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

Compute the composite rating-weighted average, A location analysis for Temp...

A location analysis for Temponi Controls, a small manufacturer of parts for high-technology cable systems, has been narrowed down to four locations. Temponi will need to train asse

Explain quality improvement programs, Some have argued the Six Sigma progra...

Some have argued the Six Sigma programs are merely repackaged versions of older quality improvement programs that originally accompanied TQM initiatives in the 1980s. Present argum

Explain collective bargaining process is seniority, One of the most importa...

One of the most important issues discussed in the collective bargaining process is seniority. It is one of those components of the workplace that seems to impact every worker, whet

Explain what is the present value of each investment, You must choose betwe...

You must choose between two passive investments. Investment A requires an initial investment of $50,000 but will return $71,000 in three years. Investment B requires an initial inv

Explain develop an aggregate production plan, ABC Company, a manufacturer o...

ABC Company, a manufacturer of roofing supplies, has developed monthly forecasts for roofing tiles. The forecasted demand and the expected production days for months March to Augus

Explain static and dynamic scheduling problems, 1. What are the implication...

1. What are the implications of not allocating material in a shop order after availability checking? 2. Provide some examples of static and dynamic scheduling problems.

Consider the one-period-ahead forecasts, Do NOT use Minitab for this proble...

Do NOT use Minitab for this problem; you may use Excel. Handy, Inc. produces a solar powered electronic calculator that has experienced the following monthly sales history for the

Describe what is the probability that you will make money, The owner of Fir...

The owner of Firewood To Go is considering buying a hydraulic wood splitter which sells for $50000. He figures it will cost an additional $100 per cord to purchase and split wood w

Explain customer spend at the service desk, Sharp Discounts Wholesale Club ...

Sharp Discounts Wholesale Club has two service desks, one at each entrance of the store. Customers arrive at each service desk at an average of one every six minutes. Sharp Discoun

Analyse the cost - benefits and resources , Undertake Systems based analysi...

Undertake Systems based analysis, including: i. Developing a systems based diagnosis of the ‘situation'; ii. Analyse one or more processes which are considered to be problem

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