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Productivity = Output. Input. What is Productivity. Productivity is a Measure of Performance Individual -- Group -- Organization -- Nation. Organizational Performance. Profitability Effectiveness Efficiency Cycle time Quality. Quality of Work life Innovation Utilization

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Productivity = Output

Input

What is Productivity

Productivity is a Measure of Performance

Individual -- Group -- Organization -- Nation


Organizational Performance

Profitability

Effectiveness

Efficiency

Cycle time

Quality

Quality of Work life

Innovation

Utilization

Productivity

Sink et al. (1984)


As a manager, what needs to know ?

Why we need the measures

Objectives -- Goals

Method -- Path

Achievement

Are we really up here?


How Measures are used?

Historical comparison

Compared with a base year (Index)

Compared with competitors

Compared with some certain standards

Benchmarking


Process

Input ??

Productivity Measurement

Perspectives of productivity

  • Narrow Perspective

  • B r o a d Perspective


Productivity

Measurement Techniques

  • Partial Productivity

  • Multi Factor Productivity

  • Normative Performance

  • Multi Criteria Performance


Productivity = Output

Input

PROs

VS

CONs

Partial Productivity

Labor Productivity

Capital Productivity

“Capital-labor substitution”


Multi-Factor Productivity

  • Consider all output & input at the same time and Convert things to price-based unit

  • Two models

    • Total Productivity

    • Total Factor Productivity


Total Productivity = Total tangible outputs

Total tangible inputs

Total Productivity

  • Define & Calculate Inputs

  • Define & Calculate Outputs

  • Develop data collection system


Total Productivity = Total tangible outputs

Total tangible inputs

PROs

VS

CONs

Outputs = Finished goods + WIP + All incomes(such as interests, dividends, rents, etc.)

Inputs = Capitals (fixed & working) + Materials + Energy + Human + Other expenses



Total Factor Productivity = Total Value Added

Total Factor Input

PROs

VS

CONs

  • Output is total gain from operation

  • Value Added = Net sales - Cost of good sold - Outsource services

  • Value Added = Net profit + Salary + Retained earning + Interest + Tax + Rent + Depreciation


Dimensions of Productivity

Quality Cost Delivery for customers

Ethics Environment for everyone

Safety Morale for employee

สถาบันเพิ่มผลผลิตแห่งชาติ : QCDSMEE


PROs

VS

CONs

Normative Performance

Broad view

Structured group process

Delphi Technique


PROs

VS

CONs

Multi-Criteria Performance

  • Aggregate various measures created by Normative approach in an integrated fashion

  • Develop a new scale (Index)

  • For example: Objectives Matrix, Balanced Scorecard


Objectives Matrix

  • Construction Steps

  • Determine all possible measures

  • Rate the importance of measures

  • Develop overall Performance Index

Output is a Family of Measures (a weighted index of performance)



Objectives Matrix

Measurement Design

Accountant

Cook

Lecturer

Student

Home Service

Delivery Boy


Productivity Taxonomy

Select the right model

  • Dimensions for classification

  • TD1: Unit of Analysis

  • TD2: Time Frame for Measurement


Taxonomy: the guideline

Ind.

Firm

Plant

Dept

Group

Indv’l

  • MA

  • MF MF MF

  • MF MF MF

  • MC MC MC MC

  • MC MC MC MC

  • WM WM

Min Hrs Days Wk Mth Qtr Year


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