By

Dr. Ali Sajid

Great Opportunities to
help others seldom
come, but small ones
surrounds us every day.
 One Person
With a belief is
Equal to a force of 99
Who have only interest.
The greatest good
you can do
for others is not to
share your own
riches, but to reveal
theirs.
Minds are like
Parachutes
They work only
when they are
Open.
 Emerged strongly in new Era of
Globalization.
 Describes “Economic Strength” of Any
“Organization” or Position of Certain
company” with respect to its competitors
in market place.
Competitiveness is process
by which
one entity
strives to
outperform
another.
 Ability to get
customers to choose
your prod or svc
over competing
alternatives on
sustainable basis.
•Continually “Sustained incorporated in
productivity”.
•Resulting in high wages & living

standards.
•Competitiveness is demonstrated by:

– “Ability to Meet, Rest of Free

International markets” While
“Expanding Real Income."
Macro Level competitiveness of
nations reflects standard of living
of their citizens.
National competitiveness
consolidation of micro-level
performances of company’s &
individuals – true “Agents of
Economic Growth”.
 High
standard of
living

Trade

Productivity
(Quality should exist)

Investment in productive
facilities
(Factors, R&D, technology)

Competitiveness Pyramid
•"Standard of living is determined By
Productivity of a Nation's Economy.
Productivity: Efficiency with which goods &
services are produced & provided.
Determined by:
a) Previous investments.

b) Quality & Performance of Workforce.

c) Technology Innovation.

d) Quality of Plant & Equipment.

e) Efficiency with which these factors of

production utilized.
 Productivity of
“local” industries
is of
fundamental
importance to
competitiveness.
Depends on:

1. Sophistication with “Which

companies Compete”.
2. Quality of “Microeconomic
Business Environment".
•Successful Project Management
Organization Create surplus through
Productive operations.
•Productivity is output input agreement

on Consideration of “Quality & Time”.

Productivity = Outputs (Time /Quality)

Inputs
Ratioof output to input by large
number of professionals.
ILO Definition: “Ratio between

“output of Wealth Produced”

& “input Resources used up” in
“Process of Production”.
Comparative tool for managers,
industrial engineers, economists,
politicians.
 Feedback

Inputs Outputs
Raw materials, Product/ Transformation Control Products,
human resources, Service Process Processes services, &
capital (land, Design &
Facilities other (pollution)
buildings,
equipment),
technology
information.
Productivity Perceived as
Indicator of
“How well”
Goals or
Performance objective
or Mission achieved.”
Comparison between
“Quality of goods/services
produced” & “Quality of
Resources Employed” in
Turning out these
goods/services.
•Production: Concerned with
Activity of “Producing Goods &
or services”.
•Productivity: “Efficient

Utilization of Resources”
(input) in “Producing
Goods/services” (output).
 Production is Quantity of
Output produced.
 Productivity “Ratio of output
produced in input (s) used”.
 Higher productivity means
Accomplishing more
with same
“Amount of Resources” or
Achieving higher output
In terms of Volume/
Quality for same input.
 Tool in hands of management
For corrective steps for
“Performance improvement”.
 To provide a “Ready Reference”.
 “Comparison of Perform” with
Objective of Organization.
 Various pay plans based on “output”
for “surplus” Increase labor
productivity not possible work order:
 Providedample reward
 Adequate Targets
 Managerial Help
Use “Accounting Ratios”
for management-usually
interested in productivity
measures that enable it to
easily assess the present
profitability of company.
 Seek measures of “Physical Assets”
& other resources: e.g.
 “Production/hour
 Man hours/unit
 Material required/unit
material/consumption, utilization
 Space Utilization”
 View productivity of “People in
Organization” in Terms of “Time they
spend at work”
Vs.
“Total time available”
 “Costing & Budgeting” approach to
productivity.
 “Budget Figure, rather than
Optimum achievable values”,
used as standards can be a “False
impression” of “High Productivity”.
 Partial measures, such as
“Labor Productivity”.
 Employed by “Economists”.

 Total Factor & Total productivity

but again definitions do not agree.

•Productivity implies Effectiveness &
Efficiency both individual &
“Organization Performance”.
•Effectiveness is “Achievement of
Objective”.
•“Efficiency is Achievement of Ends”

with “Least Amount of Resources”.

