1 / 96

THE CONCEPT OF PRODUCTIVITY & ITS IMPLEMENTATION

THE CONCEPT OF PRODUCTIVITY & ITS IMPLEMENTATION. BY T.M.JAYASEKERA. THE CONCEPT OF PRODUCTIVITY & ITS IMPLEMENTATION. PRESENTED BY T.M.JAYASEKERA B.Sc. Eng. MBA,C.Eng. FIE,FCIWEM,FIM.,FIMGT, MSLIM, MICE(Lond) Managing Director -Innovative Skills (Pvt.) Ltd

issac
Télécharger la présentation

THE CONCEPT OF PRODUCTIVITY & ITS IMPLEMENTATION

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. THE CONCEPT OF PRODUCTIVITY & ITS IMPLEMENTATION BY T.M.JAYASEKERA

  2. THE CONCEPT OF PRODUCTIVITY & ITS IMPLEMENTATION PRESENTED BY T.M.JAYASEKERAB.Sc. Eng. MBA,C.Eng. FIE,FCIWEM,FIM.,FIMGT, MSLIM, MICE(Lond) Managing Director -Innovative Skills (Pvt.) Ltd 291/50.Havelock Gardens ,Colombo -6-Tel/Fax594378

  3. PRODUCTIVITY • What is it? • Why do we need it? • How do we measure it? • How do we improve it? • How do we implement it ?

  4. RESOURCES OF AN ORGANIZATION • Whether Public or Private;The resources that are available to them are: • Land & Buildings • Materials • Plant, Machines & Equipment • Energy • People • Money

  5. DEFINITION OF PRODUCTIVITY • Very simply, • Productivity = Output Input For any type of organization

  6. EXAMPLES OF OUTPUT • Whether the organization is public or private the outputs are ; • Accomplishment of a task • Length of an output • Distance travelled • Number of pieces produced • Weight of production

  7. EXAMPLES OF OUTPUT(Contd.) • Volume of output • Value of output • No. of documents processed • Time taken to carry out a job • No of jobs attended • No. of customers served

  8. EXAMPLES OF INPUT • Labour force or man hours, man days. Etc.. • Labour cost (Rs) • Area of land(in hectares) • Kg. Of material or material cost in Rs. • Volume of material or fluid • Length of material • square area of space • Units of power • Time etc.

  9. IMPROVING PRODUCTIVITY • Output = • Input • Methods of improving Productivity • Increase output while input remains same • Decrease input while output remains same • Increase input resulting in a very large increase in output • Decrease input by a very large amount with a resultant small reduction in output

  10. TYPES OF PRODUCTIVITY MEASURES • Single Factor productivity • Multi Factor Productivity • Total Factor Productivity

  11. OTHER THOUGHTS ON PRODUCTIVITY • “Productivity is an attitude of mind” • “Productivity means doing something better today than yesterday” • “Productivity means continuous improvement”

  12. ACCORDING TO MICHAEL PORTER • “…The wealthy nations they are the productive nations…” • “…Productivity makes you wealthy, it allows you to support high wages, it allows you to support high returns on capital…” • Michael Porter

  13. WHY PRODUCTIVITY IS IMPORTANT Higher standard of living • Higher GDP • per capita Higher Investment Higher Productivity

  14. ARE WE STILL THE SECOND HIGHEST IN ASIA IN LITERACY? NO! We are not even in the first ten today. Countries with stronger economies have beaten us.

  15. THE NEED OF THE HOUR Massive Investment ! Massive increases in productivity !

  16. THE BASIC APPROACHES TO PRODUCTIVITY IMPROVEMENT • Investment in high output and modern plant & equipment and new technology - capital intensive approach • Improving the efficiency and effectiveness of existing resources - better management approach

  17. THE TWO ASPECTS OF PRODUCTIVITY • The “soft” or qualitative aspects • - to create an environment conducive to productivity • The technical or quantitative aspect • - to measure productivity

  18. THE ‘SOFT’ ASPECTS OF PRODUCTIVITY • Productivity culture • Team work • Quality work • “Delighting” customers • Work ethic • Caring for the work force

  19. The quantitative aspects of productivity • By this is meant the concepts behind productivity measurement and their application to performance measurement at the economy and company level

