Productivity and Efficiency

Really is there any difference between productivity and efficiency ?, What is productivity?, What is efficiency?, Formula connecting productivity and efficiency, Relationship between productivity and efficiency, Example demonstrating the relation between productivity and efficiency, etc. We will discuss all here in detail.

Before we move in to our subject, we need to know more about the terms productivity and efficiency.

What is productivity

There is a well written article on productivity in this website. So, please read the article and come back. You can go to the article by clicking the below link.

Article on productivity

What is efficiency

We have also written an article on efficiency. So, please read the article and come back. You can go to the article by clicking the below link.

Article on efficiency

I recommend to read both article before continuing on this article.

Ok, lets dive in to our subject.

Formula connecting productivity and efficiency

We have seen the formula for productivity,

Productivity = Output / Input

Now, here ‘output’ means actual output

So, Output = Ideal output x efficiency

So,

we can rewrite the formula for productivity as follows

Productivity = (Ideal output x efficiency) / Input

Now we are ready to discuss about relationship between productivity and efficiency

Relationship between productivity and efficiency

We can see from the formula of productivity, when efficiency increases productivity increases and when efficiency decreases productivity decreases.

Example demonstrating the relation between productivity and efficiency

We shall stick to our example demonstrated in the article on productivity.

lets only discuss about the input ‘electric energy (power)’ here.

Productivity what we got is 60 bottles.

At this productivity lets assume the efficiency of that molding machine for converting electrical energy to useful work was 70%.

From this data we can calculate ideal output.

Output = Ideal output x 70%

Ideal output = Output/70%

= 300 / 70%

= 300/ 0.70

= 428.57 units at 100% efficiency.

Now we shall calculate productivity of this molding machine for electrical energy, for increased efficiency.

Suppose that Industrial engineer have coordinated with the maintenance team of molding machine and increased the electrical energy conversion efficiency to 85%,and the productivity will be,

Productivity = (Ideal output x efficiency) / Input

= (428.57 x 85%) / 5

= 72.85 bottles per unit of energy

At 70% efficiency it was 60 bottles per unit.

Please note that, if you didn’t understand this example section, you have not read and understood the example in the article on productivity.

Ok, lets move further…

Difference between productivity and efficiency

We shall demonstrate the difference between these two through the following table.

Thanks for reading and supporting.

If you know any subject that can be related to manufacturing industry or industrial engineering, you can earn some income by becoming article contributor of this website. For knowing more about it, please visit Join us page.

You don’t need to have any experience in article writing, just knowledge on the subject is needed.

Also you can know more about our team of article contributors by visiting the about us page.

