External Factors - Factors Affecting Productivity Improvement

As was previously stated, the organisation has no direct control over external factors, be they government policy, climate or social trends.

Since they do, however, have an impact upon the way in which the company operates, it is essential that management can appreciate their possible impact upon the firm. As in the previous discussion on internal factors, external factors may also be sub categorised, in this case into three categories: 

• Structural adjustments
• Natural resources
• Government and infrastructure.

Since government is the de facto leader in industrial improvement and due to the impact that productivity may have at a national level, it is in the interest of all governments to find ways in which they can ease the path of companies towards the goal of higher productivity.