A review of literature on manufacturing systems productivity measurement and improvement

Globalisation is posing several challenges to the manufacturing sector. Design and operation of manufacturing systems are of great economic importance. Factory performance remains unpredictable, in spite of the considerable literature on manufacturing productivity improvement and the long history of manufacturing, as there is no widespread agreement on how it can best be performed (Gershwin, 2000). Productivity measurement and improvement goes hand in hand, because one cannot improve what one cannot measure. The review of literature on manufacturing systems productivity measurement and improvement has been summarised under four categories; they are Operations Research- (OR-) based methods, system analysis-based methods, continuous improvement methods and performance metrics-based methods. A survey of commercial tools available to measure manufacturing system performance is also performed. The review indicates that quantitative metrics for measuring factory level productivity and for performing factory level diagnostics (bottleneck detection, hidden capacity identification) are lacking. To address this gap, a factory level effectiveness metrics-based productivity measurement and diagnostic methodology is proposed.