Productivity Vs. Production

Production

Is the process of combining units of natural, man-made and human resources to create goods and services that can satisfy human wants and needs

Productivity

Is the increase of output from each unit in the production process. Ways to achieve productivity are by:

• training workers

• introduction of machinery in the production process

• introduction of equipment in the production process

Simply put production is when you actually make something and productivity is the state or measurement of how much you are making

The Importance of Productivity

It increases output, high productivity results in lower cost per unit of output resulting in higher levels of profit for a business

Higher profits for the firm will mean more funds available for it’s expansion and new business ventures also since costs of production are lower the business may want to give benefits to consumers in the form of lower prices