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 benefit would using the optimal order quantity, Garden Variety...

Garden Variety Flower Shop uses 760 clay pots a month. The pots are purchased at $2 each. Annual carrying costs per pot are estimated to be 30 percent of cost, and ordering costs a

Calculate five year moving averagetle.., The figures below indicate the num...

The figures below indicate the number of mergers that took place in the savings and loan industry over a 12-year period. Year Mergers Year Mergers 2000 46 2001 46 2002 62 2003 45 2

Explain good corporate citizen and moral agent, • Do corporations have a re...

• Do corporations have a responsibility to be a good corporate citizen and moral agent? What do these terms mean to you? Justify your opinion by providing examples. • If you wer

Trying to affect tangibles quality dimension, Dave noticed that at the plac...

Dave noticed that at the place where he gets his haircut, Hair Town, there is an employee who sweeps up hair every 15 minutes. By doing this, the management at Hair Town is trying

Explain mbo to improve the innovation process at gsli, Do you believe that ...

Do you believe that MBO is appropriate for an organization where the primary output is innovation? If not why not? If so, how would you apply MBO to improve the innovation process

Interaction - service process matrix, Interaction - Service Process Matrix ...

Interaction - Service Process Matrix Interaction refers to the degree to which the customer can intervene in the process (eg in a restaurant, the customer may call a waiter at

Explain what is the purpose of a provider contract, What is the purpose of ...

What is the purpose of a provider contract? What intentions are enclosed in a provider contract and why is it important to detail party relationships, services, obligations, and ob

Explain aggregate planning in manufacturing, What is the major difference b...

What is the major difference between aggregate planning in manufacturing and aggregate planning in services? Provide and explain to examples.

Value driven approach , Value Driven Approach The second approach is a...

Value Driven Approach The second approach is a value drive approach to operations management. The value driven approach starts by recognizing that a business is a set of proce

How examine his deposit box, Several weeks after a depositor's death, Chase...

Several weeks after a depositor's death, Chase Manhattan Bank paid 12 checks on the deceased depositor's account. The depositor's signature on the checks had been forged. The estat

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