 Partial Productivity.
 Total Factor Productivity.
 Total Productivity.
Total-Factor Productivity - Ratio
of “Net output to sum of associated
Labor & Capital” (factor) inputs.
Net output- total output minus
intermediate goods & services
purchased.
• Average, only 4.4 hours/day Used
productively.
• 1.2 hours lost due to personal &
other Unavoidable delays.
• 2.4 hrs are simply wasted because of
management’s inability to
Effectively “Plan & Control” the
worker’s tasks.
-35 Percent due to Poor “Planning &
Scheduling” of work.
-25 Percent due to “Unclear & Untimely
Instructions”.
-15 Percent due to “Inability to adjust staff
size” & Duties during “Peak & Valley
Workload Periods”.
-25 Percent due to “Poor Co-ordination” of
“Material Flow”, “Unavailability of Needed
Tools”, “Excess Travel Time”.
 Productivity of
“White-Collar Workers” is no
Less important
than that
of “Direct Labor” or
“Manufacturing Employees”.
It is “usually least
known, least
analyzed, least
managed of all
factors of
Productivity”.
 Peter Drucker
White Collar Employees
Productive only – “50% of Time”.
Remainder is Non-Productive
time &
can be traced to “Personal Delays
(15%)
& “Improper management (35%).
 Examples of White Collar Waste
1.Poor staffing
2. Inadequate communication
3.Unproductive meeting & telephone
conversations
4. Poor scheduling
5. Slack start & quiet times
6. Lack of communication between function
7. Information overload
 Family-controlled industry-Earning
easy money.
 Monopolistic market, in some
segments, some high competitive
Erratic Inflow of Orders.
 Lack of Productivity & Quality
culture.
 Shortage of Funds Low level
Codification.
 Automation -not encouraged.
 Low priority of market & commercial
activities.
 Poor after service.
 Complicated government policy, rules &
regulations.
 Poor Infrastructure support/Road
Transport.
 Energy shortage.
 Poor working conditions, light, ventilation,
safety, housekeeping).
 Non availability of basic material
components (to be imported)
 Unreliable suppliers.
 Inability to measure, evaluate, & manage
productivity of white collar employees.
This causes shocking waste of resources.
 Rewards & benefits given without
requiring equivalent in productivity &
accountability.
 Diffused authority & inefficiency in
complex Organization, thereby, causing
delays & time lags.
-Organization expansion - lowers
productivity growth which
results in soaring costs.
-Low motivation - among rising
number of affluent workers with
new attitudes.
Late Deliveries - caused by
Schedule have been disrupted by
limited materials.
-Unresolved human conflicts Difficulties
in teamwork, resulting in Project
inefficiencies.
-Include legislative intrusions.
-Antiquated laws, Resulting in
constrained “Management options &
prerogatives”.
-Specialization in work processes
resulting in “Monotony & Boredom”.
-Rapid “Technology Changes & High
Costs”, Resulting in “Decline in new
Opportunities & innovation”.
-Include demand of “Leisure Time”
causing “Disruption in Operations”.
-Project Manager inability to keep pace
with: Latest “Information &
Knowledge.
Productivity compose of:
People
Operations variables”
To improve productivity
management needs to focus
on both.
 Productivity does not just happen
by “trying harder”. It must be
planned.

 But how do you plan for

productivity, & what factors are
involved?

Frank. E. Cotton, Jr.

Improvement means “Increase
in ratio of “output of goods &
service Produced divided by
“input used to Produced”.
Ratio can be included by Either
“increase output” “Reducing
input” or Both.
Financial & Social Benefits of
“Productivity Improvement
strategy” in Project Manager
Should be Greater than
“Implementation Cost”,
in long run.
 Productivity Improvement
focused on “Technical &
Capital Equipment” to reduce
input of labor cost.
 Improved output Require IE
Technique: e.g.
a)Methods Analysis
b)Work flow etc.
Productivity improvement (PI)
is not just
“Doing things better”
more importantly,
Doing right things Better.
Inter-relationships between
Labor, Capital & Socio-
Organizational Environment –
Important
in way they are
“Balanced & Co-ordinate”
into integrated whole.
 Job-related
 Resource-related

 Environment-related

Two major Category of Productivity

factors is:
 External (not controllable).

 Internal (controllable).
External-Beyond Control of
Individual Enterprise.
Internal –with in its control

First step towards “Productivity

Improvement” is to Identify
problem areas with in these factor
groups.
 Enterprise
Productivity
Factors

Internal factors External Factors

Soft Natural Natural Govt &

Hard
factors adjustments resources infrastructure
Factors

Institutional
Product People Economic Manpower Mechanisms

Policies &
Plan & Organization & Sys Demographic Land Strategy
eqpt & Social

Tech Work Methods Energy Infrastructure

Public
Materials & Mgmt Styles Raw material
enterprises
energy
People: Principal resource is a Central factor
in “Productivity Improvement drives”.
People in Organization all have role to play

as Workers, engineers, Managers,

Entrepreneurs, Trade union members.
Each role has two aspects:

1. Application
2. Effectiveness
 Motivation is basic to All
human behavior & to Efforts in
“Productivity Improvement”.
 Material needs – Predominant,
but does not mean that “Non-
financial incentives” Not
Effective or have No Place.
 Law of behavior
 Motivation decreases if it is either
satisfied or blocked from satisfaction.
 Workers may do their jobs work order
working hard (no motivation), But
even if they work to their full capacity
they would not be satisfied
(motivation is blocked from
satisfaction).
Workers’ success in increasing
Productivity by:
Rewards

Improving recognition

Involvement

Learning Opportunities

Elimination of negative rewards

 Individual plan is made to give financial
incentives on basis of individual
performance.

 Types:
 Piece work plan.
 Standard hour plan.
 Measured day work plan.
 Emerson plan.
 Fringe benefits
 employee promotion
 job enrichment
 job enlargement
 job rotation
 workers participation & empowerment
 “Motivators” factors leading to job
satisfaction Achievement
recognition, nature of work
responsibility, growth etc.
 Factors leading to dissatisfaction
avoidance are “hygiene”;
Company policy, administration,
supervision, pay status.