineering knowledge needs to be supplemented by knowledge derived from the biological and social sciences.” (Lyndall Urwick, 1963) [6]

"Industrial engineering is concerned with the design, improvement and installation of integrated systems of people, materials, information, equipment and energy. It draws upon specialized knowledge and skill in the mathematical, physical, and social sciences together with the principles and methods of engineering analysis and design, to specify, predict, and evaluate the results to be obtained from such systems." [7]

"Industrial engineering is an art for creating the most efficient system composed of people, matters, energy, and information, by which a specific goal in industrial, economic, or social activities will be achieved within predetermined probabilities and accuracy. The system may be for a small single work station, a group, a section, a department, an institution or for a whole business enterprise. It may be also be of a regional, national, international, or inter-planetary scope."(Sawada, 1977) [8]

“Industrial Engineering is Human Effort Engineering. It is an engineering discipline that deals with the design of human effort in all occupations: agricultural, manufacturing and service. The objectives of Industrial Engineering are optimization of productivity of work-systems and occupational comfort, health, safety and income of persons involved.” (Narayana Rao, 2006) [9]

"Industrial Engineering is Human Effort Engineering and System Efficiency Engineering. It is an engineering discipline that deals with the design of human effort and system efficiency in all occupations: agricultural, manufacturing and service. The objectives of Industrial Engineering are optimization of productivity of work-systems and occupational comfort, health, safety and income of persons involved."(Narayana Rao, 2009) [10]

Total Industrial Engineering is "a system of methods where the performance of labor is maximized by reducing Muri (unnatural operation), Mura (irregular operation) and Muda (non-value added operation), and then separating labor from machinery through the use of sensor techniques." (Yamashina)

( Source: http://wenku.baidu.com/view/a1cdf8ec4afe04a1b071de84.html)

"Industrial Engineering is Human Effort Engineering and System Efficiency Engineering. It is an engineering-based management staff-service discipline that deals with the design of human effort and system efficiency in all occupations: agricultural, manufacturing and service. The objectives of Industrial Engineering are optimization of productivity of work-systems and occupational comfort, health, safety and income of persons involved."(Narayana Rao, 2011) [Added to this knol on 14.9.2011]


1. Going, Charles Buxton, Principles of Industrial Engineering, McGraw-Hill Book Company, New York, 1911, Pages 1,2,3

2. Maynard, H.B., “Industrial Engineering”, Encyclopedia Americana, Americana Corporation, Vol. 15, 1953

3. Lehrer, Robert N., “The Nature of Industrial Engineering,” The Journal of Industrial Engineering, vol.5, No.1, January 1954, Page 4

4. Maynard, H.B., Handbook of Industrial Engineering, 2nd Edition, McGraw Hill, New York, 1963.

5. Nadler, Gerald, Motion and Time Study", McGraw-Hill Book Company, Inc., New York, 1955

6. Urwick, Lyndall, F., “Development of Industrial Engineering”, Chapter 1 in Handbook of Industrial Engineering, H.B. Maynard (Ed.), 2nd Edition, McGraw Hill, New York, 1963.

7. http://www.iienet2.org/Details.aspx?id=282

8. Sawada, P.N., "A Concept of Industrial Engineering," International Journal of Production Research, Vol 15, No. 6, 1977, Pp. 511-22.
9. Narayana Rao, K.V.S.S., “Definition of Industrial Engineering: Suggested Modification.” Udyog Pragati, October-December 2006, Pp. 1-4.
10. Narayana Rao K.V.S.S., Industrial Engineering

Industrial Engineering is a Management Function

Industrial engineering (IE) discipline emerged out of the involvement of engineers in management of engineering departments. It is management function. Frederick Taylor identified the short coming in the shop management that engineers really do not understand how operators are using machines or handtools. It is not proper management of manufacturing activity. Taylor came with the theory that managers have to know how work is to be done by operators and must have the capability to train them. Managers have to specify standard operating procedures. Taylor used time study as the tool to identify the best practices or methods being used by operators at that point in time and based on them developed standard operating procedures that improved productivity. Along with it, Taylor developed theory of various work methods, conducted experiments and came out with improvements in man-machine system productivity. Gilbreth came with a different approach of developing micromotions used by operators to carry any activity. He developed optimal methods by removing certain nonvalue adding micromotions and specifing more optimal micromotions. Harrington Emerson, developed principles of efficiency for manufacturing organizations.

Within the management functions its present focus of industrial engineering is on the design of work done by operators and improvement of efficiency of systems and processes.

In certain companies, IE department was made a part of management services department which was appropriate. Management accounting, Management controls, Management audit, Industrial engineering and some more such similar functions can be organized under management services departments. Such a departmentation clearly recognizes that these sections or functions are functions of management assisting management in planning, organizing and directing resources.


Industrial Engineering in Various Functions of a Business/Industrial Organization

Product Design Industrial Engineering

Maintenance System Industrial Engineering - Online Book

Information Systems Industrial Engineering - Online Book

Financial System Industrial Engineering - Online Book

Marketing System Industrial Engineering - Online Book

Supply Chain Industrial Engineering - Online Book

Manufacturing System Industrial Engineering - Online Book

Total Cost Industrial Engineering - Industrial Engineering of Enterprise Cost

Quality System Industrial Engineering


Component Areas of IE: Human Effort engineering and System Efficiency Engineering

"Industrial Engineering is human effort engineering and system efficiency engineering."
This statement appeared in IIE magazine "Industrial Engineer" in March 2010 issue.

The following subjects or techniques form part of industrial engineering tool kit.

