What is Productivity by Operational Excellence Consulting


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Productivity Concept & Principles:

Productivity Concept & Principles

What is Productivity (Technical Concept)?:

What is Productivity (Technical Concept)? The term productivity is a broad concept which involves two major aspects. Output refers to the product of an operation, or result of special interest. Input refers to the resources consumed in the production or delivery of output. Output Input PRODUCTIVITY =

What is Productivity (Technical Concept)?:

What is Productivity (Technical Concept)? Problems with the technical concept: Increase in productivity with poor quality of output. Increase labor productivity due to labor reduction may lead to labor-management conflict. To overcome this problem, the concept of productivity as a broad social concept has been introduced.

What is Productivity (Social Concept)?:

What is Productivity (Social Concept)? “Productivity is, above all, an attitude of mind. It seeks to continually improve what already exists. It is based on the belief that one can do things better today than yesterday and better tomorrow than today.” - Asian Productivity Organization An innate wish of everyone to make tomorrow better than today. Aims to achieve a better quality of life for all.

What is Productivity (Economic Concept)?:

What is Productivity (Economic Concept)? Refers to one’s ability to create more value for customers. For most business organizations, the economic goal and basis for existence is value creation. Economic gains is measured in terms of value added - increases in inputs or improvements in productivity.

What is Productivity (Economic Concept)?:

What is Productivity (Economic Concept)? In most cases, increases in value added are attained through expansion in capital and labor. However , a productivity driven growth model focuses on resource efficiency and output superiority to create higher value to customers. Hence , a long-term sustainable growth in the economy cannot depend on expansion strategy alone.

What is Productivity (Management Concept)?:

What is Productivity (Management Concept)? Productivity is doing the right things right This concept of productivity provides a working definition to manage and improve productivity at micro or organization levels . Efficiency + Effectiveness PRODUCTIVITY =

What is Productivity?:

What is Productivity? As an integrated concept : As an objective  Social concept As a means  T echnical concept Productivity-driven economic growth as a long term strategy Improve the quality of labor and capital Output Input PRODUCTIVITY =

Productivity Principles:

Productivity Principles Principle of Increase in Employment Improved productivity increases employment Principle of Labor-Management Cooperation In improving productivity, labor and management must cooperate in discussing the measures Principle of Fair Distribution The fruits of productivity improvement must be distributed fairly among key stakeholders

Multi-Factor Productivity:

Multi-Factor Productivity Output No. of Employees (No. of hours worked) Labor productivity = Output (value or unit or value added) Raw material used Raw materials productivity =

Approaches to Improving Productivity:

Approaches to Improving P roductivity Reducing the 3 MU’s – Muda , Mura and Muri Implementing the 5M + Quality + Safety Improving the flow of goods and services Bottlenecks Reducing the Cost of Poor Q uality


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