Types of Productivity in Operation Management

Types of Productivity in Operation Management

Productivity in operation management

Productivity in operation management is the ability of a business or organisation to do activities more effectively. This can be achieved through a variety of methods, such as cutting costs, enhancing quality and efficiency, and enhancing customer service.

Companies should explore using new technologies that enable them to do more with less in order to enhance productivity. For instance, they may be able to utilise machine learning software that enables them to monitor consumer requests and respond automatically. This would enable them to give superior customer service without requiring workers to manually respond to customer emails for hours.

Adding more resources (i.e., personnel) who are capable of managing high-volume work without requiring backup from other departments within the company’s structure is another option for businesses to enhance productivity (i.e., customer service). This can be achieved by hiring personnel with the specialised skill sets required for certain projects or tasks (e.g., computer programmers), as opposed to hiring everyone who appears qualified based on their job description alone.

Usually, there are three types of productivity in operation management or productivity measurements. These are Total ProductivityPartial Productivity and Factor Productivity.

Types of Productivity in Operation Management

  1. Partial productivity
  2. Total factor productivity
  3. Total productivity

 

Partial productivity

The ratio of output to partial input is the definition of partial productivity. It determines how productive each input is on its own. It establishes the extent to which each aspect contributes to the production and generation of output. Lets see how it is measured;

Here,

PP = Partial Productivity

O = Total Output

PI = Partial Input

The Partial productivity is given by(PP)= O/PI

Labor, capital, energy, machinery, and materials are some examples of partial inputs that can be used.

Some examples of partial productivity measurements are given below: 

Labor Productivity = Total Output / Labor Input
Capital Productivity = Total Output / Captial Input
Material Productivity = Total Output / Total raw material used
Energy Productivity = Total Output / Total energy used
Machinery Productivity = Total Output / Total machine hour used

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Total factor productivity

Total Factor Productivity (TFP) is a measure of an organization’s productivity that may be defined as the total output of a business divided by its input. 

The total factor productivity (TFP) is calculated by dividing total output by all inputs (labour, capital, and material).

Here,

TFP = Total factor productivity

O = Total Output

L = Labor

C = Capital

Thus,Total factor productivity(TFP) = O/L+C

Total factor productivity is frequently employed as a metric of economic growth. Taking into account all components involved in the production process, including labour and capital, enables one to determine how much value each individual contributes to the final product.

Total productivity

The term “Total Productivity” is used to represent the quantity of output or benefit created from a set of inputs. Increased output per unit of input is what this term describes.

The notion, which is commonly used to evaluate a company’s productivity, was devised by management guru Peter Drucker.

Lets see how the Total productivity is calculated;

TP = Total Productivity

O = Total Output

I = Total Input

So the Total productivity is given by(TP) = O/I

When calculating total productivity, all quantifiable factors and output must be taken into account.

It is preferable to depict the genuine economic conditions because it is more accurate. Top management can get a great deal of value from gaining control through the measurement of total productivity.

It is simple to establish a connection between overall productivity and total cost. However, calculating the data for total production is a highly real challenge. Intangible aspects of outputs and inputs, such as partial and total productivity, are not taken into account by this measure.

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