Human Effort Engineering

1. Principles of Motion Economy and Motion Study.
Therbligs, SIMO chart, Chronocycle graph
2. Work Measurement
Stop watch time study, worksampling, PMTS - MTM, MOST
3. Ergonomics

4. Safe Work Practice Design
Personal protective devices

5. Wage Incentives and Job Evaluation

System Efficiency Engineering

1. Method Study and Methods Efficiency Design
Process analysis, operation analysis, work station design
2. Value Engineering

3. Statistics Based Techniques: Statistical Quality Control (SQC), Statistical Process Control (SPC), and Six Sigma Projects etc.

4. Mathematical Optimization, Operations Research and Quantitative Techniques
Linear programming models, Integer programming, Non-linear programming
5. Plant Layout Studies for reduction of material movement, operator movement and movement of salesmen etc.

6. Engineering Economics
Engineering Economic Appraisals of projects submitted by Engineering Departments

7. Specialised Functional IE Solutions: SMED. Lean Manufacturing, BPR


Knols (Online Articles on these topics)

Industrial Engineering of Systems - System Industrial Engineering

Human Effort Engineering

Human Effort Engineering

1. Principles of Motion Economy and Motion Study.
Therbligs, SIMO chart, Chronocycle graph

Work Station Design - An Activity of Human Effort Engineering
Principles of Motion Economy
Motion Study - Human Effort Engineering
Motion Study - Operation Analysis - Questions

2. Work Measurement
Stop watch time study, worksampling, PMTS - MTM, MOST
3. Ergonomics

Ergonomics - Introduction

4. Safe Work Practice Design
Personal protective devices

Safety Aspect of Human Effort Engineering - A Manual to Support
Safety Gloves

5. Wage Incentives and Job Evaluation

Job Evaluation - Purpose - Consultants

System Efficiency Engineering

Systems Efficiency Engineering - A Focus Area of Industrial Engineeering
System Efficiency Engineering - Methods, Subjects, Techniques, and Tools

1. Method Study and Methods Design
Process analysis, operation analysis, work station design

Method Study
Process Analysis - Questions/Check List

2. Value Engineering

Value Engineering - Introduction
Value Engineering at the Design and Development Stage - Tata Nano Example
Value Engineering - Examples, Cases and Benefits

3. Statistics Based Techniques: Statistical Quality Control (SQC), Statistical Process Control (SPC), and Six Sigma Projects etc.

Statistical Quality Control – Industrial Engineering

4. Operations Research and Quantitative Techniques
Linear programming models, Integer programming, Non-linear programming

Operations Research - An Efficiency Improvement Tool for Industrial Engineers

5. Plant Layout Studies for reduction of material movement, operator movement and movement of salesmen etc.

6. Engineering Economics
Engineering Economic Appraisals of projects submitted by Engineering Departments

Engineering Economy or Engineering Economics: Economic Decision Making by Engineers
Introduction to Engineering Economics
Engineering Economics is an Efficiency Improvement Tool for Industrial Engineers
Engineering Economics and Industrial Engineering
Engineering Economic Appraisal by Industrial Engineering Department
Time Value of Money
Chemical Engineering Economics
Civil Engineering Economics or Economy
Electrical Engineering Economics
Engineering Economics - Books and Contents
Present-Worth Comparisons
Replacement Problem - Engineering Economy Analysis
Engineering Economic Analysis - Case Studies
Engineering Economics or Economy - Typical Problems
Machine Selection Problem for an Engineer - Engineering Economic Analysis
Selection of Motor - A Design Engineer's Problem - Engineering Economic Analysis

7. Specialised Functional IE Solutions: SMED. Lean Manufacturing

SMED - Single Minute Exchange of Dies - An Industrial Engineering Innovation
5S System - Work Place Design (Industrial Engineering)

Related Knols

Industrial Engineering Tool Kit - Recommended Books
Industrial Engineering Tool Kit - Videos - Video Knol Collection

Introduction to Industrial Engineering - Course at NITIE
Industrial Engineering
Industrial Engineering - Knols of Narayana Rao K V S S


Related Papers and Articles

IE Tool Kit in Hospitaable Food Service Sites.
IE magazine article, 2010
Operation Research Methodologies in Industrial Engineering: A Survey
Authors: Robert E. Shannona; S. Scott Longb; Billy P. Bucklesa
IIE Transactions, Volume 12, Issue 4 December 1980 , pages 364 - 367

Industrial Engineering Job Description - Boeing


Pioneering Efforts of Taylor, Gilbreth and Emerson

Taylor developed efficient methods, advocated scientific management that advocated study of work by engineers and shop managers. He also developed stop watch time study.

Frank B. Gilbreth, the engineer who conceived the "Motion Study" Principles (techniques for manual productivity improvement) once visited a British-Japanese Exposition. There a demonstration of polishing shoes was being held to help the sales of Japanese shoe polish.
Casually walking and talking with his friend, Gilbreth stopped to view the shoe polish wrapping demonstration. Gilbreth watched for a few moments, then simply said, "They are really skilled, but they could produce more." He timed the fastest girl and without hesitation, ascended the platform. He found she was being paid on a piecework basis and said, "I’m going to tell you how to earn more money, but you must follow my instructions." He changed the location of her supplies and showed her how to wrap and set aside more efficiently. He timed her again after several cycles. When he rejoined his friend he said, "When she gets the hang of it she’ll be making twice her former earnings."

That is an example of the applied results of using Gilbreth’s Motion Study Principles. Industrial Engineers used these guiding rules throughout the United States. Gilbreth said if his Motion Study Principles had not been previously applied to any manual work, by their application the productivity would be doubled or more.

