Total Productivity — and its Link with Pay

As one small part of a research project funded by the Science Research Council we have been working recently inside several British factories in an attempt to isolate the mechanisms of corporate productivity. Our ultimate objective is to derive robust measures of productivity in terms of batch manufacturing characteristics (e.g. product mix, throughput time, etc). But how does one measure productivity? It sounds simple until the range of possibilities is considered. After considering the range we eventually opted for “total productivity” measurement and this short article describes how we went about it. We applied this approach, for example, to a single, large machine shop in a heavy manufacturing firm; to the comparison of performance of several subsidiary firms within a group specialising in large batch production of high precision units; and to the overall performance of a firm in small batch production of technically complex units for military use.