1. Cost Effective Operations and Competitiveness
Unit 3
Topic 3.2.4

2. Aims for today To understand the meaning of the term ‘productivity’.
To understand how increasing productivity helps a business to improve competitiveness.

3. To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

4. Cost effective operations
A business needs to ensure it is COST EFFECTIVE – “Producing the most economical outcome for consumers”
It does this by calculating PRODUCTIVITY – “The output per worker over a period of time”
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

5. Productivity
Q: If a factory has 100 workers and it produces 500 engines, what is the productivity per person?
A: 5
Q: Why may a business consider increasing productivity as a priority?
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

6. The importance of productivity
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

7. Effective work practices Better working conditions
Raising Productivity
Productivity
Training
New technology
JIT production
Better equipment
Effective work practices
Better working conditions
Read pages 50/51
Annotate the
mindmap
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

8. New technology & manufacturing
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

9. New technology & services
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

10. Other ways of reducing costs
Improved purchasing – using different suppliers, negotiating better deals etc
Relocation – locally, nationally or internationally
Better design – may lead to cheaper production costs or better quality products that last longer
Cutting overheads – costs not directly related to production such as R&D or marketing.
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

11. Productivity Recap: Exam style questions
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

12. Question 1
1. Ginifer’s is a company which manufactures television sets. Last year, labour productivity rose by 10 per cent.
A sales rose by 10 per cent
B labour costs rose by 10 per cent
C output per worker rose by 10 per cent
D output rose by 10 per cent
Answer C
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

13. Question 2
2. Belk’s is a company that operates a chain of sandwich shops. It wants to increase the productivity of its workers. Which one of the following is most likely to achieve this? A Opening a new sandwich shop in London B Installing new coffee machines which make coffee faster than old machines C Hiring 20 new workers D Tightening health and safety regulations in the company’s outlets Answer B
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

14. Question 3
3. Bollam’s is a company that owns a chain of health and fitness centres. Which one of the following is most likely to lead to a significant fall in costs for the firm? A fall in the. A number of workers employed by Bollam’s B annual membership fee charged to customers by Bollam’s C number of people applying for jobs at Bollam’s D prices charged by firms in competition with Bollam’s Select one answer. Answer A
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

15. Economies of scale
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.

16. Task 1 Worksheet 73: Productivity
To understand the meaning of the term ‘productivity’ and how it helps a business to improve competitiveness.