In the late 1940’s, James S. Perkins, an Industrial Engineer, on a research assignment for the Western Electric Company, was at the University of Iowa, where he met Mrs. Gilbreth, who was a speaker at the Industrial Engineering Conference there. She visited with him and reviewed his research. Gilbreth’s film studies, research and conclusions, preserved by James Perkins extend into many diverse areas:

•Motion and Fatigue Study
•Skill Study
•Plant Layout and Material Handling
•Inventory Control
•Production Control
•Business Procedures
•Safety Methods
•Developing Occupations for the Handicapped
•Athletic Training and Skills
•Military Training
•Surgical Operations
Gilbreth developed the route model technique to improve the flow of materials in manufacturing operations. When he first developed it, Gilbreth said that several of his engineering friends, at an engineering meeting, laughed themselves to death, but that it was quickly accepted by Plant Managers. He found that by its use, the layout distance was often cut by 75% and product processing time was reduced substantially. Further, plant productivity was usually increased by 15 to 25%.

Gilbreth’s cyclegraph technique, to learn about skill, was one of his significant contributions. He demonstrates this technique in the film and also shows the three-dimensional model he made from the pictures of a drilling operation. He said, "The expert uses the motion model for learning the existing motion path and the possible lines for improvement. An efficient and skillful motion has smoothness, grace, strong marks of habit, decision, lack of hesitation and is not fatiguing."

Harrington Emerson contributed to the systems efficiency focus of industrial engineering. His book Twelve Principles of Efficiency was classic.

He discussed efficiency design of organization through 12 principles

1. Clearly defined ideals.
2. Common sense
3. Competent counsel
4. Discipline
5. The fair deal
6. Reliable, immediate and adequate records
7. Despatching
8. Standards and schedules
9. Standardized conditions
10. Standardized operations
11. Written standard-practice instructions
12. Efficiency-reward

Standards and standardization as a basis for efficiency was strongly advocated by him. Nearly two hundred companies adopted various features of the Emerson Efficiency system, which included production routing procedures, standardized working conditions and tasks, time and motion studies, and a bonus plan which raised workers' wages in accordance with greater efficiency and productivity [Guide].

Principles of Motion Economy

Industrial Engineering Article Series
Principles of Motion Economy are to be used in motion design, motion analysis, motion study of human operators. Motion design is a technique of Human Effort Engineering, a core focus area of Industrial Engineering. They can also be used in robot motion design.


Use of the Human Body

1. The two hands should begin as well as complete their motions at the same time.

2. The two hands should not be idle at the same time except during rest periods.

3. Motions of the arms should be made in opposite and symmetrical directions and should be made simultaneously.

4. Hand and body motions should be confined to the lowest classification with which it is possible to perform the work satisfactorily.

5. Momentum should be employed to assist the worker wherever possible, and it should be reduced to a minimum if it must be overcome by muscular effort.

6. Smooth continuous motion of the hands are preferable to straight line motions involving sudden and sharp changes in direction.

7. Ballistic movements are faster, easier and more accurate than restricted (fixation) or controlled movements.

8. Work should be arranged to permit an easy and natural rhythm wherever possible.

9. Eye fixations should be as few and as close together as possible.

Arrangement of the workplace

10. There should be a definite and fixed place for all tools and materials.

11. Tools, materials and controls should be located close to the point of use.

12. Gravity feed bins and containers should be used to deliver material close to the point of use.

13. Drop deliveries should be used wherever possible.

14. Materials and tools should be located to permit the best sequence of motions.

15. Provisions should be made for adequate conditions for seeing. Good illumination is the first requirement for satisfactory visual perception.

16. The height of the work place and the chair should preferably arranged so that alternate sitting and standing at work are easily possible.

17. A chair of the type and height to permit good posture should be provided for every worker.

Design of tools and equipment

18. The hands should be relieved of all work that can be done more advantageously by a jig, a fixture, or a foot-operated device.

19. Two or more tools should be combined wherever possible.

20. Tools and materials should be prepositioned whenever possible.

21. Where each finger performs some specific movement, such as in typewriting, the load should be distributed in accordance with the inherent capacities of the fingers.

22. Levers, hand wheels and other controls should be located in such positions that the operator can manipulate them with the least change in body position and with the greatest speed and ease.


Ralph M. Barnes, Motion and Time Study Measurment of Work, John Wiley & Sons, New York, 1980

______________ ______________
More Details in
Principles of Motion Economy - Some More Details


Related content
Industrial Engineering Knowledge Center

Originally posted at
http://knol.google.com/k/ principles-of-motion-economy

Motion Study - Human Effort Engineering

Purpose: The goal of motion study is to enhance work performance (quantity and quality of output) through analysis and improvement of body and hand movements. Motion study can be thought of system improvement at a micro level [1] and is a part of human effort engineering.

In the contemporary work environment, motion study also involves reducing the ergonomic stresses associated with a job. This reduces costs (medical treatment and time lost) associated with work injuries. It may also reduce production losses associated with hiring and training replacement workers as well as rehabilitation of persons with work-related injuries.

