For those of you with current or previous work experience, how is
(was) productivity measured in your
organization. Discuss the concepts of total production,
average production and marginal production. Relate
production to cost and discuss how the ideas of total cost, average
cost and marginal cost are used in decision making.
Productivity in my previous organization was measured as number of cases closed per hour. I was into content support and our productivity was calculated using the cases we worked upon. And also how many cases we work upon each additional hour.
Total production refers to total output produced
Average production refers to output produced per hour
Marginal production refers to additional output produced when one more hour is worked.
Productivity efficiency is best measured when marginal production is compared to marginal cost of employee.
It is the additional cost incurred of hiring an employee per hour.
The best way to check for profit maximization is by equating marginal cost to marginal revenue brought in by selling the additional output created.
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