Data brings outside inside
Way forward with Productivity Measurement
Understanding and studying the variations in data and its usage enhances productivity. It's the very basis for productivity measurements. Productivity measurement is the ratio of organisational outputs to organizational inputs, it could be total or partial. The complexity at times may arise from the relationship between input and output being obscure, it may be difficult to measure outputs and/or inputs, product mixes may vary considerably, affecting the changes in a fashion difficult to understand, input and/or output quality may vary and data may be hard to obtain. Irrespective of your industry the above complexity will be encountered which may impede productivity measurement in real time.
"Know that the indices greater than 1 (one) show productivity improvement, while indices less than 1 (0ne) show productivity deterioration”
The productivity indices of your consideration could be total or partial measures also they could be static or dynamic. You can't escape the next part since I am an industrial and systems engineer, I'll shade light in that direction, so static measures are a ratio taken as a snapshot with no base year comparison, that is to say, you are not looking at the productivity in respect of a particular year's performance as a yardstick. Dynamic measures are the ratios of the static productivity indices, which implies the ratio of the outputs this year and inputs that year over the ratio of the outputs base year and inputs base year. Know that the indices greater than 1 (one) show productivity improvement, while indices less than 1 (0ne) show productivity deterioration. As with static measures, dynamic measures can be partial or total.
Productivity measurement can be approached in two major ways that is, the first being the group-generated model which is called the normative productivity measurement methodology, and the second which is less participative in the sense that one model can be modified to fit any organizational scheme or format which is called the multifactor productivity measurement model.
The normative productivity measurement model relies on experienced managers to develop the productivity measurement ratios or indices applicable to a specific government, organization, or company. For instance, a political party or government whose performance indices are less than 1 (one) can seek the services of veteran elites irrespective of their affiliation to help create this model to boost performance. This approach is done through a structured group process known as the nominal group technique. Although not a total solution this approach can usually lead to a group consensus on what is important to monitor. The process which must be carefully adhered to by a team lead is as follows: first, silent generation, where each person is asked to generate a list of measures. Second, is the round robin where after 5 to 15 minutes, the group members are asked to present their ideas. Third is the group clarification, where all ideas are clarified, the overlaps or duplicate ideas are identified and remedied, and finally, voting will lead to a consensus, this step is similar to what is done using the prioritization matrix.
"Under price recovery, prices can be raised or lowered as the market allows or demands. Both can drastically affect productivity. You will notice especially now that price increases can usually be tolerated only as long as competition and consumer reaction eventually occur"
The second major way to approach productivity measurement is the multifactor productivity measurement model which is more comprehensive and analytical in consideration to measuring changes in productivity. This approach recognizes that there are two ways profitability can be affected in any organization, government and company. There are price recovery and productivity changes.
Under price recovery, prices can be raised or lowered as the market allows or demands. Both can drastically affect productivity. You will notice especially now that price increases can usually be tolerated only as long as competition and consumer reaction eventually occur. The desired change is through productivity improvement (s).
This approach uses accounting techniques to break the total variation(change in profit) into price effects and productivity effects, resulting in a valid productivity model. Let's end this approach by saying that it could be done on both inputs and outputs for instance profitability is affected by sales price and quantity changes in labour, energy, materials and any inputs at all.
"Also with the present realities seeking for better ways or the alternative medium on how things should be done and the way forward begins with taking responsibility for our productivity performance, it is at this point that data brings outside inside"
With the way the government is singing productivity and seeking accountability, the least is for you to have a clear understanding of productivity measurement and how to know when there is an improvement or deterioration, it will help you harness your decision and focus on the right stuff. Also with the present realities seeking for better ways or alternative medium on how things should be done and the way forward begins with taking responsibility for our productivity performance, it is at this point that data brings outside inside.