In business, productivity is frequently referred to as the amount of output per unit of input. When one does something as efficiently and effectively as possible, he is being productive. It can also help firms to follow their mission, vision, policies, objectives and targets. Likewise, it enables them to identify their weakness and strengths along with the opportunities and threats evolving from the market, which is another reason as to why productivity is pivotal.
Companies asses their weak spot and try to compensate and produce what things they expect, which helps them to control the output driving various departments. Even though, over productivity sometimes leads to fail in company growth, some researchers believe that the profit report of the company is not enough, and it is only the last result, while productivity that determines the efficiency/effectiveness of processes and policies. It can be influenced by many factors, including the skill of the workers, condition of equipment, environment and even the culture of the organisation. Measure of efficiency appraises the organisation’s ability to achieve output(s) considering the minimum inputs level. Efficiency, effectiveness and productivity need not be work-related. You can be very efficient at picking wild berries; but if they’re poisonous you’re not being very effective. On the other hand, picking nutritious berries might be effective, but doing so by choosing only the large ones and removing them from the bush one at a time might not be the most efficient way of doing it.
The position of an organisation’s productivity can be classified into four quadrants: Dark (A), Grey (B), Grey (D) and Golden (C). Quadrant (A) is where the organisation involved has low effectiveness and low efficiency, it means, neither the services/products that organisation presents to its customers is correct nor the goals of the organisation can be achieved. Therefore, this is the end of activity for the organisation.
But, in Losses Quadrant (B) & (D) because of defects in one of the necessity elements of productivity and effectiveness, customers are not satisfied with the organisation’s performance. This problem has appeared in a short time and because of good efficiency and bad effectiveness, this view brings-in short-lived profitability. Also, on the contrary, emphasising on effectiveness and disregarding efficiency may lead to ‘unprofitable growth’ that happens in Losses Quadrant (B) & (D). In addition, in the second Losses Quadrant (B) & (D), the goals of organisations are obtained but not with the same resources; organisation in order to achieve their goals, should allocate more resources and budgets, which otherwise leads to ‘slowly dying’. Although, how long the organisation can survive depends on if they are governmental, private, small, or large sized organisation. Thus, if organisations do not attempt to run away quickly from their current position, they will fall in the Dark Quadrant. On the other hand, Golden Quadrant is the ideal position that each organisation would desire to be located in.
Thus, it is necessary that organisations pay attention equally to the effectiveness and efficiency and only then growth of profit can be maintainable. With right productivity, organisations will be able to provide better services/product and also win customer hearts with their effectiveness.