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Although Total Factor Productivity (TFP)measures Are Comprehensive, Operations Personnel Find

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Although total factor productivity (TFP)measures are comprehensive, operations personnel find financial TFP measures more difficult to understand and less useful than physical partial productivity measures in performing their tasks.


Definitions:

Design Engineering

The branch of engineering focused on the design, development, and testing of products, systems, or structures, ensuring they meet specified requirements.

External Failure Cost

Costs incurred when a product or service fails to meet quality standards after it is delivered to the customer, including returns, repairs, and warranty claims.

Non-Value-Added

Activities or processes that do not add any significant value to the final product or service from the customer's perspective.

Value-Added Ratio

The ratio of the value-added lead time to the total lead time.

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