Productivity Measurement at National, International and Firm Level

productiveness Measurement at International, National and organization direct. PRODUCTIVITY measuring Productivity measurement is the quantification of both the produce and input resources of a productive system. The last of productiveness measurement is productiveness improvement, which involves a combination of enlarged trenchantness and a better use of available resources. enchantment productiveness can be lend oneself the sort of short hand interpretation as the ratio between output and input USE OF PRODUCTIVITY MEASURES Productivity is a required tool in evaluating and monitoring the death penalty of an organization, especially a business organization.When directed at particular proposition issues and problems, productivity measures can be real powerful. In essence, productivity measures argon the yardsticks of force playive resource use. Managers ar concerned with productivity as it relates to making improvements in their tauten. straitlaced use of product ivity measures can give the manager an indication of how to improve productivity either increase the numerator of the measure, decrease the denominator, or both. Managers argon also concerned with how productivity measures relate to competitiveness.If two firms have the selfsame(prenominal) level of output, but one requires less(prenominal) input this is due to a high level of productivity, that firm will be able to charge a trim back equipment casualty and increase its market portion or charge the same price as the competitor and enjoy a larger profit margin. Within a time period, productivity measures can be utilise to canvas the firms performance against manufacturing-wide data, examine its performance with confusable firms and competitors, compare performance among different departments at heart the firm, or compare the performance of the firm or case-by-case departments within the firm with the measures obtained at an ahead time.Productivity measures can also be us ed to evaluate the performance of an entire industry or the productivity of a uncouth as a whole. These are center measures determined by combining productivity measures of various companies, industries, or segments of the economy. NATIONAL aim step Since productivity is one of the staple fibre variables governing scotch production legal action some mention of national productivity concerns would be appropriate. As a librate of fact, productivity may be the near important variable governing sparing production activity.It is the fundamental controllable agentive role in wealth production. Since other economic variables depend on it, increasing productivity tends to have a beneficial multiplying effect on other economic variables. modify productivity is of national importance because, for a society to increase its standard of living, it moldiness first increase productivity. Overall productivity for individual countries is calculated by dividing output, as metrical by GDP or GNP, by the countrys total population.Thus, productivity is measured as the dollar value per capita outputs. An increase in this measure of productivity substance that each person in the country, on average, produced more goods and services. Also if productivity increases, and because profits increase. The resulting profits can then be used to pay for betroth increases (inherent in inflation) without having to raise prices. In this way, productivity gains actually help curb inflation. It has been estimated that technology was responsible for at least one-half of the return in productivity.It would appear, then, that if the country wants to refer to increase productivity, technology may be the key. ORGANIZATION take aim PRODUCTIVITY MEASUREMENT For an individual firm or industry, measures of taxation output, combined with labour, capital and intermediate inputs, train directly to a specific nonplus of a production function with apathetic or output-augmenting technical change. When multifactor productivityMFP measures are found on such a primitive-output image, MFP growth approximates the rate of neutral, disembodied technical change.Alternatively, MFP measures could be found on a value-added concept where value added is considered a firms output and only primary inputs are taken as a firms input. Value- added based productivity measures bounce an industrys capacity to transmit to economy- wide income and final demand. In this sense, they are valid complements to gross-output based measures. At the flux level of the economy, gross-output and value-added based measures converge when gross-output measures are defined as sectoral output.Sectoral output is a measure of production corrected for deliveries within a given sector. From this perspective also, gross-output and value-added based measures are complements. A useful schema in the development of productivity measures is to take with aggregate value-added based productivity measures the needed data tends to be relatively well available and the choice between gross output and value added makes less struggle than at the detailed industry level.INTERNATIONAL LEVEL PRODUCTIVITY MEASUREMENT NEED Interlinked fiscal systems Technology/ service transfer interior(prenominal) and regional competitions Valuable tool for paygrade Problems of Productivity Measurements at International level In exchange rate measurements (often prices of similar goods non compared). All industrial level data not available. Social, Political, cultural factors not included. Data for developing countries is lacking.