A High Productivity Ratio - Essay Example

While it is important to increase productivity, companies must strive to ensure that the desired productivity is attained with the same resources. (4).While it is true that multifactor productivity pinpoints the efficiency of a company, I believe that there are more items to consider when assessing the efficiency rather than merely focusing on the production process. Maybe we should consider sales turnover as well as how the company meets its plans. However, we cannot claim with certainty that reducing inputs increases productivity as this is not always the case.

The volume of production should most appropriately be increased through motivating employees and providing an appropriate amount of materials. Non-financial rewards will work best as they do not upsurge the labor cost. (5).I believe that productivity can best be explained as the efficiency of production and not as “represent the economic value of the factors of production” as you put it. However, it is true that when determining productivity, one must determine the market value of the inputs and outputs.

The suggestion that productivity is improved through scientific methods is quite reasonable. Technology and investment in skilled labor coupled with the motivation of employees, I believe, are best suited to improve the productivity of firms in a country. Moreover, it will improve the productivity of the country resulting in growth and development where the welfare of citizens will dexterously improve.