Types of Productivity with Example |Productivity Formula |Calculation
Types of Productivity with Example |Productivity Formula |Calculation
Hi readers! Today we will discuss on types of productivity with example. Productivity is an economic measure of the effective use of resources. It means how much output is obtained w.r.t effective usages of input in a given time period.
PRODUCTIVITY: It is a ratio of output to input.
Productivity = Output / Input.
P = Value of output / Cost of Input
The units of output and input may vary from industry to industry. But some common units of outputs are KWH, Units, Tonnes, MT, litres, KG, and similarly, an input could be time, cost, etc. Inputs are resources such as labour, energy, materials etc. used to produce the output such as goods or services. And also, the output may be measured per shift, per week, per month or per hour.
Types of Productivity with Example:
Productivity is generally classified into three types as [1] Partial Productivity, [2] Multifactor Productivity, [3] Total Productivity.
Partial Productivity = Output / Single Input.
For example, a company produced 2000 pieces of finished product per day involving 2 labours per shift. Here we would like to calculate the labour productivity.
Labour productivity = 2000 / (6*8)
= 2000 / 48
= 41.66 pieces per hour.
Other common terms used to calculate the partial productivity industry are Machine productivity, capital productivity, Material Productivity, etc.
Multifactor Productivity = Output / more than one Input.
For example, a company produces 2000 pieces of finished product per day with input like labour cost $200, Machine cost $300, and material cost of $500. What is the multifactor productivity?
Multifactor Productivity = 2000 pieces / ($200+$300+$500)
= 2000 pieces/ $1000
= 2 Pieces per dollar.
Total Productivity = Output / All Input.
For calculating the total productivity you have to consider the values of output in rupees and cost of all inputs in rupees.
Note that productivity is generally calculated to know the performance, effectiveness, and etc. but the challenging thing is how to improve productivity. For doing so either you have to increase the output or decrease the input.
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