Monday, April 23, 2012

Productivity - Definition

Productivity - Definitions
Productivity was mentioned probably for the first time in an article by Quesnay in 1766.
 
In 1883, Littre defined productivity as the "faculty to produce," that is, the desire to produce.
 
In 1950, the Organisation  for European Economic Cooperation (OEEC) provided the following  definition of productivity:  
"Productivity is the quotient obtained by dividing output by one of the factors of production. In this way it is possible to speak of the productivity of the capital, investment, or raw materials according to whether output is being considered in relation to capital, investment, or raw materials, etc."
 
 
Productivity may be defined as follows:
Productivity = Output/Input  (Kanawaty)
The term productivity can be used to assess or measure the extent to which a certain output can be extracted from a given input. The inputs of an enterprise are land and buildings, materials, plant machines and equipment, energy and human resources. The outputs are saleable products and services.
 
 
R .M . Barnes 
 
R.M. Barnes discussed production in chapter 1 of his book, Motion and Time Study: Design and Measurement of Work (1980). The chapter is actually titled as Productivity.
 
Barnes explained that in a broad sense, productivity is the ratio of output to some or all of the resources used to produce the output. Labor productivity may be defined as "output per labor hour." Capital productivity as output per unit capital input. All inputs contribute to the toal productivity of the firm. The focus in motion and time study is productivity of labor, machines, equipment, and facilities.
 
Barnes recommends that productivity of workers is measured as a ratio between output standard time and actual labor hour input.
 
Productivity of capital represented by machines and other operating facilities is of importance. Barnes identified speed of the equipment and the downtime as the two most important factors controlling productivity and costs. He mentioned steel mills as an example in this context.
 
References:
 
Barnes, R. M., Motion and Time Study Design and Measurement of Work, John Wiley & Sons, New York, 1980.
 
Kanawaty, Introduction to Work Study,  4th Edition,  International Labour Office, Geneva, 1992
 
Littre, Larousee Etymological Dictionary, 1946-49 edition.
 
OEEC, Terminology of Productivity, 1950.
Original knol - http://knol.google.com/k/narayana-rao/productivity-definition/2utb2lsm2k7a/566

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