Latest articles from Know Industrial Engineering

• KIE Factory Stories: Why Did the Operator Refuse to Follow the Standard Procedure?
  “The procedure says to do it this way. But I know a faster way.” The supervisor was ready to issue a warning. Advertisement The operator had been using a different method for months. And surprisingly, he was producing more parts than anyone else on the shift. The Industrial Engineer decided to watch him work. The… Read more: KIE Factory Stories: Why Did the Operator Refuse to Follow the Standard Procedure?
• What is A3 Problem Solving?
  A3 Problem Solving is a structured approach to understanding problems, identifying root causes, developing countermeasures, and monitoring results. It presents the entire problem-solving process on a single A3-sized sheet of paper, encouraging teams to focus on facts, logic, and clear communication. Advertisement In simple terms Instead of creating a long report about low production output,… Read more: What is A3 Problem Solving?
• KIE Factory Stories: Why Did the Plant Head Reject a ₹20 Lakh Cost-Saving Proposal?
  “We can save ₹20 lakh every year.” The Finance Manager was impressed. Advertisement The engineering team had proposed removing a small inspection step from the production process. It would reduce labor costs, shorten cycle time and increase output. The numbers looked excellent. But the Plant Head asked one question. “What happens if we stop this… Read more: KIE Factory Stories: Why Did the Plant Head Reject a ₹20 Lakh Cost-Saving Proposal?
• What is 8D Problem Solving and How Does It Help Manufacturing Quality?
  What is 8D Problem Solving? 8D (Eight Disciplines) is a structured problem-solving method used to investigate recurring quality issues, identify root causes, and implement corrective actions that prevent recurrence. Advertisement It encourages teams to solve problems using evidence rather than assumptions. In simple terms Imagine a customer repeatedly receives defective components from your factory. Instead… Read more: What is 8D Problem Solving and How Does It Help Manufacturing Quality?
• What is Gauge R&R and Why Is It Important in Quality Control?
  What is Gauge R&R? Gauge Repeatability and Reproducibility (Gauge R&R) is a measurement system analysis method used to determine how much variation comes from the measurement system rather than the parts being measured. Advertisement It evaluates two important sources of variation: In simple terms Imagine three quality inspectors measuring the diameter of the same metal… Read more: What is Gauge R&R and Why Is It Important in Quality Control?
• KIE Factory Stories: Why Did the AI System Approve a Defective Part?
  “The new vision system has approved all 500 parts.” The Quality Manager looked relieved. Advertisement The factory had installed an AI-powered camera to detect surface defects. It was faster than manual inspection and never complained about repetitive work. But a customer returned a part with a clear scratch. The Quality Manager checked the inspection records.… Read more: KIE Factory Stories: Why Did the AI System Approve a Defective Part?
• How to Grow Faster in Your Manufacturing Career: The Knowledge, Strategies and Decisions That Make the Difference
  Why do some manufacturing professionals become managers and plant heads while others remain in the same positions for years? Discover practical career-growth strategies that go beyond technical skills, experience and hard work. Two Engineers, Two Completely Different Careers Imagine two mechanical engineers joining the same manufacturing company on the same day. Advertisement Both have similar… Read more: How to Grow Faster in Your Manufacturing Career: The Knowledge, Strategies and Decisions That Make the Difference
• What is Statistical Process Control (SPC) and How Does It Improve Quality?
  What is Statistical Process Control? Statistical Process Control (SPC) uses statistical methods to monitor a manufacturing process and understand how it changes over time. Advertisement It helps teams distinguish normal process variation from unusual changes that may require investigation. In simple terms Suppose a machine produces metal shafts with a target diameter of 10 mm.… Read more: What is Statistical Process Control (SPC) and How Does It Improve Quality?
• KIE Factory Stories: Why Did the HR Manager Refuse to Hire More Workers?
  “We need six more operators. Otherwise, we will miss the monthly target.” The Production Manager was frustrated. Advertisement Orders were increasing, overtime was rising, and the team was struggling to keep up. HR started preparing the recruitment plan. But before approving it, the HR Manager asked to observe the production line. She watched one operator… Read more: KIE Factory Stories: Why Did the HR Manager Refuse to Hire More Workers?
• What is a Spaghetti Diagram and How Does It Improve Factory Layout?
  What is a Spaghetti Diagram? A Spaghetti Diagram is a visual tool used in Industrial Engineering to map the actual movement of people, materials, or equipment through a workplace. Advertisement The movement paths often look like tangled spaghetti, revealing unnecessary travel and inefficient layouts. In simple terms Instead of guessing why an operator spends too… Read more: What is a Spaghetti Diagram and How Does It Improve Factory Layout?
