Productivity Concept for the Current Millennium

A. PRODUCTIVITY – EARLY VERSIONS

Productivity, from 1940s (just after the 2nd World war), was considered as a domain of the Engineering faculty to analyse the relationships of the output that can be produced in a specified period of time. It was related to the concept of efficiency, which is the amount of output produced relative to the amount of resources (time and money) that go into the production. Improved productivity, benefits a business by lowering the cost and increases the leverage to compete better and make profit.

World labour and manufacturing organizations standardised the concept of Productivity as the ratio between the Physical output (Products) to the Physical input (Labour, material, power etc…) More output quantum with less input quantum, provides a higher and favourable Productivity index.

B. PRODUCTIVITY MOTIVATORS.

More productivity index has a direct impact on lowering the Cost per unit of the Output product, indirectly improves the profit of that product at a constant price and universally assists the continued existence and growth of the companies. Hence, the companies made attempts to increase the productivity in a variety of ways. The most obvious methods involve automation and computerisation which minimise the tasks that must be performed by employees. Recently, less obvious techniques are being employed that involve ergonomic design and worker comfort. It was found that a comfortable employee, can produce more than a counterpart who struggles throughout the day. In fact, some studies claim that measures such as raising workplace temperature can have a drastic effect on office productivity. Experiments done by the Japanese Shiseido corporation also suggested that productivity could be increased by means of perfuming or deodorising the air conditioning system of the workplaces.

Till 1990, the productivity motivators were constrained to the methodology, performance and profitability of individual corporate sectors.



C. PRODUCTIVITY DEPLOYMENT

During the post-2nd world war period (1947 to 1991) there was a Cold war situation in the world. It was a geopolitical (Territorial superiority), ideological (Ruling startegy superiority), and economic (International superiority) struggle between the capitalistic United States and its allies (West), and the communistic Soviet Union and its allies (East). It lasted from about 1947 to the period leading to the collapse of the Soviet Union on December 25, 1991.

During this period, both the Eastern and Western nations in cold war, drastically increased aggregate supply of various goods to prove their superiority. The deployed various productivity optimisation techniques to get drastically more output with a possibly less input.

This inducted an increases in the aggregate demand for these goods in the international market, covering the neutral, developing and under developed nations. These in turn, not only decreased the unemployment situation in both the Eastern and Western nations, but attracted a large scale immigration of labour from the developing and under developed world. As a result, the international inflation remained stable.

D. PRODUCTIVITY TAKE-OFF

Just after the end of cold war, during 1990s (from 1990 to 1999 inclusive) there was an economic expansion in the United States leading to a massive increase in worker productivity and globalisation (complex series of economic, social, technological, cultural and political changes with increasing interdependence, integration and interaction between people and companies in disparate locations). Key forces shaping this decade were the a global recession, due to the shift in the manufacturing process as well as the product delivery to remote locations, popularisation of personal computers, boom of the dot-com and the drastic rise in the Internet activities, particularly beginning from the early 1990s.

The productivity in this period assumed a new dimension of a small physical output creating a large value, while a large physical output creating only a small value. As a result, everything which were big or maxy prior to 1990s, started assuming the dimension of mini. (Automobile, Camera, Computers, Mobile, TV etc…)

It was atake-off period for a Globalised productivty. Increases in productivity also started influencing the society more broadly, by improving living standards, creating income, and generating economic growth. Because of this there were drastic changes in patterns of social behaviour, resulting from new communication technologies and changed/broadened male-female relationships.

This situation closed the gap between the Productivity and Management Decision process.

E. MANAGEMENT DECISION INTEGRATION.

Productivity is an output emerging from the basic management decision, which prefixes the quantum output as well as the selected quantum inputs. Productivity is hence preceded by the Input management decisions and the output management decisions. When the term productivity is globalised, then implicitly the term Management Decision is also gets globalised. Hence both Productivity and Management Decision should be measured with reference to a common globalised unit.

C. CURRENT PRODUCTIVITY DIMENSION

As a result of globalization and internet links, the scope and the concept of Productivity has broadened to a two dimensional unit, integrating the quantum productive needs of the corporate sectors as well as the socio-economic status of the nation. Similarly the Management Decision methodology is also broadened to the same dual units.

Corporate survival now greatly depends on the National socio-economic survival, through the broadened E-business scattered globally, appealing and attracting international social groups. Also the intangible factors of Psychological, Social, International and Universal dimensions have assumed a priority influence on the productivity as well as the management decision of all the government and private sectors. Hence, productivity along with management decision has to be measured through both the Quantum and Socio-economic development units (SED).

01. Productivity = SED goals/Input > 1 &

SED goals/Output > 1 subject to Quantum (Output/Input) > 1.

02. Social rate of return is important than Quantum rate of return.

03. Intangible elements are important than tangible elements. (Psychological, Social, Inter national, and Universal).

04. Management decisions are optimum when

SED goals/Input decisions > 1 &

SED goals/Output decisions > 1,

Subject to Output decisions/Input decisions > 1

05. This is universally applicable to all developed, developing and under-developed nations.

06. This proved through an Algebraic Model.

More details and the mathematical derivations on this new concept is available in “A Redefined Productivity and Socio-economic Development oriented Management Decisions" at http://www.drvsrs.com/mgmtfull.htm

DR.VSRS.

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