  20. PRODUCTIVITY LEVELS • National Productivity • Industry Productivity • Company Productivity • Divisional Productivity • Branch Productivity • Individual Productivity

  21. NATIONAL PRODUCTIVITY =GDP EMPLOYED WORK FORCE This is a single factor productivity measure and therefore wrong inferences may be made by comparing one country with another

  22. PRODUCTIVITY OF SRILANKA • How do we compare with others in Asia • What inferences can we draw

  23. ORGANIZATION PRODUCTIVITY- HOW TO MEASURE ? The best method is to use Added Value( as output) per single factor of output (Added value measures the wealth creation)

  24. Calculating Added Value • The subtraction method: (Wealth Generation Approach) Added Value = Total output less Bought-in materials and services The Addition method (Wealth Distribution Approach) Added Value = Labour cost + Depreciation + Taxes + Interest + Profit

  25. EXAMPLES OF ADDED VALUE • Added Value per employee • Added Value per Rs of labour cost • Added Value per Kg of material • Added Value per KWH of power • Added Value per litre of fuel

  26. MICRO-LEVEL PRODUCTIVITY INDICATORS • Ratios which measure: • Competitiveness • Labour productivity • Capital productivity • Business Returns & profitability • Process Efficiency

  27. COMPARING PRODUCTIVITY • Cross sectional comparison • Time series comparison

  28. PRODUCTIVITY IS ALSO... • EFFICIENCY (Doing things right) + • EFFECTIVENESS (Doing the right things) “Do the right thing and do it right now”

  29. MISCONCEPTIONS ABOUT PRODUCTIVITY • People fear, hate, feel let down, complain about productivity, very often because they have misunderstood it. • There are several misconceptions about Productivity

  30. MISCONCEPTION - I • Productivity = Production • Productivity is merely a more “sophisticated” word for production

  31. MISCONCEPTION - II Productivity means only Labour Productivity

  32. MISCONCEPTION - 3 • Productivity can be increased by getting people to work harder • TRUE TO SOME EXTENT • But this is labour intensity NOT real • productivity. Real productivity means • working more intelligently • not harder

  33. MISCONCEPTION -4 • Higher productivity causes retrenchment and large scale loss of jobs • This may happen in the short term but the long term benefits outweigh this disadvantage

  34. Misconception -4(Contd.) If there is low productivity then in the long term there will be severe, large scale loss of jobs.

  35. MISCONCEPTION - 5 Productivity is relevant only in manufacturing and not relevant elsewhere

  36. MISCONCEPTION - 6 Productivity can be increased by cutting costs across the board

  37. MISCONCEPTION - 7 Productivity and Quality are trade offs. You cannot increase one without affecting the other

  38. MISCONCEPTION - 8 Productivity is directly related to profits. In other words a profitable organization is always a productive one

  39. MISCONCEPTION - 9 Productivity is relevant only in an open economy

  40. MISCONCEPTION- 10 Productivity is only for commercial enterprises and not for the public sector

  41. MISCONCEPTION - 11 Productivity is for organizations and not for you and me

  42. SO DO NOT GET MISLED BY THESE MISCONCEPTIONS

  43. HOW DO WE IMPROVE PRODUCTIVITY First point to remember is the M I G cycle

  44. THE M I G CYCLE GAIN SHARE MEASURE IMPROVE

  45. THE PROFIT GOAL PROFIT = REVENUE - COSTS

  46. MAJOR STEPS Analyze the Revenues Analyze the Costs And then Prioritize Find the Vital Few Components of cost

  47. ANALYZE REVENUE SOURCES

  48. ANALYZE COSTS

  49. CLOSELY LOOK AT Labour costs Material costs Energy costs Finance costs Overhead costs

  50. IMPROVING LABOUR PRODUCTIVITY • Improving working conditions- lighting, ventilation, noise(music), temperature, work times • Using appropriate and better tools • Ergonomics and better work station layout. • Improving factory, stores & office layout. • Improving the method/process - use 5Ws & IH • Improving the nutritional status of the worker • Improving industrial housekeeping(5s) and safety • Improving welfare facilities and worker motivation

More Related