# Learning Curve

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LEARNING CURVE CONCEPT AND ITS USEFULNESS IN MANAGEMENT DECISIONS
Presented ByKriti Agarwal (A002) Aniket Rane(A046) Nitin Gupta(A024) Eshan Singh(A057) Mayank Bhatia(A013)

HISTORY
Introduced to the aircraft industry in 1936 by T. P. Wright in his article Journal of the Aeronautical Science He found that per unit production time reduced at an unvarying rate Since then, learning curves (also known as progress functions) have been applied to all types of work

INTRODUCTION
A graphical representation of the changing rate of learning (in the average person) for a given activity or tool The underlying hypothesis is that the direct labor man-hours necessary to complete a unit of production will decrease by a constant percentage each
In this case, the learning curve is a horizontal line and there is no learning.

DIFFERENCE BETWEEN TWO MODELS
Over the first few units, an operation following the cumulative average curve will experience a much greater reduction in cost (hours or dollars) than an operation following a unit curve with the same slope. The unit curve should be used in situations where the firm is fully prepared for production; and the cumulative average curve should be used in situations where the firm is not completely ready for production. Most firms in the airframe industry use the cumulative average curve. Most firms in other industries use the unit curve.

EXAMPLE to Understand Formula y = axb b = log (Learning Rate) / log 2 For 80% LC, (Learning Rate) = .80 b = log .80 / log 2 = -.3219 Assume k = 1000 y1 = 1000 (1)-.3219 = 1000 (1) = 1000 y2 = 1000 (2)-.3219 = 1000 (.80) = 800 y3 = 1000 (3)-.3219 = 1000 (.7021) = 702 y4 = 1000 (4)-.3219 = 1000 (.6400) = 640 y100 = 1000 (100)-.3219 = 1000 (.2270) = 227

LEARNING CURVE Coefficients
70% Unit Number (N) 1 2 3 4 5 10 15 20 85%

Unit Time(C) 1.000 .700 .568 .490 .437 .306 .248 .214

Total Time 1.000 1.700 2.268 2.758 3.195 4.932 6.274 7.407

Unit Time(C) 1.000 .850 .773 .723 .686 .583 .530 .495