Experience Curve

1. Managing Learning Curves in
Factories by Creating and
Transferring Knowledge -
Michael A. Lapré &Luk N. Van Wassenhove

2. Learning Curve (Abstract)
• As factories gain production experience, productivity and quality improve
at a decreasing rate. Yet, factories show considerable variation in learning
rates.
Two dimensions of learning processes :
1. conceptual learning which yields know-why
2. operational learning which yields know-how
Result of Research : Only 25% of the projects which acquired both know-
why and know-how accelerated the learning rate.

3. Learning Curve ( General Concepts)
Learning curve literature : the only way to speed up cost improvement is to
speed up cumulative volume, which may not always be desirable nor feasible.
Experts say : the rate at which individuals and organizations learn may become
the only sustainable competitive advantage.
Barriers to learning in factories :
• Separation of cause-and-effect in time and space (dynamic complexity).
• Presence of too many variables, which makes it difficult to comprehend a
system in its entirety (detail complexity).
• Simultaneous existence of equally plausible but mutually contradicting
explanations of a situation (ambiguity).
• Lack of a full understanding of the effects of input variables of a process on
the output (incomplete technological knowledge).

4. Bekaert’s process flow

5. Barriers to learning about its
production process at Bekaert :
• Detail complexity : need to coordinate hundreds of machines, hundreds of
process variables to control, different customer specifications for wires and
the different technical skills required at the different stages.
• Dynamic complexity : the ease with which effects of problems experienced
at any machine or production stage could be transmitted to other
machines and stages.
• Ambiguity : production personnel often disagreed on causes for a
particular production problem such as fractures.
• Incomplete technological knowledge : nobody could specify the
combination of the hundreds of process settings that would prevent the
occurrence of defects.

6. Total Quality Management program at
Bekaert’s flagship Aalter plant
Scope of study :
62 quality improvement projects undertaken between 1982 and 1991.
Classification of projects :
• Firefighting.
• Artisan skills.
• Non-validated theories.
• Operationally validated theories.

7. • In 1988 : Established Model Line Altar(MLA) for an important
representative product and gave a senior R&D manager the
responsibility to create fundamental process control knowledge
without sacrificing the production of saleable wire.
This production line cutting across departments, ran as a learning
laboratory produced both conceptual and operational learning.

8. Performance comparison of Different
model lines

9. Conclusions
• Replicating the model line concept is not so easy. In addition to the
model line structure, both organizational factors, such as
management buy-in and knowledge diversity to engage in
interdepartmental problem solving, as well as a stable environment
with continuity in resources, such as raw material suppliers, are
required.