Principles of motion economy are utilized in motion study. A modified list of principles given by  Mullee and Porter [2] are:

1. Begin each element simultaneously both hands.
2. End each element simultaneously with both hands.
3. Use simultaneous arm motions, in opposite and symmetrical directions.
4. use had motions of lowest classification for satisfactory operations.
5. Keep motion path within normal working area.
6. Avoid share changes of direction. Plan a smoothly curved motion path.
7. Slide small objects. Avoid pickup and carry
8. Locate tools and materials in proper sequence, at fixed work stations.
9. Use fewest elements to obtain shortest time.
10. Use rhythm and automaticity to increase output and lessen fatigue.
11. Relieve both hands with foot pedals where possible.
12. Avoid holding. Use vise or fixture, freeing hands to move pieces.
13. Provide ejectors to remove finished pieces.
14. Use drop deliver where possible.
15. Shorten transports by keeping materials nearby in gravity-feed hoppers.
16. Pre-position tools for quick grasp.
17. Pre-position product for next operation.
18. Locate machine controls nearby for each of operation.
19. Design workplace height of sitting-standing arrangement, and provide proper height chair with comfortable seat and backrest for good posture.
20. Provide pleasant working conditions considering illumination, temperature, humidity, dust, fumes, ventilation, noise level, color scheme, orderliness, and the like.

Right- and Left Hand Chart [2]

In this chart, the activities of the right and left hand are expressed as operations, transportations or moves, holds, and delays and these are represented by the flow-process chart symbols. This chart is also called as a workplace chart or an operator process chart.

The layout of the workplace is indicated by a grid of 1/4 - inch squares, against which the arrangment of bins, fixtures and parts may be shown. The normal working area is indicated by two semicircles described by the operator's forearms when seated at the workplace. The sketch of the part being handled or processed is shown on the chart in the top right hand corner.

The parts and  positions to the left of the operators are shown with the symbols L1, L2 etc. and to the right are shown by the symbols R1,R2 etc.


2. Mullee, William Robert and David B. Porter, "Process Chart Procedure", Chapter 3 in Industrial Engineering Handbook, Ed. H.B.Maynard, 2nd Edition, McGraw Hill, 


Motion study : a method for increasing the efficiency of the workman (1911)
Author: Gilbreth, Frank Bunker, 1868-1924
Subject: Motion study
Publisher: New York : Van Nostrand
Possible copyright status: NOT_IN_COPYRIGHT
The book gives all examples of Bricklaying
Applied motion study; a collection of papers on the efficient method to industrial preparedness (1917)
Fatigue study; the elimination of humanity's greatest unnecessary waste, a first step in motion study (1919)

Films of Frank Gilbreth

Part 1
Part 2
Therblig Analysis
Research Papers

A 36-Hospital Time and Motion Study: How Do Medical-Surgical Nurses Spend Their Time?http://www.rwjf.org/files/research/060908timeandmotion.pdf


Gait and Posture
Journal of Applied Biomechanics
Journal of human movement studies
Journal of motor behavior
MTM journal of methods-time measurement
Motor control: the international journal for the multidisciplinary study of voluntary movement.
Biomechanics: the journal of lower extremity movement


Originally posted at
http://knol.google.com/k/ motion-study-human-effort-engineering

Knol Number 1140

Ergonomics - Introduction

Ergonomics is the study of the interaction between people and machines and the factors that affect the interaction.

The purpose of ergonomics is to enable a work system to function better by improving the interaction between users and machines.

Ergonomics is the study of the interaction between people and machines and the factors that affect the interaction.

The purpose of ergonomics is to enable a work system to function better by improving the interaction between users and machines.



Evolution of Ergonomics

It owes its development to the same historical processes that gave rise to other disciplines such as industrial engineering and occupational medicine.

Scientific management, developed by F.W.Taylor, and motion study, developed by Gilbreth are precursors of ergonomics. Work study and scientific management were the forerunners of human engineering.

In 1857, Jastrzebowski produced a philosophical treatise on 'An Outline of Ergonomics or the Science of Work' but it seems to have remained unknown outside Poland. The name was re-invented by Murrell in 1949.

An important role for ergonomics generally and for the ergonomist working in a large organization is to act as an interface between developments in basic human and biological sciences and organizational needs. Ergonomics has generated many design guidelines and recommendations, which are made available to engineers and designers.

Some of the guidelines are as following;

12 Principles of Ergonomics

1.Work in neutral postures: Maintain the back with its natural “S-curve” intact during work
2.Reduce excessive force: Use minimum mass; use mechanical assists
3.Keep everything in easy reach: Design workplace according to human body dimensions, avoid over stretching of back and shoulder.
4.Work at proper heights: Elbow height (sitting); waist height (standing); avoid repeated bending of back during work.
5.Reduce excessive motions: Let the tool do the work; design for motion efficiency
6.Minimize fatigue and static load: Workload imposed during work is combination of postural load and metabolic load; Rotate with less demanding tasks, Provide frequent, short rest breaks
7.Minimize pressure points: Avoid concentrated pressure on skin areas; provide padding; provide anti-fatigue mats (half inch thick mat with 3-4 % compressibility)
8.Provide clearance: Design for 95th percentile and provide adjustability
9.Move, exercise, and stretch: Take “Energy Breaks”; allow for alternate postures; alternate between sitting and standing; change chair positioning; periodical monitoring of fitness. Introduce stretching exercises before shift
10.Maintain a comfortable environment: Provide appropriate lighting, task lighting, avoid temperature extremes, isolate vibration, reduce sources of noise.
11.Make displays and controls understandable: Design for expectations.
12.Improve work organization: Design task – Plan, Be involved, Communicate, Enlarge jobs, Be part of the team, Be considerate. Be a good manager.

Visit for more details


Rules of Ergonomics

1.Belly button rule: Loads that are held, lifted and carried should be kept closer to the belly button to avoid extended arm posture
2.Straight wrist rule: Avoid bending of the wrist, in jobs requiring frequent pushing or pulling, use thumbs instead of other fingers
3.Eye rule: Displays within visual field, avoid excessive neck tilt
4.Skin rule: Work area free from obstruction; avoid concentrated pressure on small skin areas
5.Straight back rule: Avoid bending of the body, keep your back straight, bend your legs, not your back.

