We explain what productivity is, how it is classified and the methods to measure it. In addition, its characteristics, advantages and social impact.

What is Productivity?

Productivity is the relationship between the number of products used for a given task or function and the resources needed to achieve results.

Productivity  has an almost constant and direct relationship with quality , since it tries to constantly promote improvements to reduce costs and increase the profitability of the organization . However, this is not the only variable to consider.

To improve productivity, emphasis can be placed on the following variables:

  • Product
  • Technology
  • Organization
  • Human Resources
  • Labor Relations
  • working conditions
  • Quality

See also: Benchmarking .

Productivity Types

Labor productivity establishes a parameter of hours worked.

There are three different types of productivity.

  • Labor productivity. Also called productivity per hour worked. It is one that is established in a parameter of certain hours (for example "X" amount of productivity per hour worked).
  • Overall productivity. Take into account all the factors involved in production.
  • marginal productivity. It is the product obtained by making a change in one of the variables or factors that are taken into account for productivity. For example, when the number of personnel or the number of machinery necessary for a certain task is increased and thus the processing time is reduced.

Importance of productivity

It is considered that the only way for a company or organization to increase its profitability is by raising its productivity. For this , methods are used and work times are optimized .



Its function is to establish a measurement or relationship between the proposed results and the actual or achieved results . It allows these results to be quantified, which are mostly measurable in a certain period of time (quarter, four months or annually).


It takes into account the impact that customers or consumers receive from the product, as well as evaluating possible imbalances that should be made to the product or its distribution channel.

Productivity Measurement

As mentioned above, productivity is measured by the relationship between inputs (resources) and outputs . A higher productivity with the use of the same amount of resources implies a higher profit or profitability for the company.

Factors Affecting Productivity

Factors Affecting Productivity

These factors can be:

  • External factors. It refers to certain government regulations, demand or competition. They are factors that are outside the company.
  • Internal factors. It can be the product itself, the process or the agents involved in production.

Productivity improvements

Improvements in production can be made taking into account any of the following variables: Technology, organization, human resources, labor relations, working conditions .

It is important to bear in mind that productivity improves or increases as long as some of these variables are adjusted, but without decreasing (and preferably increasing) outputs or sales of the product.

Strategies to raise productivity

Strategies to raise productivity

  • Recognize that the people who make up a company or organization are different and be able to regulate or adapt these differences or at least minimize them so that the proposed objectives are met . For this it is also convenient to have a good selection of personnel.
  • Propose specific and real objectives for each employee .
  • Stimulate through gifts that are of interest to employees.
  • Make it clear that the system is fair and that any employee can achieve the goals proposed by the organization.

Advantages in productivity improvements

  • Reduce the weaknesses and increase the strengths of the company.
  • The results are tangible and in the short or medium term.
  • Positions the company at an advantage over its competition.
  • Eliminate repetitive or obsolete processes.

Social impact of productivity

Social impact of productivity
Often, and with the aim of minimizing some of the variables mentioned above, companies use resources that affect the environment or reduce costs (work force) that have repercussions in raising unemployment rates.

The social impact is something that every company must take into account when measuring its productivity since, given that the company is inserted in a certain society , it cannot harm the environment or eliminate all jobs. In this case, it should be done in stages to assess the social response.

The above content published at Collaborative Research Group is for informational and educational purposes only and has been developed by referring reliable sources and recommendations from technology experts. We do not have any contact with official entities nor do we intend to replace the information that they emit.


MA student of the TransAtlantic Masters program at UNC-Chapel Hill. Political Science with a focus on European Studies. Expressed ideas are open to revision. He not only covers Technical articles but also has skills in the fields of SEO, graphics, web development and coding. .

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