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Measuring Productivity as an Operations Manager

Productivity is measured by the ratio of outputs to inputs. Some organizations use a partial measure of productivity to measure actual operations, such as a restaurant using a number of customer meals per labor hour.
Assume that you are the operations manager of a local restaurant. You currently measure the following data:

Labor hours
Raw materials
Customer meals
Capital investments

Based on the above information, how would you measure productivity at the restaurant? Be sure to include single-factor and multifactor measures. What are some simple ways you would use to improve productivity? As an operations manager, why is productivity important to you?

Solution Preview

Let us look at some single-factor productivity measures in this scenario. Single-factor productivity measures are also termed partial productivity measures and measure productivity based on a single input. The manager can measure:

Customer Meals/labor hours - this would determine the speed of throughput.

Customer meals/ raw materials - this would determine how much ingredients are needed for a meal to be produced. This number is beneficial as the less raw materials that can be used without reducing the value of the meal, the more cost efficient the firm.

Customer meals/capital investments - this measures the efficiency with which fixed capital is used to produce meals. The operations manager can review how the quality of the kitchen equipment impacts the ...

Solution Summary

The following posting helps with a problem that involves measuring productivity as an operations manager.

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