Workers or operators should sit when:

1. They must work at the same task for an extended time period (30 min or more).

2. Task demands steadiness for the operator as well as the devices being used.

3. They need to be restrained to prevent their displacement by dynamic environmental forces.

Operators should not have to sit or stand for long periods with their head, torso, or limb positions skewed; they should be able to keep their heads, necks, torsos, and limbs in a symmetrical relationship as much as possible.

Operators should not be forced to work frequently or for long periods with their hands and arms above normal elbow level.

Avoid positioning operators in supine or prone positions.

Repetitive arm and leg motions should be in the direction that limbs articulate normally about typical shoulder, elbow, wrist, hip, knee, or ankle pivot points.

When both hands or both feet are involved simultaneously, create a configuration in which the motions are opposite rather than in the same direction; i.e., the right hand should rotate in the opposite direction to the left, and the right foot should push forward while the left relaxes in the aft direction.

Provide backrests for seated operators.

Provide arm rests.

Provide hand rests, when operators are using a continuously operated controller, such as desk-mounted joy stick or roller-ball control.

For computer data entry, the center of the key board should be at about elbow level. The associated visual display should positioned so that the operator’s line of sight is perpendicular to the face of the CRT.

Computer work station design guidelines are given in the “American National Standard for Human Factors Engineering of Visual Display Terminal Work Stations,” ANSI/HFS 100-1988, February 1988.

When the package (e.g., a suitcase) has smooth sides, it can be carried against the person’s hip or leg without too much stress. The weight should not exceed more than about 20 kg for males and 14 to 18 kg for females. For backpacks also similar weights are recommended.

For further reference on design guidelines

Human Factors Design Handbook, Second Edition, McGraw Hill, 1992.

Originally posted at
http://knol.google.com/k/ ergonomics-introduction
Knol Number 5

Work Measurement

Efficient methods are selected with the help of work measurement techniques when time is the most important parameter for deciding the efficiency of a method. Even if cost is the decision variable, we have to know the manpower time and machine times to calculate the cost of a method.

F.W. Taylor came out with stop watch time technique that measured time taken for each element of an operation and systematized the work measurement procedures. Based on these time studies standard times of various work pieces were determined and fair job for the day of the worker was established using these standard times. Incentive systems were put in place to provide scope and income opportunity for production above the standard rate and also to provide motivation to reach the standard and exceed the standard.









Predetermined Motion Time Systems (PMTS)

Predetermined Motion Time System (PMTS) - Introduction

A predetermined motion time system (PMTS) consists of a set of time data for basic human motions and a systematic procedure which analyses and subdivides any manual operation of human task into motions, body movements, or other elements of human performance, and assigns to each the appropriate time value.

Each system of time data was originally developed from extensive studies of all aspects of human performance through measurement, evaluation, and validation procedures.

PMTS in Use

Barnes listed 9 perdetermined motion time systems in his 1980 Edition.

They are:
1. Motion-Time Analysis (MTA) - 1924
2. Body Member Movements - 1938
3. Motion Time Data for Assembly Work - 1938
4. The Work-Factor System 1938
5. Elemental Time Standard for Basic Manual Work 1942
6. Methods-Time Measurement (MTM) 1948
7. Basic Motion Timestudy (BMT) 1950
8. Dimensional Motion Times (DMT) 1952
9. Predetermined HumanWork Times 1952

Source: Barnes, Ralph M., Motion and Time Study: Design and Measurement of Work, Seventh Edition, 1980, Chapter 27.

PMTS - Differences

Predetermined motion time systems can be categorized as motion based, action based and activity based systems.

Motion based systems


Action based systems


Activity based systems


"MTM" stands for Methods-Time Measurement. It is a procedure for improving methods and establishing time standards by recognizing, classifying, and describing the motions used or required to perform a given operation and assigning pre-determined time standards to these motions.

MTM evolved into a dynamic family of systems. It is continuing to grow and meet more needs of its practitioners and users. It has developed from a single system of work measurement and analysis to a family of systems that meets the varied demands of different users.

The basic MTM data was developed by H B Maynard, J L Schwab and G J Stegemerten of the Methods Engineering Council during a consultancy assignment at the Westinghouse Brake and Signal Corporation, USA in the 1940's. This data and the application rules for the MTM system were refined, extended, defined, industrially tested and documented as a result of further work in later years.

In 1948 Maynard, Stegemerten and Schwab published the book "Methods ­Time Measurement" giving full details of the development of the MTM system and its application rules. The use of MTM spread, firstly in the USA, and then to other industrialised countries. In 1951 the US/Canada MTM Association for Standards and Research was formed by MTM users. The system originators then assigned the MTM copyrights to the MTM Association. (http://www.ukmtm.co.uk/systems/mtm-1.asp )

In 1963, a new member of MTM family with the name MTM-GPD (General Purpose Data) was introduced. The original MTM of 1948 was termed as MTM-1.


The unit of time used in MTM tables is one hundred-thouandath of an hour (0.00001 hour). The time units of MTM aer referred to as Time Measurement Unit (TMU). One TMU is equal to 0.0006 minute.

