productivity Flashcards
1
Q
what is Productivity
A
- Productivity is a measurement of the efficiency with which a business turns production inputs into output.
- Labour productivity (output per worker) is the most common measure of productivity.
2
Q
Ways of measuring Productivity
A
- output per worker
- output based on capital employed
3
Q
How can Productivity be increased
A
- Technology
- Lean Production
- Training
- Workplace reorganisation
4
Q
Importance and impact of Productivity for a business
A
- increased competitiveness
- lower unit cost
- motivation due to performance bonuses
5
Q
Capacity Utilisation
A
Capacity utilisation is a measure of the extent to which the productive capacity of a business is being used
6
Q
what is the calculation for capacity utilisation?
A
(current output / maximum output) x 100
7
Q
Evaluate the concept of capacity utilisation for a business and its stakeholders
A
Positive:
- Higher Revenues and Profitability
- Better resources Efficiency
- Competitive Advantages
Negative:
- Overutilisation risk
- Underutilisation risk
8
Q
how do you calculate labour and capital productivity?
A
- Labour productivity = Output (per period) / Number of employees (per period)
- Capital productivity = Output / Capital employed
