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With GSD huge benefits and improvement in productivity can be achieved by using some simple numbers.
Example:
A factory produces a range of products with a factory capacity is 100,000 pieces/month and on average, it sells its products at $10 per piece.
The $10 is made up of material costs, labour costs, overheads and profit. The material costs of the product is $5.00, the Labour cost $2.00 and the company overheads are $2.00 giving a profit of $1.00 (10%), which gives a profit for the company of US$ 100,000 per month.
On the basis of GSD and increase productivity by 10%, the company can create an additional 10,000 pieces per month. Since these pieces have been manufactured as a direct result of an increase in productivity they attract no labour cost and are made in “zero time”. So in effect they have been created with no labour cost and no overhead, therefore the value of these additional garments is equal to the selling price minus the material costs which in this case is $5.
The value (or profit) of the additional garments then is 10,000 (additional pieces) x $5 = $50,000 per month. The profit has been increased by 50% from a productivity improvement of 10% - with 10% perhaps being a little cautious. Applying the same logic to higher productivity gains the following scenarios can be achieved
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ProductivityIncrease
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Additional Garments/Month
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Additional Monthly Profitt
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15%
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15,000
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$ 75,000
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20%
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20,000
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$ 100,000
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The above figures clearly state the effects on productivity resulting from Methods Improvement.
GSD creates a benchmark for efficiency and performance. Factories can set targets against this international standard, then evaluate their competitiveness and manage their business more effectively. It can do product costing quickly and effieciently for new styles. GSD helps to reduce cost and improve productivity. GSD facilitates the ethical application work measurement and in so doing assist with the goal of achieving acceptable levels of Social Compliance. GSD is a scientific manufacturing methods analysis process which, through the application of codes with Predetermined Times Standards (PTS), accurately & consistently establishes “Standard Time” for the apparel and sewn products industries.
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Participants