W11_Austin_Learning Curve for AACE N413 Weekly Blog Posting

1.  Problem recognition, definition and evaluation

The underlying principle of learning curve is that the more often we repeat a given task, the more efficient we become. Hence, the purpose of this week evaluation is to apply learning curve to our AACE N413 certification Blog posting and determine how long it will take us to post the week 24^th Blog.

2.  Development of the feasible alternatives

Two types of learning curves are typically applicable in evaluating progress with repetitive activities:

1.   Weekly Learning Curve

2.   Cumulative Average Learning Curve

Weekly Learning Curve: The value of each week follows the constant rate rule. Thus, if week 10 is expected to take 20 hours to complete (@ 2 hours per week), then week 20 is estimated to take 18 hours, assuming an 80% learning curve slope.

Cumulative Average Learning Curve: The cumulative average value through the weeks follow the constant rate rule. The average rate of weekly hours decreases as the number of weeks involved increases:

3.  Development of the outcomes and cash flows for each Alternative

It was observed that as the number of weeks doubled, the weekly value or cumulative average value tended to be a constant percent of the value of the weekly number that was doubled. The constant percent reduction is called the slope. This relationship is represented by the following equation:

Y_x = T₁ x (X)^b ;

Where T1 = theoretical or estimated value of first week

        X = the week being calculated

         b = the exponential value associated with the slope

When the estimated improvement rate for completing a weekly post is plotted versus the number of weeks produced, the display is a curve which decreases to the right as the number of weeks increase:

Above curve shows an 80% weekly learning curve plotted in normal coordinates.

4.  Selection of the acceptable criteria

Factors that must remain constant for learning curves to be meaningfully applied include;

a.   The steps are similar and repetitive.

b.   The same people with same objective and supervision are involved in the process.

c.   There are no significant delays between repetitive weekly postings.

d.   Avoid frequent starts and stops, with lag time in the middle that could cause loss of proficiency.

5.  Analysis and Comparison of the alternatives

Calculation results for both methods:

6.  Selection of the preferred alternative

The principle of the cumulative average learning curve is that when a process or operation is done repetitively, those performing the operation will become more proficient over time and so number of hours per week will decrease, as shown in table above.

7.  Performance Monitoring and Post Evaluation of Results

Based on the tabular evaluation, for the cumulative average learning curve to be meaningful, there should be a continuity of the production cycle. If there is a break in continuity, there would be some loss of learning improvement, which could result in significant cost overrun and loss of credibility.

8.   References/Bibliography

1  1. Hartley, H.K. (1965), The Journal of Industrial Economics,

     The theory of learning as used in the Aircraft Industry states that direct labor

    learns as it works-the more often a worker repeats a given task, the more efficient
    he will become. Retrieved from: http://www.jstor.org/discover/10.2307
    /2097667?uid=17372520&uid=3738032&uid=16739312&uid=2&uid=3&uid=67&
    uid=62&sid=21101492738607

1  2. Humphreys, K.K. (1991), Cost and Optimization Engineering, 3rd ed., the

       accountant' s application of depreciation for each year is called a Learning

       curve as a function of the gain for double the production. Retrieved from:

       http://www.crcnetbase.com/doi/abs/10.1201/9780849390388.ch1

1    3. Humphreys, G.C. (2012), The Humphreys & Associates team field of

         earned value project management consulting and training. U heeft dit openbaar een +1 gegeven. Retrieved from:Ongedaan maken

     http://cad.digitalmedianet.com/articles/viewarticle.jsp?id=225841

4. Giammalvo, P.D (2012, October 22). Integrated portfolio (asset), program (operations) and project management methodology course (Power Point slides) (An AACE methodology course).  Lagos.  Nigeria.

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