What Is The Learning Curve Theory?

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A worker is likely to gain experience, become more efficient and faster as they carry out a repeated performance of a job task. Human beings improve skills, gain experience, exposure and specialize as they repeat the performance of a particular task. This is known as the learning curve effect.


A worker with the no previous experience and knowledge is untried the first time they perform a new operation. As the worker repeats the operation and becomes more familiar with it, their labor efficiency increases and their labor cost per unit decreases. After the passage of time, the regular rate of decline in cost per unit is established and used as a basis to predict future labor cost..


The learning process begins at the point the first unit comes off from the production line. And each time cumulative production is doubled, the average taken to produce a unit of cumulative production is a percentage of the average time of the previous cumulative production.


What is the learning curve theory?


The learning curve theory says that whenever a repetitive task is performed, the average time spent to produce a unit falls by a specific percentage as the activity level is doubled. For example, there is a learning phenomenal of 80% for a 20% decline in average time and a 75% learning phenomenal for a 25% decline in average time.


The learning curve is the mathematical expression of the phenomenon that when a complex and labor intensive procedures are repeated, unit labor times tend to decrease at a constant rate.


An Example:


For company ABC, the first units of output require 800 hours and 80% learning curve is applied.

A. Units ProducedB. Cummulative UnitsC. Cummulative Average Time/HourD. Total Hours (BxC)E. Time Per BatchF. Incremental Time Per Unit (E/A)
11800800
126401280480480
245122048768384
4841032801232308
81632852481968246

Note the following:

  1. Output is doubled each time.

2. The incremental time per unit reduces at a faster rate than the average time per unit.

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