Production Management

2. Presented by
Swapnil mayekar 76
Afiya Malek 71
Jai Navrekar 90
Ajith kurup 67
Evanshi bhojak 14
Malathi

3. Introduction
 Productivity is an overall measure of the ability to produce a good or service.
 productivity is the measure of how specified resources are managed to accomplish
timely objectives as stated in terms of quantity and quality.
 Productivity may also be defined as an index that measures output (goods and
services) relative to the input (labor, materials, energy, etc., used to produce the
output).

4.  There are two major ways to increase productivity: increase the numerator
(output) or decrease the denominator (input).
 Productivity is often confused with efficiency. Efficiency is generally
seen as the ratio of the time needed to perform a task to
some predetermined standard time.
 However, doing unnecessary work efficiently is not exactly being
productive.
Cont.…..

5. FORMS OF PRODUCTIVITY
Partial Factor Productivity
Multi Factor Productivity
Total Factor Productivity

6. FORMS OF PRODUCTIVITY
 The standard definition of productivity is
actually what is known as a partial factor
measure of productivity, in the sense that it
only considers a single input in the ratio.
 The formula then for partial-factor
productivity would be the ratio of total output
to a single input.
 Managers generally utilize partial productivity
measures because the data is readily available.
 since the total of multifactor measures
provides an aggregate perspective, partial
factor productivity measures are easier to
relate to specific processes.
Partial Factor Productivity Advantages

7. FORMS OF PRODUCTIVITY
A multifactor productivity measure utilizes more
than a single factor, for example, both labor and
capital. multifactor productivity is the ratio of
total output to a subset of inputs.
 In contrast to the partial productivity that
represents output per unit of labor or any other
single attribute , the multifactor productivity
relates output per unit of a combined set of
inputs. The term inputs typically refers to
items such as labor, capital, land and
intermediate inputs.
Multi Factor Productivity Advantages

8. FORMS OF PRODUCTIVITY
 A broader gauge of productivity, total
factor productivity is measured by
combining the effects of all the resources
used in the production of goods and
services (labor, capital, raw material,
energy, etc.) and dividing it into the
output.
 Total productivity ratios reflect
simultaneous changes in outputs and
inputs.
 total productivity ratios provide the most
inclusive type of index for measuring
productivity and may be preferred in
making comparisons of productivity.
Total Factor Productivity Advantages

9.  Productivity is a required tool for monitoring the performance of an
organisation, especially business organisation. In essence ,productivity
measures are the yardsticks of effective resource use.
 When directed at specific issues and problems, productivity measures can be
very powerful.
 Proper use of productivity measures can indicate manager of how to improve
productivity

10.  Productivity measures are used to compare the firm’s performance against industry,
competitors, different departments within the firm.
 Managers are concerned with how productivity measures relate to competitiveness.
 Thus productivity measures are used to evaluate the performance of an entire industry
or productivity of a country as a whole.

11. PRODUCTIVITY INDEX
Since productivity is a relative measure, for it to be meaningful or useful it must be
compared to something.
For example, businesses can compare their productivity values to that of similar firms,
other departments within the same firm, or against past productivity data for the same
firm or department (or even one machine).

12. PRODUCTIVITY INDEX
This allows firms to measure productivity improvement over time, or measure the
impact of certain decisions such as the introduction on new processes, equipment, and
worker motivation techniques.
In order to have a value for comparison purposes, organizations compute their
productivity index. A productivity index is the ratio of productivity measured in some
time period to the productivity measured in a base period.

13. For Example
If the base period's productivity is calculated to be 1.75 and the following period's productivity
is calculated to 1.93, the resulting productivity index would be 1.93/1.75 = 1.10.
This would indicate that the firm's productivity had increased 10 percent. If the following
period's productivity measurement fell to 1.66 the productivity index of 1.66/1.75 = 0.95 it
would indicate that the organization's productivity has fallen to 95 percent of the productivity
of the base period.
By tracking productivity indexes over time, managers can evaluate the success, or lack thereof,
of projects and decisions.

14. Types of
productivi
ty index
Labor
productivit
y Direct
labor Cost
Productivit
y
Capital
productivit
y
Direct cost
productivit
y
Total cost
productivit
y
Foreign
exchange
productivit
y
Energy
Productivit
y
Raw
material
productivit
y

15. Factors Affecting Productivity
Machines
Systemlabour
Delivery

16. Internal
Managers
Working hours
Satisfaction
Development and
training
External
Country rules and
regulation
Weather
Culture
Durability
Maintenance
Technology
Labour and Machine

17. Technology
Maintenance
and update
Operators
Machine user
Store system
Delivery machine
type
Store location
Maintenance
System and Delivery

18. PRODUCTIVITY IMPROVEMENT
Improving Productivity means increasing
or raising productivity with the help of
using same amount of material, machine
time, land, labour technology.

19. Labour Productivity can be
higher or lower depending
on factors like availability
of work load, material,
working tools, availability
of power, work efficiency,
level of motivation, level of
training, level of working
condition (comfortable or
poor) etc. Can be increased
by increasing efficiency of
labour.
LABOUR PRODUCTIVITY

20. MATERIAL
PRODUCTIVITY
Material productivity plays
important role in cost of production.
Material productivity depends upon
how material is effectively utilized
in its conversion into finished
product. Material productivity
depends upon percentage of
rejection, creation of scrap, level of
spoilage, obsolescence, work
wastage etc.
Material productivity can be
increased by using skilled workers,
adequate machine tools, good
design of product etc.

21. MACHINE
PRODUCTIVITY
Machine Productivity:
Production system converts
raw material into finished
product through mechanical
or chemical process with the
help of machines and
equipment's. Machine
productivity depends upon
availability of raw material,
power, skill of workers,
machine layout etc.

22. CAPITAL
PRODUCTIVITY
For any production set- up,
facilities of machines, tools,
land etc. are required which
are assets of organization.
Capital is needed for such
assets. As huge capital is
locked in assets, their
effective utilization is
absolutely necessary. Capital
productivity depends on how
effectively assets are utilized.

23. Productio
n planning
Production
control
Motivating
work force
Provision
of plant
service
Inventory
control
Quality
control
Product
department
Function Of Production Management