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 successful in developing a business model, Do you anticipate that F...

Do you anticipate that Facebook will ever be successful in developing a business model that monetizes their site traffic even further? When they had their public offering, the valu

Explain the system utilization rate and the probability, Sid Das Brick Dist...

Sid Das Brick Distributors currently employs 1 worker whose job is to load bricks on outgoing company trucks. An average of 24 trucks per day, or 3 per hour, arrive at the loading

Explain factors that influence an organizational structure, Discuss at leas...

Discuss at least three factors that influence how an mnc selects an organizational structure

Describe is it important to stress quality in a logistic sys, Is it importa...

Is it important to stress quality in a logistic system?

Explain ethernet network with a fddi network, A bridge that is used to conn...

A bridge that is used to connect an Ethernet network with a FDDI network must be practicing what type of bridging?

The role of computers in POM, Obsolete technology can cost an organisation ...

Obsolete technology can cost an organisation its customers.Explain the role of computers in production and operations management

Explain forecast including trend for the month, A manufacturer of printed c...

A manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. At the end of December, the company wishes to forecast sal

Explain disadvantages from the healthcare organizations, Determine two adva...

Determine two advantages and two disadvantages from the healthcare organizations perspective for requiring a Certificate4 of Need (CON). Identify 3 states that require a Certificat

What is the expected cost per period of the photocopier, Suppose that at an...

Suppose that at any period of time a photo-copier machine can either be working properly, in need of maintenance, in need of minor repair, or in need of major repair. If the photoc

Explain decision alternative and state of nature, A payoff a. is always mea...

A payoff a. is always measured in profit. b. is always measured in cost. c. exists for each pair of decision alternative and state of nature. d. exists for each state of nature.

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