When productivity concepts are discussed, five important questions arise. Before starting to talk about productivity, let us find some answers to these five issues.
What is productivity? Technically, productivity is the ratio of output to input. It is a measure of how efficiently and effectively a business or economy uses inputs such as labor and capital to produce outputs such as goods and services. An increase in productivity means that more goods and services are produced without increases of labor and capital. It is not about cutting costs. Productivity is “doing things right” and “doing the right things” to achieve maximum efficiency and value.