This document discusses the relationship between productivity and business competitiveness. It defines productivity as a measure of efficiency or the amount of output produced compared to the amount of input required. The document explains that productivity can be improved by either producing more outputs from the same inputs through better use of resources, or by reducing inputs needed for the same level of outputs through waste elimination or technology upgrades. It also notes that improvements can be made in facilities, materials management, quality control, and technology. Competitiveness refers to being as good or better than rivals based on factors like cost, quality, and delivery speed.

1. Productivity and Business competitiveness

2. Outcomes (What you need to know and be able to do)
• What is the link between productivity and an
organisation’s
operations?
• Explain the relationship between productivity and business
competitiveness.
• Explain three ways in which a manufacturing organisation
could improve productivity.
• Explain three ways in which a service organisation could
improve productivity.

3. Productivity is a measure of efficiency
Efficiency is the amount of output produced compared to
the amount of input required in production

4. Productivity can be improved
by producing more outputs
from the same inputs
Productivity can be improve by
reducing the level of inputs for
the same outputs

5. Now it is your turn...... using an example of your own
explain how........
Productivity can
be improved by
producing more
outputs from the
same inputs
Productivity can be improve by
reducing the level of inputs for
the same outputs

6. Productivity improvements can be made in any area of
the operations system.They can be achieved in human
and non-human aspects of the system.
During the remainder area of this area of study we will
examine four areas of operations in which managers
use strategies to increase productivity:
■ facilities design and layout
■ materials management
■ the management of quality
■ new technology

7. Being competitive refers to a product or service being as
good as or better than others of a comparable nature:
a car industry competitive with any in the world.
!
For example (of prices) low enough to compare well
with those of rival traders: we offer prompt service at
competitive rates.

8. Areas of operational competitiveness
Competing on cost
Competing on quality
Competing on speed of delivery

9. Exit Question
Define the term productivity
Suggested solution
Definition of productivity should refer to its being:
• the relationship between inputs and outputs.
• a measure of how efficient the organisation is in turning inputs such as raw
materials, employee activity, technology etc. into the final product or service
the organisation offers for sale.
Award 1 mark for full definition.
VCAA Assessment Report note:
A good student response:
Productivity is the level of output per unit. It is a direct measure of efficiency.
High productivity levels mean that the organisation is getting larger levels of
output per level of input.