Useful Productivity Techniques

Productivity

 As owner/manager of a small enterprise manufacturing garments we

want to succeed and grow.

 We continuously implement improvements in conditions of work and

environment listed in your action plan to increase your productivity
and profitability.

 But do we know how much we have improved and what benefits

have we gained from the implementation of a particular
improvement?

 Do we know whether we have recovered your costs?

 Productivity

 Productivity measurement indeed is an additional activity but it has

numerous benefits.

 And if the system for gathering data is simple, then little time and
effort are required to do the job.

 In all cases, you need to be systematic and keep records of data

useful for different productivity indicators.

 The sooner you start gathering data, the quicker you will be able to
assess your productivity.
Productivity

Remember –

What is important for productivity is to compare data (how was the

situation before and how it is now?) and trends (how slow or fast is
the situation improving?).
Benefits of Productivity Measurement

 Productivity measurement enables an enterprise to assess the

efficiency of conversion of its resources to goods.

 Based on this assessment, the enterprise would know whether it is

doing well or badly and therefore could take the necessary action to
produce more goods for a given amount of resources used.

 Measurement enables the enterprise to do resource planning and to set

quantifiable objectives of productivity levels at which it ought to be
operating.
Benefits of Productivity Measurement

 Productivity measurement also enables an enterprise to know whether

it is improving its profitability through productivity.

 Moreover, productivity measurement enables an enterprise to know

the results of management decisions, to monitor progress, and to
provide feedback.

 Thus, measurement is integral to the productivity management process.

What is Productivity?

Productivity can be defined in many ways but, technically, it is the

relationship between output and input:

where output refers to the goods produced by an enterprise and input

refers to the resources used to produce the outputs.

Examples of outputs are: pieces of jackets, pieces of shirts, pieces of baby

dresses, and others.

Examples of inputs are: metres of fabric, kilowatt-hours, worker-hours,

machine-hours and others.
 What is Productivity?

The term "productivity" is often confused with the term "production'.

Many people think that the greater the production, the greater the
productivity. This is not necessarily true.

 Production is concerned with the activity of producing goods.

 Productivity is concerned with the efficient utilization of

resources (inputs) in producing goods (outputs).

In quantitative terms, production is the quantity of outputs produced,

while productivity is the ratio of output produced to the input(s) used.
Basic Productivity Measurement

Partial productivity is the ratio of output to one class of input.

For example, labour productivity (the ratio of output to labour input) is a

partial measure. Similarly, material productivity (the ratio of output to
material input) and machine productivity (the ratio of output to machine
input) are examples of partial productivities.

Total productivity is the ratio of total output to the sum of all input
factors.

Thus, a total productivity measure reflects the joint impact of all inputs in
producing the output. It is a kind of a higher level of productivity
assessment combining several or many partial productivity measures.
How to Measure Productivity?

 Productivity is the relationship between the output of an enterprise and

its required inputs.

 Productivity can be quantified by dividing the outputs by the inputs.

 Productivity increase could be achieved by improving the output and

input ratio; that is, by producing more output, or better output, with a
given level of input resources; or by producing the same level and quality
of output but reducing the level of required inputs.
How to Measure Productivity?

While it seems so simple, actual computation is not that easy because

application of the formulas is not that straightforward.

A number of problems are encountered, among which are:

 difficulty in gathering all the data required

 difficulty in converting all outputs and inputs into a common

unit of measure

 difficulty in incorporating all factors affecting the productivity

index, such as price fluctuations, quality differences and product
mix.
Qualitative Productivity Indicators
These indicators may provide information on very different issues; the most
commonly used are:

 Higher morale of workers : enthusiasm, happy faces, high sense of

belonging, high level of initiative, high sense of accomplishment, fast
pace of work and cooperation.

 Improvements in the work environment : more spacious, cleaner, and

more organized workplace.

 Reduced effort in doing work: Tasks have been organized appropriately

to reduce repetition and physical workload. Workers are less fatigued and
more productive throughout the day.
Qualitative Productivity Indicators
These indicators may provide information on very different issues; the most
commonly used are:

 Improved communication : Regular information meetings are held.

There are fewer grievances and quarrels.

 Improved labour-management relations : There is a growing shared

trust, concern and cooperation from both labour and management.
Labour turnover is reduced.

 Better customer satisfaction : The enterprise receives positive feedback

and more orders from clients.

 Improved image and reputation of the enterprise : Clients, suppliers,

visitors and the community as a whole give positive feedback about the
enterprise.
Quantitative Productivity Indicators

 increase in volume of outputs;  reduction in machine downtime;

 improved quality of products;  reduction in overtime;

 reduction in volume of rework;  reduction in space cost per unit value of

 reduction in volume of rejects; product;

 reduction in number of late  reduction in turnover of employees;

deliveries;  reduction in sick-leave;

 reduction in number of work-  more customers;

related accidents;  increased number of improvement

 reduction in absenteeism; suggestions;

 reduction in number of machine  reduction in complaints;

breakdown;  higher profits.

Standard Productivity Indexes
Standard Productivity Indexes
Productivity, Efficiency and Effectiveness

Quite often the terms productivity, efficiency and effectiveness are confused
with each other.

 Efficiency is the ratio of actual output attained to standard output

expected.

 For example, if the output of an operator is 100 pieces of collars per

day while the standard rate is 150 pieces a day, the operator's
efficiency is 100/150 = 0.667 or 66.7 per cent.

 Effectiveness, on the other hand, is the degree of accomplishment of

objectives.
 Productivity, Efficiency and Effectiveness

A person could be effective without being efficient.

For example, a project manager may have accomplished the objectives of

an assignment very successfully, but if the cost for implementing the
project was very high or the project was completed behind schedule,
then he or she may have been effective but not efficient.

Some people differentiate efficiency and effectiveness as follows:

Efficiency is doing things right and effectiveness is doing the right things.

Productivity is a combination of efficiency and effectiveness.

Hence, it is doing the right things right.

Thank You