The basic motions used in MTM-1 are:

Reach - R
Move - M
Turn - T
Apply Pressure - AP
Grasp - G
Position - P
Release - RL
Disengage - D
Eye Travel - ET and Eye Focus - EF
Leg Foot Motions: FM, FMP, LM_,
Horizontal Motions - Side Step - SS_C1, SS_C2, Turn Body TBC1, TBC2,
Walk: W_FT, W_P, W_PO
Vertical Motion SIT, STD, [B,S,KOK], [AB,AS,AKOK], KBK, AKBK

Source: Barnes, Ralph M., Motion and Time Study: Design and Measurement of Work, Seventh Edition, 1980, Chapter 28.

Generic Systems of MTM

MTM Systems designed to do work measurement in multiple environments.


MTM-1 is the basic system form which all other MTM systems have been developed. This system is used worldwide. It determines the time necessary for performing a given operation by analyzing the manual motions required and assigning a time value to each. MTM-1 is ideally suited to use in high volume production environments.


MTM-UAS represents a second generation of synthesized data, based on the MTM-1 system. It was constructed through use of statistical analysis of basic MTM-1 motion patterns. This system is best-suited for use in environments which exhibit the characteristics of batch production.


MTM-MEK, a third generation system based on statistical analysis of MTM-1 data, is designed for economical measurement of small lot or one-of-a-kind production, with long-cycle times, as well as other infrequently performed tasks previously considered too costly or difficult to measure.


4M is a second level system used to convey MTM-1 level information to the MTM-LINK software for use in methods analysis and standards development. It is suited to long run production.


MTM-B represents a third generation of synthesized data, based on the MTM-UAS system. It was constructed through use of statistical analysis of basic MTM-UAS motion patterns. This system is best-suited for use as an estimating tool where the primary focus is speed of application. MTM-B is offered as a data module of the MTM-LINK Software System. Manual application is not supported.

Functional MTM Systems

MTM Systems applicable to specific work measurement environments.

MTM-HC® (Healthcare)

MTM-HC is a standard database devoted specifically to healthcare activities.

MTM-C® (Clerical Activity)

MTM-C is designed specifically for measuring clerical activity.

MTM-V® (Machine Shop)

MTM-V is a standard data system for measuring difficult-to-time long cycle manual machine shop tasks.

MTM-TE® (Electronic Test)

MTM-TE is a standard data system for measuring mental and manual activity in the electronic test environment.

MTM-M® (Work Under Microscopes)

MTM-M is the only system available which is capable of accurately measuring assembly, wiring, soldering and other work performed under microscopes.

(Source: http://www.mtm.org/systems.htm )

MTM software

The MTM software family of help to industrial engineers consists of:

* TiCon®
* Time Ladders
* PC Graphics®

MTM Association Publications - Books
( http://www.mtm.org/pubs.htm )

Books can be ordered through the MTM Association.

MTM - FIRST TIME RIGHT ... A fascinating journey through MTM history, research, and application. By the International MTM Directorate

Basic Motions of MTM ... A clear presentation of MTM-1 motions, their coding, application rules, and TMU values. By William Antis, John Honeycutt and Edward Koch

Standard Data Systems and Their Construction ... The development, verification, maintenance and use of standard data from planning through production. By V. Aulanko, j. Hotanen and A. Salonen


MTM Research reports can be ordered through the MTM Association.

The Research Reports are:

R.R. 101 DISENGAGE ... Preliminary study and theory of disengage.
R.R. 102 READING OPERATIONS ...Synopsis of work done by eleven leading authorities.
R.R.104 MTM ANALYSIS OF PERFORMANCE RATING SYSTEMS ...An analysis of performance rating systems and various rating films from an MTM standpoint.
R.R. 105 A STUDY OF SIMULTANEOUS MOTIONS ... Final report of the Simultaneous Motions project undertaken by the MTM Association. Presents a great deal of new and valuable information which should be of interest to every MTM practitioner.
R.R. 106 SHORT REACHES AND MOVES ... An analysis of the characteristics of Reaches and Moves at very short distances. It develops important conclusions concerning the application of MTM to operations involving short distance elements.
R.R. 107 A RESEARCH METHODS MANUAL ...An effective and comprehensive set of methods for carrying on research in human motions. Major techniques, adequate sources of motion data, film analysis, data recording, and statistical methods of analysis are among the topics discussed.
R.R. 108 A STUDY OF ARM MOVEMENTS INVOLVING WEIGHT ...The effect of weight on the performance times of arm movements is presented, along with a comprehensive discussion of the whole area of weight phenomena.
R.R. 109 A STUDY OF POSITIONING MOVEMENTS ...I. The General Characteristics. II. Appendix - Defines "positioning movements and the inter-relation of component movements". The study is limited to the laboratory analysis.
R.R. 110 A STUDY OF POSITIONING MOVEMENTS III ... Application to Industrial Work Measurement. This report, the second on position, relates the results of the position research to the field of application. This study deals with actual industrial operators, work measurement tools and improving manual activity through better understanding of positioning movements.
R.R. 111 INDUSTRIAL RESEARCH ON THE ELEMENT APPLY PRESSURE ...Examines the element "Apply Pressure" under factory conditions. The report contains a descriptive analysis of the fundamental structure of the element Apply Pressure along with numerical data gathered in the research.
R.R. 112 LEARNING CURVE RESEARCH ON SHORT-CYCLE OPERATION ...A report of the first of a series of experiments which have been performed to determine how people learn the most common MTM motions. This is the preliminary or "laboratory" phase of the project Learning. This phase of the Learning project provided a series of prediction equations for the most frequently used elements.
R.R. 113A LEARNING CURVE RESEARCH ON MANUAL OPERATIONS ...Presents the results of Learning. The report details a method of combining the Learning Curves of R.R. 112 to develop a prediction equation covering an overall learning Curve for a manual operation.
R.R. 114 FACTORS IN MANUAL SKILL TRAINING ...Results of four years' study at the University of Michigan on the various factors involved in the learning process required to attain a manual skill especially the learning that occurs after the person barely knows how to do the operation.
R.R. 115 PREDICTION OF ELEMENTAL MOTION PERFORMANCE USING PERSONNEL SELECTION TESTS ... A general methodology for predicting the level of performance an individual should be able to attain when working on a manual task where a pre-determined time standard is a measure of his performance. The Methods-Time Measurement system is the system used.

