Here is an essay on the ‘Productivity in an Organization’ for class 11 and 12. Find paragraphs, long and short essays on the ‘Productivity in an Organization’ especially written for school and management students.  

Essay on Productivity

Essay Contents:

  1. Essay on the Definitions of Productivity
  2. Essay on the Importance of Productivity
  3. Essay on the Factors Affecting Productivity
  4. Essay on the Ways for Increasing Productivity
  5. Essay on the Measurement of Productivity

Essay # 1. Definitions of Productivity:


In general sense, productivity is some relationship between inputs and output of an enterprise. It is the quantitative relationship between what we produce and the resources used. The only way of raising the living standard of the society is to increase productivity. Productivity can be increased by increasing output from each unit of input.

The level of concepts of productivity measurement is many sided. It can relate to every item/activity on which money is spent to get the final product.

Some of the definitions, given below explain the fundamental concept of productivity:

(i) Productivity is measure of how much input is required to produce a given output i.e. it is ratio of output to input.


(ii) Productivity is the ratio between the amount produced and the amount of resources used in the course of production. The resources may be any combination of materials, machines, men and space.

(iii) European productivity council defines “Productivity is an attitude of mind. It is a mentality of progress, of the constant improvement of that which exists; it is the certainty of being able to do better than yesterday and continuously. It is constant adaptation of economic and social life to changing conditions. It is continual effort to apply new techniques and methods. It is the faith in human progress.”

(iv) According to Peter Drucker, “Productivity means balance between all factors of production that will give the maximum output with the smallest effort.”

(v) I.L.O. generally takes productivity to mean, “The ratio between the volume of output as measured by production indices and the corresponding volume of labour input as measured by employment indices.”


(vi) Organization of European Economic Community (OEEC) defines productivity as the ratio between the production of given commodity measured by volume and one or more of the corresponding input factors also measured by volume. Thus there can be a number of measures indicating the level of performance corresponding to each input. In general sense, productivity is measure how much input is required to produce a given output i.e.,

Inputs in a business organization can be labour, capital etc. The measures can be expressed in terms of money value or in terms of quantity. In most cases output will be goods and services produced, for which input will be men, money, equipment, power, plant facilities and other items used in the process of production.

Total productivity of the firm can be defined as:

where PT: Total productivity

L = Labour input

C = Capital input

R = Raw material and purchased parts input


M = Other miscellaneous goods and services input factors

QT = Total output

All the input and output factors are measured in some common unit. Productivity is a measure of how well the resources are utilized to achieve given objectives.

Essay # 2. Importance of Productivity:


The concept of productivity is of great significance for undeveloped and developing countries. In both the cases there are limited resources that should be used to get the maximum output i.e. there should be tendency to perform a job by cheaper, safer and quicker ways.

The aim should be optimum use of resource so as to provide maximum satisfaction with minimum efforts and expenditure. Productivity analysis and measures indicate the stages and situations where improvement in the working of inputs is possible to increase the output.

The productivity indicators can be used for different purposes viz. comparison of performances for various organizations, contribution of different input factors, bargaining with trade unions etc.

Essay # 3. Factors Affecting Productivity:


All the factors, which are related to input and output components of a production process, are likely to affect Productivity.

These factors can be divided in two main categories, namely:

Category I:

(a) Primary factors are effort and working capacity of an individual.

(b) Organizational factors are related to the design and transformation process required to produce some item, the nature of training and other skill imparted to workers to perform certain operations in a production process, control and various other incentives.

(c) Conventions and traditions of the organization e.g. activities of labour unions, medical facilities, workers and executives understanding etc.


Category II:

(i) Factors related to output: research and development techniques, improvement in technology and efficient sales strategy of the organization will lead to improvement in output.

(ii) Efficient use of input resources, better stores control, production control policy, maintenance of machines etc. will minimize the cost of production.

The factors listed in categories I and II can be further divided in four major classes viz.:

(i) Technological

(ii) Managerial


(iii) Labor and

(iv) External factors.

The technological factors can increase the output per unit of input substantially. These can be defined in-terms of technology employed, tools and raw material used etc. Managerial factors can be located in organizational structure, scheduling of work, financial management layout, innovations, personnel policies and practices, work environment, material management etc.

Labor factors are characterized by the degree of skills of the works force, health, attitude towards management, training, and discipline. Greater the congruence between the skills of work force and technology employed better would be the productivity.

External factors are innumerable and identifiable in the environment with which an organization has to interact e.g. the power and transport facilities, tariffs and taxes etc. have important bearing on the levels of productivity. Some of these factors are controllable and some are uncontrollable and a demarcation should be made between the two.

Essay # 4. Ways for Increasing Productivity:


Productivity can be increased in a number of ways. It can be increased either by reducing the input for the same level of output or by increasing the output with the same level of input or by combination of both. This can be achieved by elimination of waste, by using improved technology, better production design and management efforts.

There can be increase in productivity by reducing down time of maintenance, reduction in material input, better quality of goods, improved utilization of resources, reduction in working capital requirements, reduction in inventory size, improvement in manpower skills through training etc. Better leadership management can increase output. When employees are better motivated, output can be increased.

Decision-making is a key factor, which affects productivity. Better decisions obtained through adequate and timely information systems definitely will improve effectiveness and efficiency of the organization.

Techniques to Improve Productivity:

Productivity can be considerably improved by improving the performance of various factors affecting productivity.

The measures to improve productivity can be:


(i) Better planning and training of employees, improved jobs and communication and effective management through CPM/PERT methods.

(ii) Use of time and motion studies to study and improve work performance. It enables to assess the quantum of work, which can be used for planning and control.

(iii) Better transportation and material handling system.

(iv) By providing work incentives and other benefits to workers.

(v) Workers involvement in decision making and working of organizations.

(vi) Improvement in technology of production process and nature of raw-material and its quality


(vii) Simplification, standardization and specialization technique.

(viii) Better and efficient utilization of resources at the disposal of the enterprises.

(ix) Use of linear programming and other quantitative techniques for better decision making.

(x) ABC analysis to identify more important items and then apply inventory control to reduce capital investment

(xi) Value engineering to reduce material content by good design.

Essay # 5. Measurement of Productivity:

There are a number of ways to measure productivity.

The main criterion of measuring productivity are:

(i) In terms of input performance by calculating changes in output per unit of Input

(ii) On the basis of output performance by calculating change in input per unit of output.

Following are some of the measures in common use:

Where output can be measured in total quantity produced and labor can be measured in total man-hours required to produce that output. Output and labor can also be measured in terms of their value in money units. Turnover/capital employed

A general measure of productivity can be defined as:

Each kind of measure needs some specific kind of information. The appropriate measure can be selected on the basis of the information available and the objective measure can be selected on the basis of the information available and the object of the investigation.

In fact the measure of productivity indicates the performance of inputs namely labor and capital in an enterprise. Increase in output is not an indication of increase in productivity. Production is an absolute measure and productivity is a relative measure.