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What factors might cause costs for an organization to misalign with productivity?
Wiki User
∙ 11y ago
Productivity is usually calculated as the amount of output per employee.
Costs for an organization include both personnel costs and non-personnel costs.
Increasing productivity would seem to align with lowering costs. But this is not always the case. For example, by automating functions a company can increase productivity but due to the cost of the automation, total costs may go up instead of down. As another example, running an assembly line faster may seem to increase productivity, however increased errors in the products may impose costs in excess of the productivity savings.
Wiki User
∙ 11y ago
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FACTORS AFFECTING PRODUCTIVITY 1. Capital/labour ratio: It is a measure of whether enough investment is being made in plant, machinery, and tools to make effective use of labour hours. 2. Scarcity of some resources: Resources such as energy, water and number of metals will create productivity problems. 3. Work-force changes: Change in work-force affect productivity to a larger extent, because of the labour turnover. 4. Innovations and technology: This is the major cause of increasing productivity. 5. Regulatory effects: These impose substantial constraints on some firms, which lead to change in productivity. 6. Bargaining power: Bargaining power of organized labour to command wage increases excess of output increases has had a detrimental effect on productivity. 7. Managerial factors: Managerial factors are the ways an organization benefits from the unique planning and managerial skills of its manager. 8. Quality of work life: It is a term that describes the organizational culture, and the extent to which it motivates and satisfies employees.
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