A few factors may affect the productivity of an organization. Which factors affecting productivity are discussed below:
Factors affecting productivity
- Technology: Technology dictates productivity ratio. The more modern the technology the higher the productivity.
- Supply of raw materials: Dearth of raw materials can hamper productivity drastically.
- Employee motivation: It is one of the most important factors that affects the productivity of a firm. The higher the motivational factors (wages, benefits, promotion etc) the higher is the production.
- Legal System: The Legal system of a country or State may dictate productivity of a certain commodity or service.
- Economic conditions: The Economic condition of firms, as well as the country as a whole, may determine the ratio of productivity.
- Knowledge & Skills: Knowledge, skills, and attitudes of the employees play vital roles in productivity.
- Supervision/management: Proper supervision, monitoring, leading and management all together are important factors for productivity.
- Competition: In a competitive market, productivity is supposed to be higher than that of a dull market.
- Standardization: Standardization of quality & quantity dictates productivity ratio of an industrial concern.
- Technical glitch: Sudden collapse may restrict productivity drastically.
- The demand for the product: Market forces such as demand & supply many decide the productivity ratio.
- Profitability: The higher the profitability the higher is the productivity ratio and vice versa.
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