Productivity Analysis, Differentiate between productivity analysis and profitability analysis.

What do you mean by productivity analysis? Differentiate between productivity analysis and profitability analysis. What are the different steps in the direct and indirect approaches to marketing budgets?

My Answer

 

Productivity analysis refers to the process of differentiating the actual data over the

estimated data of output and input measurement and presentation.

 

In economics, productivity is the ratio of the output production per unit of input. It

may also refer to the technical efficiency of production relative to the allocation of

resources of enterprises.

 

If the goal is to increase productivity, enterprises must produce more with the same

level of input. The goal can also be done by maintaining the same level of output

using fewer inputs. The drive to increase productivity can be caused by various

factors, but perhaps the most apparent is the aspiration of an enterprise to increase

profitability.

 

There are certain factors affecting the productivity of entities. General categories of

the factors concerning productivity include the labor force, product, quality,

process, capacity, and external influences. Resources are also important to consider

in assessment of productivity of an entity.

 

Measuring the production level of an entity may take certain processes that include

data acquisition, data summary, and comparison. In obtaining data, documenting

the activities of an entity helps in creating tangible reports of certain group

transactions. Documents and files can be extremely valuable, particularly during

the performance evaluation.

 

Productivity analysis may be seen as an evaluative activity of the performance of

an entity. The purpose of it being employed is to provide the appropriate solution

to a problem that hinders the attainment of production goals in the present and

future of the company. The findings from productivity analysis being undertaken

are indeed of great help in providing an entity the necessary changes to be

implemented for the realization of its production goals.

 

Productivity is a measure of output from a production process, per unit of input.

For example, labor productivity is typically measured as a ratio of output per labor hour, an input. Productivity may be conceived of as a metric of the technical or

engineering efficiency of production. As such, the emphasis is on quantitative

metrics of input, and sometimes output. Productivity is distinct from metrics of a

locative efficiency, which take into account both the monetary value (price) of what is produced and the cost of inputs used, and also distinct from metrics of profitability, which address the difference between the revenues obtained from output and the expense associated with consumption of inputs.

 

The starting point is a profitability calculation using surplus value as a criterion of

profitability. The surplus value calculation is the only valid measure for

understanding the connection between profitability and productivity or

understanding the connection between real process and production process. A valid

measurement of total productivity necessitates considering all production inputs,

and the surplus value calculation is the only calculation to conform to the

requirement.

 

The process of calculating is best understood by applying the term ceteris paribus,

i.e. "all other things being the same," stating that at a time only the impact of one

changing factor be introduced to the phenomenon being examined. Therefore, the

calculation can be presented as a process advancing step by step. First, the impacts

of the income distribution process are calculated, and then, the impacts of the real

process on the profitability of the production.

 

The first step of the calculation is to separate the impacts of the real process and

the income distribution process, respectively, from the change in profitability (285.12 – 266.00 = 19.12). This takes place by simply creating one auxiliary column (4) in which a surplus value calculation is compiled using the quantities of Period 1 and the prices of Period 2. In the resulting profitability calculation, Columns 3 and 4 depict the impact of a change in income distribution process on the profitability and in Columns 4 and 7 the impact of a change in real process on the profitability.

 

Direct marketing is a form of advertising that reaches its audience without using

traditional formal channels of advertising, such as TV, newspapers or radio. Businesses communicate straight to the consumer with advertising techniques such

as fliers, catalogue distribution, promotional letters, and street advertising.

 

Direct Advertising is a sub-discipline and type of marketing. There are two main

definitional characteristics which distinguish it from other types of marketing. The

first is that it sends its message directly to consumers, without the use of intervening commercial communication media. The second characteristic is the core principle of successful Advertising driving a specific "call to action." This aspect of direct marketing involves an emphasis on trackable, measurable, positive responses from consumers (known simply as "response" in the industry) regardless of medium.

 

If the advertisement asks the prospect to take a specific action, for instance call a

free phone number or visit a Web site, then the effort is considered to be direct

response advertising.

 

Direct marketing is predominantly used by small to medium-size enterprises with

limited advertising budgets that do not have a well-recognized brand message. A

well-executed direct advertising campaign can offer a positive return on investment as the message is not hidden with overcomplicated branding. Instead, direct advertising is straight to the point; offers a product, service, or event; and explains how to get the offered product, service, or event

 

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