Productivity / purpose of improving productivity /Factor affecting productivity

This article contains productivity definition, the purpose of improving productivity, and factors affecting productivity.


        productivity of a production system is similar to the efficiency of the production system. Productivity may be defined as the ratio of the output of the system to its input. Output means the number of finished products or services, and inputs are land, building, equipment, material, machinery, labor, etc.
All the organization or production systems aimed to raise productivity within the available resources.

Purpose of improving productivity:

1. For Management:

      Improvement of productivity means produces more goods from a comparatively lesser amount of resources. That means selling more and produce a good profit. Increases in productivity allow management to sell products at a lower price than the competition and stand better in the market.

2. For workers:

       Higher productivity implies more profit of the organization and that helps the worker to get more wages, better working conditions, and the standard of living will be higher. Workers are able to increase productivity that reflects their skillfulness, so job security and job satisfaction will be there.

3. For customers:

        The increase in productivity means the consumer will able to buy more amounts of goods at a lower price. it will improve their living standard. Products can be distributed to more areas so that more people can access the products.

Factor Affecting productivity:

1.Human Resources:

         General level of education is important for workers. To operate a computer and other electronic equipment educated employees are needed. Employees need to be motivated to be productive. They need to have good, safe working condition to perform better, only pay is not enough. The government can help by sponsoring more education, skill training, etc.

2. Product Design:

           Through better product design, the unnecessary parts can be eliminated, by this way uses of material can be reduced. This will allow companies to reduce the market price of the products and make affordable for consumers. Value analysis can be brought out many product design changes that improve productivity.
Standardization of product and the uses of group technology and other design factors that make it possible to improve productivity.

3. Technology and Capital Investment:

           The major factor in continuing productivity improvement is the technology and new technology depends on Research and development. To put new technology organizations must invest in new machinery and equipment.
The government should promote Research and Development Industries, encourage personal savings, and reduce taxes on profits so people can invest in facilities. Directly encourage new investment through increase investment tax credits.

4. Machinery and Equipment:

           Proper layout of the plant and machinery is very important to increase productivity, it reduces the material handling cost, reduce the rest time thus improve productivity. The equipment used-machines, conveyors, robots, all are an important factor in productivity.
Computer-aided design(CAD) and CNC machines are becoming an essential ingredient in product improvement.

5. Skill and Effectiveness of the Worker:

           A trained worker can do the same job in a much shorter time. However, even well-trained employees must be motivated to be productive. 

6. Production Volume:

           If the volume of output to be increased, the number of direct worker and few indirect workers need to be increased. But there would probably not be needed for more number of engineers, research scientists, headquarters staff people. So the increase in production volume increases productivity.

7. Government Regulation:

        The government can eliminate unneeded regulations and to make cost-benefit analysis ti determine necessary regulation such as those on health and safety.


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