Originally posted in

Methods Efficiency Engineering

In industrial engineering, there is a branch popularized as methods engineering, method study or work study. The right term for this subject should be "Methods Efficiency Engineering". Methods Engineering is the process of coming out with methods to manufacture a component, a product or to perform a service. Methods engineering is expected to come out with effective and efficient method. Industrial engineering participates in the methods engineering activity to provide efficiency related services.

Industrial engineers use analysis to find inefficiencies in proposed methods or existing ways of work and then synthesize the new method having the most efficient components and then standardize the method. It includes training workmen also. Then they develop standard times for the installed standard times.

For improving methods efficiency, industrial engineers use process efficiency analysis techniques, operation efficiency analysis techniques and motion efficiency analysis techniques.

Casetudy: http://www.globalresearch.com.my/main/papers/icber/PAPER_107_ImpactTime.pdf

Time and Motion Studies in Libraries http://www.ideals.illinois.edu/bitstream/handle/2142/5533/librarytrendsv2i3F_opt.pdf

Originally posted in

Product Design Efficiency Engineering

Industrial engineers are system efficiency designers. They evaluate the efficiency of various functional system designs proposed by functional designers and managers and wherever inefficiencies are found, will facilitate removal of them.
Product design efficiency engineering is an activity of industrial engineers.

Industrial engineers are system efficiency designers. They evaluate the efficiency of various functional system designs proposed by functional designers and managers and wherever inefficiencies are found, will facilitate removal of them.

Product design efficiency engineering is an activity of industrial engineers. As a part of the method study, the techniques of methods efficiency engineering, industrial engineers examined the efficiency of design. The development of value engineering systematized the product design efficiency engineering process. L.D. Miles started the value engineering process and did an immense service to the society.

Efficiency of the designs is analyzed with respect to its functions, its features, subassembly design, component specifications including tolerances and fits, material specifications, use of standard boughtout parts, and manufacturing processes employed in value engineering. Value engineering practice has given immense savings in the product costs in various industrial sectors.

Knol: Part of Industrial Engineering Course Page -

Introduction to Industrial Engineering - Course at NITIE
Web Page Related to Design Efficiency

Design Efficiency Will Keep Your Product From BOMing Out

Fitting Product Design to Production Efficiency

Shaping Efficiency Using CHiL Semiconductor Digital Algorithms

Palletisation efficiency as a criterion for product design
By Eberhard E. Bischoff
Journal: OR Spectrum, Issue Volume 19, Number 2 / April, 1997, Pages:139-145

Design Efficiency of Market Seeker Strategy and Marker Leader Strategy

Bob Jensen, Technical Support Team Engineer, Sauer-Danfoss
December 14, 2009

Article originally posted in

Value Engineering - Introduction

Value Analysis and Value Engineering - Miles Way (L.D. Miles)

Value engineering has for its purpose the efficient identification and elimination of unnecessary cost. First article on the topic was written by L.D. Miles in 1949. Link available in this article.

What is Value Engineering?

Value engineering has for its purpose the efficient identification of unnecessary cost, i.e., cost which provides neither quality nor use nor life nor appearance nor customer features. It focuses the attention of engineering, manufacturing, and purchasing on one objective – equivalent performance for lower cost. It results in the orderly utilization of low cost alternative materials, low cost alternative processes including new processes, and abilities of specialized suppliers to procure items at lower costs.
Lawrence D. Miles is the pioneer of this technique. He wrote the book - Techniques of Value Analysis and Engineering - in 1961. His designation at that time was Manager, Value Service, General Electric Company. He published the first article on value analysis in 1949 in American Machinist.

Functional design is not tampered:
Inherent in the philosophy of value engineering is the full retention for the customer of the usefulness and esteem features of the product. Miles argued emphatically right at the beginning of his book, “Techniques of Value Analysis and Engineering” that identifying and removing unnecessary cost, and thus improving the value, must be done without reducing in the slightest degree quality, safety, life, reliability, dependability, and the features and attractiveness that the customer wants.

What is Value?

Miles described  four types of value.

1. Use value: The properties and qualities which accomplish a use, work, or service.
2. Esteem value: The properties, features, or attractiveness which cause us to want to own it.
3. Cost value: The sum of labor, material, and various other costs required to produce it.
4. Exchange value: Its properties or qualities which enable us to exchange it for something else we want.

