Textbook Notes (362,734)
Canada (158,032)
MGTA02H3 (361)
Chapter 2

chapter 2 notes

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University of Toronto Scarborough
Management (MGT)
Chris Bovaird

Chapter 2 Increasing Productivity and Quality Notes The Productivity-Quality Connection N productivitya measure of efficiency that compares how much is produced with the resources used to produce it N by using resources more efficiently, the quantity of output will be greater, but unless the resulting goods and services are of satisfactory quality (the right things), consumers will not want them N qualitya products fitness for use in terms of offering the features that consumers want Responding to the Productivity Challenge N companies must design their marketing efforts to cultivate a more customer-oriented focus N as quality-improvement practices are implemented, more and more firms will receive payoffs from these efforts and 4 factors interact in this process: customers, quality, productivity, and profits Measuring Productivity N labour productivitypartial productivity ratio calculated by dividing gross domestic product by total number of workers N it compares a countrys total annual output of goods and services with the resources used to produce that output N the focus on labour, rather than on other resources (such as capital or energy) is preferred because most countries keep accurate records on employment and hours worked Domestic Productivity N nations must be concerned about domestic productivity regardless of their global standing N a country that improves its ability to make something out of its existing resources can increase the wealth of all its inhabitants, conversely, a decline in productivity shrinks a nations total wealth N when that happens, increase in 1 persons wealth comes only at expense of others with whom he or she shares economic system Industry Productivity N there are differences between manufacturing and service sectors, industries within sectors differ vastly in terms of productivity N productivity of specific industries concerns many people for different reasons: labour unions need to take it into account in negotiating contracts, since highly productive industries can give raises more easily than can less productive industries Company Productivity N high productivity gives a company a competitive edge because its costs are lower and as a result, it can offer is product at a lower price (and gain more customers), or it can make a greater profit on each item sold as well as allowing companies to pay workers higher wages without raising prices; productivity of individual companies is also important to investors, workers, and managers Total Quality Management Managing for Quality N total quality management (TQM)a concept that emphasizes that no defects are tolerable and that all employ
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