Type of Productivity in Operation Management

Basically, there are following three type of productivity in Operation Management or types of productivity measurements.

Type of Productivity in Operation Management


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

1. Partial Productivity


Partial productivity is the ratio of output to partial input. It measures the productivity of each input.

It determines the contribution of each factor in producing and generating output. It can be measured as follows.

PP = O/PI

Where,

PP = Partial Productivity

O = Total Output

PI = Partial Input

Different partial inputs can be Labor, Capital, Energy, Machinery and materials, etc.

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

The partial productivity is easy to understand compute and can be highlighted to management.

These partial productivity data are available with a similar organization in the industry.

It makes easy to compare. It is thus a good diagnostic tool to pin point areas for productivity improvements.

However, partial productivity is misleading if done or used alone. It doesn’t explain the overall cost. So, increasing productivity via focusing on the new single area may not give a good result.

Example if an organization wants to increase labor productivity, simultaneously energy and material productivity has to be increased because these are associated with each other.

2. Total Factor Productivity


This is the ratio between total output on the one hand and labor and capital on the other hand. It can be expressed as:

TFP = O/L+C

Where,

TFP = Total factor productivity

O = Total Output

L = Labor

C = Capital

Total factor productivity has the benefit of easy calculation and more useful form economic view points.

3. Total Productivity


Total productivity is the ratio of total output to the sum of all inputs.

Thus, total productivity measures reflect the joint impact of all the inputs in producing and generating output.

TP = O/I

Where,

TP = Total Productivity

O = Total Output

I = Total Input

The total productivity considers all quantifiable factors and output.

It is more accurate to represent real economic condition. Control through total productivity measure is a tremendous benefit to top management.

Total productivity is easy to relate to total cost.

However, the data computation for total productivity is very difficult.

It does not consider intangible factors of outputs and inputs like partial and productivity measure.

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