Measuring Productivity

THE 1948–49 Winter Proceedings of the British Institute of Management have been presented as a report. The fourth meeting was addressed by Sir Ewart Smith and Dr. R. Beeching who, in a joint paper, discussed the means of measuring the effectiveness of the productive unit. After defining the meaning, of productivity, the authors elaborate the factors affecting it and the problems of measurement. To arrive at a true measure of effectiveness, it is necessary to make allowance not only for the number of personnel engaged in the unit under examination but also for the invisible men who serve the unit externally in the supply of the necessary capital equipment, raw materials and other services. Sir Ewart and Dr. Beaching also consider that Marshall Aid distorts the productivity picture. The present rate of this aid is equivalent to the wages of 750,000 industrial workers at current British wage rates, and since “the total number engaged in industrial production in Gts Britain is some 10,500,000, Marshall Aid is equivalent to an increase in our industrial production of 7 per cent as a first approximation". Among points which arose in discussion were the problem of plant valuation and the need for individual firms to give more thought to the question of labour incorporated in capital equipment. The report may be obtained from the British Institute of Management, 17 Hill Street, London, W.I, price 2s. 6d.