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Human Resources Management - Compensation And Productivity

Productivity - Compensation And Productivity

   Posted On :  13.06.2018 10:15 pm

Productivity might be described as the rate of production per unit of input expenditure involving time and cost.


Productivity might be described as the rate of production per unit of input expenditure involving time and cost. Some describe productivity as the judicious use of productive resources-physical as well as mental. It is the numerically stated measure of how well an operations system functions and an indicator of the efficiency and competitiveness of a single firm or department. Productivity is used by people to mean different things. To the employers, productivity means lower and lower costs. To the employee it could mean harder and harder work, and therefore lesser real wages than the past years for work of equal intensity and hardship.
Productivity is considered to be a function of factors like physical factors, situational factors and individual factors. An employee’s productivity is determined by that person’s motivation and ability to perform a task. In case of teamwork, a group’s size, compositions, norms, interpersonal understanding, cohesion and its leadership would determine the group’s productivity. In the same way, an organization’s productivity would depend on its culture, climate, leadership, vision and missions, learning and entrepreneurship. The exponents of productivity regard labour productivity as one of the basic rods of measurement of economic development and as one of the key determinants of national income.

Tom Peters and Waterman, the specialists on organizational excellence, have paid due emphasis on productivity improvements that are achieved through people. According to them, progressive organizations would treat the ordinary members of the organization as the basic source of productivity and quality gains. These organizations do not regard capital investment and labor substitution as the fundamental source of productivity enhancement. Their people orientation is marked by performance consciousness, but the personal achievements stem mainly from developing mutually high expectations and peer review rather than exhortation and complicated command and control systems. They work very hard to cut the need for intrusive forms of corporate management, believing that the less of direct intervention from higher management the better it is for the productivity of the organization.

Peter Drucker (2002), the renowned Management Guru identified different types of productivity such as plant productivity, material productivity, financial and capital productivity, machine productivity and human productivity. Human productivity is further classified as managerial and labour productivity. He has emphasized productivity through the following statement “A productivity measurement is the only yardstick that can actually gauge the competence of management and allow comparison between managements of different units within the enterprise, and of different enterprises”.

Poor productivity is the result of several factors like lack of adequate planning, failure to be proactive in preparing for alternatives, incompetence, insufficient training, weak discipline, low standards and disharmonious relationship between the employer and employees. Other phenomena that could result in productivity problems include de-motivation, lack of commitment towards job and organization, tolerance towards wasteful practices, bloated human power, nepotism, impeding bureaucracy, dysfunctional competition, conflicts and alienation among employees. Inadequate office support, lack of proper equipments, shortages of supplies, excessive reporting requirements and unpredictable workloads are also common situational constraints.

Productivity could also be affected by certain restrictive practices which might be in the form of outmoded, irrational or unreasonable rules or customs which unduly hinder the efficient use of labor. At times, work groups might seek to maintain traditional rights and prerogatives in the context of changed circumstances and technological advance. Some times, wage-productivity linkage might have to be examined for commensurability. Hence it might not be worthwhile for any manager to aim straightaway at productivity improvement without addressing these underlying impeding factors.

Productivity in certain cases might also be impaired due to human causes. This might include pressures from co-workers to limit one’s performance in order to check work targets from shooting up or prevent downsizing. Inadequate performance by co-workers could also affect a person’s productivity if the latter is an internal customer of the former. There could be situational constraints due to colleagues in the form of turnover of key personnel and absenteeism. Elton Mayo, the father of Human Relations ‘School of management thought’ concluded that behavior and sentiments were closely related. He established that group influences significantly affected individual behavior, that groups’ standards established individual worker’s output and that money was less a factor in determining output and productivity than aspects like group standards, group sentiments and groups’ security.

The problem of increasing productivity implies the complete, appropriate and efficient utilization of available resources of human beings, machines, money, power, land, time and other wherewithal.
Productivity as a concept connotes a mass attack on waste of every type of resources and in all fields of production. It implies development of a constant urge to find improved, cheaper, quicker, easier and safer ways of doing a job, manufacturing a product or providing a service.
Tags : Human Resources Management - Compensation And Productivity
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