Even though Miles did not describe it that way, I feel value analysis or engineering is concerned with cost value without in anyway decreasing the use value, esteem value and exchange value

Value Analysis Techniques

Miles provided 13 ideas as value analysis techniques.
  1. Avoid generalities
  2. Get all available costs
  3. Use information from the best source
  4. Blast create and refine
  5. Use real creativity
  6. Identify and overcome roadblocks
  7. Use industry experts to extend specialized knowledge
  8. Get a dollar sign on key tolerances
  9. Utilize vendors’ available functional products
  10. Utilize and pay for vendors’ skills and knowledge
  11. Utilize specialty processes
  12. Utilize applicable standards
  13. Use the criterion, “would I spend my money this way?”
The Right Way to use the Techniques
Choose appropriate techniques to value engineer the specific product.
Arrange the techniques in best order for the particular job.
Use each technique imaginatively and effectively.
Use the techniques iteratively until useful information is developed to the extent that direction for decision and action is available.
To use the techniques an analyst requires special knowledge.
Value engineer is not a functional designer. He will have access to functional designers as needed in his value work. Hence his knowledge is not specialized to particular areas like mechanical engineering, electrical engineering, automobile engineering, or aerospace engineering. Knowledge required for high-grade value work is extremely broad.
The specialized knowledge required in value improvement work consists of information on materials, processes, functional products, sources of functional knowledge, approaches to function performance, and practical ideas for economical function performance.
It is important that the value engineer’s library of special knowledge contains a comprehensive volume of trade knowledge backed by efficient means for a quick recall of needed information. Value engineer also needs well-organized references to a maximum number of persons of special skills that may be consulted in connection with each problem.
Value engineers need develop a database having the association between properties of materials and costs apart from material and its cost. Similarly a database that shows the relationship between the properties of products produced by various processes and the cost of each process, including the material used is also valuable.

This topic will be discussed in more detail in a separate article 'Knowledge Required for Value Engineering'.
Job Plan for Value Engineering
Phase 1. Orientation: Understand the customers’ needs and wants. Understand the functions performed by the product and the contribution of each part and each feature of the part and the complete product to the functions to be performed by the product.
Value engineer has to make sure that he does not diminish the contribution of the product to the customers' needs and wants.
Phase 2. Information: Collection of information on quantities, vendors, drawings, materials, manufacturing methods, and costs.
Techniques to be used:

Get all available costs
Get a dollar sign on key tolerances

Phase 3. Speculation: Using all the techniques of value analysis to come out with alternative low cost materials and methods to produce components and the product. Creativity is to be employed here. Value engineer has to involve experts from various disciplines to help with ideas.
Techniques to be used:

Blast, create and refine

For each function to be performed by a product or a component, find alternative products, materials or processes that serve the function to a great extent but at a less cost. These alternative ideas do not satisfy the specified or required function completely but they do to a significant extent. Identify they function they perform and the cost involved,

During the blast activity use these techniques.
Utilize vendors’ available functional products

  • Utilize and pay for vendors’ skills and knowledge
  • Utilize specialty processes
  • Utilize applicable standards
  • Use the criterion, “would I spend my money this way?”

  • All the five techniques have the potential to suggest lower cost alternatives


    In create phase, the technique of "Use real creativity" needs to be employed to come out with ways by which the low cost alternatives identified during the blast stage can be modified to accomplish the specified function to a much greater extent with pertinent increase in cost. During this stage also the improvement in function and the increase in cost are to be clearly identified.


    In this step, much more creativity is used and also the techniques "Use industry experts to extend specialized knowledge" and  "Utilize and pay for vendors’ skills and knowledge" are used to refine the ideas developed during the create step to come out with a refined alternative that fully accomplishes the specified function at a lower cost. During refine step, some more functionality is added as well as some additional cost.

    Phase 4. Analysis:  Technical and cost analysis of the alternative proposed.

    The techniques to keep in mind and use during this stage are:
    Avoid generalities
    Use information from the best source
    Identify and overcome roadblocks

    Phase 5. Program planning: Approach the specialists to further refine the selected alternatives. Inform the specialists the accepted suggestions and give mandate to them to take steps to implement the suggestions.
    Phase 6. Program execution: Pursue regularly the specialists and vendors to get their inputs on various tasks assigned to them. The output of this phase is a detailed design, successful trail  pilot  run of a manufacturing process or  a confirmed estimate from a vendor for supplying a component, material or sub assembly.
    Phase 7. Status summary and conclusion. The results of the value engineering study are to be presented to decision makers. The reports needs to have a summary sheet as well as the full supporting documentation.  The value engineering project is concluded when the product is manufactured and distributed at the lowered cost as per the value engineering study.

    Special Knowledge Required

    In practically all fields, the operator used special tools and special or field specific knowledge. Value analysis and engineering is no exception.

    Reach of knowlege: For value analysis, the knowledge required is extremely broad.
    Nature of knowledge: Information on materials, processes,  and functional products.
    Form and Constitution of Knowledge Fund: Handbooks, catalogues, charts, price lists, product and process descriptions, tables etc.
    Listing of specialized Competence: Value analysis requires consulting specialists and specialized sources. So a list of consultants as well as special publication is required for various materials, processes and components.

    Qualifications and Training for Value Analysts and Engineers

    Qualifications: Logic, creativity, ability to make rapid searches, recall, ability to quickly sort out useful information,  synthesis of solutions, selection of promising alternatives.

    Knowledge: Understanding of the properties of materials, and of manufacturing processes, their potentialities, and their limitations.

    Traits required: Imagination, initiative, self-organization, cooperative attitude,
    Attitude: belief in the importance of value

    Training: Three weeks class room followed by six months of practical work.
    Another round of three weeks class room followed six months of practical work
    Another round of three weeks.

    For further study:

    First article by L.D. Miles in 1949  http://minds.wisconsin.edu/handle/1793/3948 download the file 35.5 pdf from this page.

    Lawrence D. Miles, Techniques of Value Analysis and Engineering, McGraw-Hill Book Company, New York 1961.

    Note on Value Engineering
    Especially gives Juran's and Clawson's comments on value engineering

    Value Engineering - NPC, Chennai (77 page Document. Available online)
    History of Value Engineering

    1.17 minutes


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    Originally posted at
    http://knol.google.com/k/value-engineering-introduction# - Knol Number 4
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