Productivity Measurement

Productivity Measurement is one of the most important functions of management to enable control of organizational and process performance. While managing performance is one of the key activities to achieve higher productivity, the relationship between performance and productivity measures are not so obvious. Productivity measures on any scale can be traced to a number of factors that are often linked in a chain-network affecting one another.

The traditional productivity measures are based on the efficient use of resources, particularly Labour. This has been lately changed to customer satisfaction which measures Productivity, Quality, Cost, Delivery, Safety and Morale. How are these measured and consolidated into an index that measures improvement from one period to another? What are the relative importance of these new multi-measures and how could they be made sensitive to the changing condition in the organization?