Productivity Estimation Essay

463 WordsAug 25, 20152 Pages
Productivity Estimation According to the European Association of National Productivity Centres (EANPC, 2005) productivity is “how efficiently and effectively products and services are being produced”, whereas commonly defined as the ratio of outputs to inputs.. One aspect of operations management relies on managing transformation of numerous inputs into a range of outputs, such as goods or services. But how we make sure whether this transformation process is efficient? When we talking about the efficiency of an organization usually it means its success in producing as large as possible an output from given set of inputs. Provided that all inputs and outputs were correctly measured, this usage would probably be generally accepted. The more productive organization is, the better it uses its resources. As the equation below Productivity = output/input This way of measurement can be used to measure productivity of work, machine, department or the whole organization. On the other hand, total productivity can be used when we want to measuring productivity for all inputs combined, such as labor, machines, and capital. For an instance, a company produces monthly outputs worth 8000$ of products. In addition, cost of all inputs combined is 4000$. The monthly total productivity would be as following: Total Productivity = output/input = $8,000/$4,000 = 2.0 However, total productivity is important to illustrate a company performance, and how it is doing as whole. As Paul Krugman once said: "Productivity isn't everything, but in the long run it is almost everything." In given case, the analysts think that home country automated equipments in home country cause a quite difference in productivity figures which is considers a factor of Numerous factors could make a different in the productivity figures such as production factors, management factors etc. Usually, it

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