1 Productivity is a Measure of Performance Individual -- Group -- Organization -- Nation Productivity = Output Inp ut

2 Profitability Effectiveness Efficiency Cycle time Quality Quality of Work life Innovation Utilization Productivity Sink et al. (1984)

3 Objectives -- Goals Method -- Path Achievement Are we really up here? As a manager, what needs to know ?

4 Historical comparison Compared with a base year (Index) Compared with competitors Compared with some certain standards Benchmarking

5 Perspectives of productivity NarrowPerspective B r o a dPerspective Process Input ??

6  Partial Productivity  Multi Factor Productivity  Normative Performance  Multi Criteria Performance

7 Productivity = Output Inp ut Labor Productivity Capital Productivity PROs CONs VS “Capital-labor substitution”

8 Consider all output & input at the same time and Convert things to price-based unit Two models Total Productivity Total Factor Productivity

9 Define & Calculate Inputs Define & Calculate Outputs Develop data collection system Total tangible inputs Total Productivity = Total tangible outputs

10 Outputs = Finished goods + WIP + All incomes (such as interests, dividends, rents, etc.) Inputs = Capitals (fixed & working) + Materials + Energy + Human + Other expenses Total tangible inputs Total Productivity = Total tangible outputs PROs CONs VS

11 Work Sheet for Output / Input Collections

12 Output is total gain from operation Value Added = Net sales - Cost of good sold - Outsource services Value Added = Net profit + Salary + Retained earning + Interest + Tax + Rent + Depreciation PROs CONs VS Total Factor Input Total Factor Productivity = Total Value Added

13 Quality Cost Delivery for customers Ethics Environmentfor everyone Safety Moralefor employee สถาบันเพิ่มผลผลิตแห่งชาติ : QCDSMEE

14 Structured group process Delphi Technique Broad view PROs CONs VS

15 PRO s CONs VS Aggregate various measures created by Normative approach in an integrated fashion Develop a new scale (Index) For example: Objectives Matrix, Balanced Scorecard

16 Construction Steps Determine all possible measures Rate the importance of measures Develop overall Performance Index Output is a Family of Measures (a weighted index of performance)

17 Objectives Matrix by Carl G. Thor

18 Accountant Cook Student Lecturer Delivery Boy Home Service

19 Dimensions for classification TD1: Unit of Analysis TD2: Time Frame for Measurement Select the right model

20 WM Ind. Firm Plant Dept Group Indv’l MinHrs Days WkMthQtr Year MF MF MF MC MC MA