Transforming inputs into outputs - productivity measures, Operation Management

Assignment Help:

Transforming Inputs into Outputs - Productivity Measures

As will become clearer during the course of this chapter, a more quantitative definition of productivity cannot easily be given, since both the measures of achievement and the objectives of the organisation will have a major impact on the way and means by which productivity is measured. For these reasons, the definition of productivity used throughout will be output(s)/ input(s). This is illustrated as a systems diagram in the following figure.

756_Transforming Inputs into Outputs - Productivity Measures.png

To the politician productivity means money to spend on roads and hospitals; to the economist it is a comparative measure of the health, vitality and competitive strength of an economy; to an operations manager it is a comparative measure of improvement.  Productivity is important to everyone. We should constantly seek increases, so that the economy of the nation will continually produce an improving standard of living for all citizens.  The increase in gross national product in the US has increased around 1.7 per cent per annum for the past 10 years. For some Asian economies the increase was as high as 5 per cent. The productivity increase of 1.7 per cent according to Heizer and Render (2001) was due to a mix of inputs which contributed the following proportions: 

  • Capital contributed 38 per cent of the 1.7 per cent growth in the economy
  • Direct labour contributed 10 per cent of the 1.7 per cent growth in the economy
  • Management contributed 52 per cent of the 1.7 per cent growth in the economy

 

Measuring productivity is an effective way of determining a country's ability to improve living standards. Also, increasing productivity is the only way that labour and capital can achieve greater financial benefits. Productivity is a significant issue for all societies and one which operations managers must address. 

Despite varying individual perceptions of the concept, by the end of this chapter there should be little doubt in your mind that productivity is a critical issue to all not only within organisations but also nations, and that efficient operations can play a large role in the improvement of productivity. 

The major constituents are further broken down: 

  • Capital: level of capital investment and cost of capital
  • Labour: basic education and skills; diet and motivation; labour availability
  • Management: education and supply

 

From this breakdown it is clear that management makes a very significant contribution to a nation's GDP. The factors of greatest significance are education and supply. In a knowledge society change is brought about by people who are well educated and motivated who are given the opportunity to bring about improvements in their society. This analysis suggests that if countries wish to lever their productivity, then the education and training of management is their prime goal closely followed by the availability of capital and a conducive environment.


Related Discussions:- Transforming inputs into outputs - productivity measures

Explain what type of human resource strategy did lenovo, Overview: This cas...

Overview: This case explores the mission to become a major player in the global personal computer industry. Lenovo acquired IBM%u2019s personal computer division in 2004 to become

Explain how else might national origin discrimination occur, National origi...

National origin discrimination is prohibited against a job applicant or employee. Besides discriminating against the job applicant or employee directly, how else might national ori

Generate an ld score for the current layout, 1. Develop an ld score for the...

1. Develop an ld score for the current layout. What problems can you identify with the current layout? 2. Use trial and error to come up with a better layout that lowers the ld

Explain what are the four major goals for it, What are the four major goals...

What are the four major goals for IT? How are the four goals achieved? How does the integration of IT improve the management of supply chains?

Explain formal communication chain effective, Most organizations possess so...

Most organizations possess some formal organizational chart showing the established lines of authority and the division of labour. Generally, formal processes of communication are

Explain organizations achieving competitive advantage, Discuss the influenc...

Discuss the influence of the four focus areas for HR professionals on solving HRM related issues associated with organizations achieving competitive advantage.

Find cause the cost of capital to decrease, Due to changes in regulatory re...

Due to changes in regulatory requirements, the transactions costs associated with selling corporate securities increased by $1 per share. This change will Answer a. cause the co

Calculate the economic order quantity, A local nursery greens uses 1560 bag...

A local nursery greens uses 1560 bags of plant food annually. Green works 52 weeks per year. It costs $10 to place an order for plant food. The annual holding cost rate is $5 per b

Explain advantages of division of labour, Explain advantages of Division of...

Explain advantages of Division of Labour.  As the same worker does similar work repeatedly:- (i) It gains proficiency and skill on the job and becomes a professional. (ii

Explain accounting, Explain accounting. Accounting: It is an art of c...

Explain accounting. Accounting: It is an art of classifying and recording data. Now there data refers to transactions having monetary or financial values. As per to this, acc

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd