A presentation during a training in Malaysia.

1. 1
BUSINESS ORGANIZATION
&
PRODUCTIVITY

2. Objectives
Participants will be able to explain the
various concepts of productivity from
purely economic to the philosophical, and
how these various conception affect
approaches and management of the
business organization to achieve higher
levels of productivity, quality and
c o m p e t i t i v e n e s s .

3. 3
Outline
 Explain the Concepts in Productivity
 Why productivity is important ?
 Barriers to Productivity
 Stakeholder ship
 Discuss the Productivity Management
Framework
 Relate Productivity & competitiveness
 Making productivity as a strategic objective
of the organization

4. 4
DOING BETTER TODAY THAN
YESTERDAY
and
DOING BETTER TOMORROW
THAN TODAY
Meaning of Productivity

5. 5
Individual Perspective
PRODUCTIVITY is a combination of EFFICIENCY and EFFECTIVENESS
DOING THINGS
RIGHT
DOING THE
RIGHT THING
PRODUCTIVITY
IS THE
ATTITUDE
OF THE
MIND
THINK
FEEL
DO
To
Management Perspective
Seek to continually
improve
what already
exists.

6. 6
PRODUCTIVITY = OUTPUT
INPUT
Value
Creation
Cost
Reduction
Technically, Productivity is a ratio of output produced (which
contributes to the accomplishment of the mission), per unit of
resource utilized (input) compared to a similar ratio from a
base period with the same or increased quality.
INPUT
Manpower People (employees)
Machines Place (environment)
Material Provisions (supplies)
Methodology Procedures
Measurements Public (customers)

7. 7
Meaning of Productivity
As an economic concept
 Creation of more value for the customer
 Customer and people satisfaction

8. 8
Meaning of Productivity
As an integrated concept
Output x satisfaction
PRODUCTIVITY =
Input x sacrifices
As an objective - Social concept
As a means - Technical concept

9. 9
Why productivity is important ?
 For world competitiveness
 For better quality of life of all citizens
PRODUCTIVITY CHAIN
HIGH
PRODUCTIVITY
LOW
PRODUCTIVITY
EFFICIENT,
EFFECTIVE,
ECONOMICAL
USE OF
RESOURCES
INFERIORITY
IN MARKET
COMPETITION
ECONOMIC
SLOWDOWN
SOCIAL
INSTABILITY
SUPERIORITY
IN MARKET
COMPETITION
ECONOMIC
DEVELOPMENT
AND GROWTH
BETTER
STANDARD
OF LIVING AND
HUMAN
WELFARE
WASTEFUL
USE OF
RESOURCES

10. 10
Competitiveness
 The ability to produce goods &
services that can meet the tests of
domestic and international markets
while promoting & maintaining a high
standard and quality of living of people

11. 11
PRODUCTIVITY DRIVES NATIONAL DEVELOPMENT
INDIVIDUALS
BETTER QUALITY OF LIFE
INDUSTRIES
PRODUCTIVITY
ECONOMIC SECTORS
GDP OF NATION

12. 12
Benefits to the country:
Business prosper, High rise development,
Increase export, Increase investment,
Less reliance on others
Increase global competitiveness
PRODUCTIVITY LEADS TO BETTER QUALITY OF LIFE
FOR KENYANS

13. 13
PRODUCTIVITY LEADS TO BETTER QUALITY OF LIFE
Benefits to the Workers
•Stronger bargaining power
•Better Employment
•Higher Wages
•Higher Standard of Living
•Progressive Society

14. 14
MISCONCEPTIONS ABOUT PRODUCTIVITY
Some of the common misconceptions which need to be removed by all means
are:
 Productivity is often equated with production
 Productivity applies to blue color workers only
 Productivity improvement takes away jobs
 Productivity improvement only benefits employers
 Productivity improvement just means working harder, and “I am already
working hard enough”
 Productivity improvement is all right for factory jobs, but does not work for
white color workers
 Productivity improvement increases stress and reduces job satisfaction

15. 15
New competition in a rapidly globalizing
economy
 Better informed and more discerning
customers
 Increasing number of competitors
 Rapid advance in both soft and hard
technology
 Advance in new scientific fields
 Increasing concern for sustainable
development

16. 16
Enterprise Level Competitiveness –
Tools/Determinants
 Price
 Quality
 Product differentiation
 Technical innovation
 Service
 Customer orientation
 Speed
 Flexibility

17. 17
Barriers in Productivity
A. External Factors
These are factors that affect an enterprise’s
productivity but which it cannot control (at least in the
short term) and include;
• Human resources (availability, skills and attitudes
Natural resources land, water, raw materials, energy)
Infrastructure (physical, business climate - social and
economic, employers’ and workers’ organizations
• Government policies and programmes;
• Cultural and social values and norms, Markets and
customers; and International economic, social and political
environment.

18. 18
B. Internal Factors
Internal factors are those factors over which the individual enterprise
wields control. Therefore, while being aware of the influence of the
external factors, the individual enterprise must focus attention on the
internal factors to effect immediate positive changes in productivity.
These factors include, but are not limited to the following:
- Organization structure and management style;
- Business premises;
- The workforce;
- Work organization and methods;
- Management - labour relation;
- Product design, marketing and sales

19. 19
AN INTERGREATED MODEL OF ENTERPRISE
PRODUCTIVITY FACTORS
ENTERPRISE
PRODUCTIVITY
FACTORS
INTERNAL
FACTORS
EXTERNAL
FACTORS
HARD FACTORS SOFT FACTORS
PRODUCTS
PLANT AND
EQUIPMENT
TECHNOLOGY
MATERIALS &
ENERGY
PEOPLE
ORGANIZATOIN &
SYSTEMS
WORK METHODS
MANAGEMENT
STYLES
STRUCTRAL
ADJUSTMENT
NATURAL
RESURCES
GOVERNMENT
INFRASTRCTURE
INSTITUTIONAL
MECHANISM
POLICIES AND
STRATEGIES
INFRASTRUCTURE
PUBLIC
ENTERPRISES
MANPOWER
LAND
ENERGY
RAW MATERIALS
ECONOMIC
SECTORAL
DEMOGRAPHIC &
SOCIAL

20. 20
Meaning of Quality
 The totality of features and characteristics of
product or service that bear on its ability to satisfy
stated or implied needs of customers
Quality Management
 All activities of the overall management
function tha5t determine quality policy
objectives, implement them by means such
quality planning, quality control, quality
assurance, and quality improvement within
the system.

21. 21
The Power of Quality
 Less wastes
 Lower costs
 Lower inventories
 Motivated
employees
 Faster deliveries
 Delighted
customers
 Higher sales

22. 22
Typical Quality Related Problems
 Inconsistent policies
 Frequent change in leadership
 Overlapping of functions
 Too much paper work
 Unclear / circuitous procedures
 Long queues
 Customer has to pay extra

23. 23
Quality Management Principles
 Customer- driven
organization
 Leadership
 Involvement of
people
 Process approach
 Systems Approach
to Management
 Continual
Improvement
 Factual Approach
to decision Making
 Mutually Beneficial
Supplier
Relationships

24. 24
Productivity and Cost of quality
 The higher the cost of poor quality,
the lower the productivity

25. 25
Stakeholdership Principle
Stakeholder Role Expectation
Customer Specify the needs ; the
basis for our existence
Customer delight
Worker Contribute Productive
labour
Fair reward & sense of
belonging
Government To provide a conducive
environment
Tax, employment and
better standards of living
for Kenyans
Stockholder Provide factors of
production & vision and
direction
Return on Investment
Future security
Management Facilitate the effective
interaction of all the
stakeholders
Best result
Benchmark
Performance

26. 26
PRODUCTIVITY MANAGEMENT FRAMWEWORK
Ultimate
Goal
Intermediate
Goal
Approach
Strategy
Method
Ground
Better Tomorrow for Everyone
Effective use of Resources
Efficiency improvement
Economic Operation
J
I
T
T
P
M
T
Q
M
G
P
SS 5S QC

27. Elements of Success
 Top management Commitment and
leadership
 Middle management Support and
Involvement
 Workers’ participation
 Continuous Education and Promotion
 Measurement of Success
 Suppliers, Distributors and Sellers’ Support

28. Therefore
Productivity is a powerful means for---
-- change,
a dynamic,
decisive movement
to new,
higher levels of
performance and
competitiveness

29. 29
THANK YOU