Productivity and efficiency

Productivity is a measure of how efficiently resources are used to produce goods and services. It is calculated as the ratio of output to inputs used. Productivity should not be confused with efficiency, which refers to getting the most out of a given set of resources. Productivity is broader and considers overall resource use. Factors that affect productivity include technical, financial, natural, managerial, social, administrative, quality of labor force, and size of industrial unit. Productivity can be improved through techniques like scientific management, work study, good employee relations, training, adapting to external environment, and continuous improvement. Measuring productivity is important for resource allocation, comparative analysis, economic forecasting, and policymaking.