• KIE Factory Stories: Why Did the Plant Head Ask for a Smaller Warehouse?
  “We need more storage space.” The Warehouse Manager was convinced. Advertisement Finished goods were filling every available corner. Pallets were blocking aisles, and the team was struggling to find space for incoming material. His solution was simple. Build a bigger warehouse. But the Plant Head asked him to check one number first. “How many days… Read more: KIE Factory Stories: Why Did the Plant Head Ask for a Smaller Warehouse?
• What is Performance Rating in Time Study?
  What is Performance Rating? Performance Rating is the assessment of an operator’s working pace compared with a defined normal performance level during a time study. Advertisement It helps an Industrial Engineer adjust observed time when the operator is working faster or slower than the normal pace. In simple terms If an operator completes a task… Read more: What is Performance Rating in Time Study?
• KIE Factory Stories: Why Did the Engineer Remove a Safety Sign?
  “Who removed the warning sign?” The supervisor was not happy. Advertisement The sign had been placed beside a machine after a small hand injury. Everyone knew the area was dangerous. But the sign was gone. The safety engineer had removed it. The supervisor stared at him. “Why would you remove a safety warning?” The engineer… Read more: KIE Factory Stories: Why Did the Engineer Remove a Safety Sign?
• What is Standard Time in Industrial Engineering and Why Is It Important?
  What is Standard Time? Standard Time is the time allowed to complete a specific task under defined working conditions, including appropriate allowances for fatigue, personal needs, and unavoidable delays. Advertisement It helps establish a realistic expectation for how long a properly trained operator should take to complete the work. In simple terms If an operator’s… Read more: What is Standard Time in Industrial Engineering and Why Is It Important?
• KIE Factory Stories: Why Did the Purchase Manager Reject the Cheaper Supplier?
  “We can save ₹8 per piece if we switch suppliers.” The Purchase Manager expected everyone to agree. Advertisement Instead, the Plant Head asked one question: “How much will we really save?” The supplier’s price was lower. But there was a catch. The new supplier delivered in larger batches. That meant more inventory. Their lead time… Read more: KIE Factory Stories: Why Did the Purchase Manager Reject the Cheaper Supplier?
• What are Value-Added and Non-Value-Added Activities in Manufacturing?
  What is a Value-Added Activity? A value-added activity is an activity that changes the product in a way the customer requires and is willing to pay for. Advertisement Examples: What is a Non-Value-Added Activity? A non-value-added activity consumes time, effort, space, or resources without increasing the value of the product. Examples: Simple Example Consider an… Read more: What are Value-Added and Non-Value-Added Activities in Manufacturing?
• Stories from the Factory Floor #06
  “Just increase the speed.” That was the Plant Manager’s answer. Advertisement The customer order had increased, and the factory was struggling to meet the target. The team increased the machine speed. Output went up. Everyone was happy. For a while. Then the rejection rate started climbing. Operators were rushing. Minor breakdowns became frequent. Rework increased.… Read more: Stories from the Factory Floor #06
• What is Ergonomics in Manufacturing and Why Does It Matter?
  What is Ergonomics? Ergonomics is the science of designing workstations, tools, equipment, and tasks to fit the worker. Advertisement The goal is to make work safer, more comfortable, and more efficient. In simple terms Instead of asking: “How can the operator adapt to the workstation?” Ergonomics asks: “How can we design the workstation so the… Read more: What is Ergonomics in Manufacturing and Why Does It Matter?
• Stories from the Factory Floor #05
  “We have always done it this way.” The sentence came up three times during the meeting. Advertisement The team was discussing a process that required six approvals before a job could move to production. Nobody could explain why all six were still necessary. So they went looking. Approval 1 was added after a quality issue… Read more: Stories from the Factory Floor #05
• What are the 8 Wastes in Lean Manufacturing?
  What is Waste in Manufacturing? In Lean Manufacturing, waste means any activity that consumes resources but does not add value from the customer’s perspective. Advertisement A process can look busy and still contain significant waste The 8 Wastes Simple Example An operator produces a component in 30 seconds, but spends another 10 seconds walking to… Read more: What are the 8 Wastes in Lean Manufacturing?
• Stories from the Factory Floor #04
  The customer called three times. Same complaint. Advertisement “The product is good, but it is difficult to use.” Quality checked the product. It passed every test. Production checked the process. Everything was within standard. Engineering checked the drawings. No problem there either. So the team visited the customer. They watched how the product was actually… Read more: Stories from the Factory Floor #04
• What are Manufacturing KPIs and Why Are They Important?
  What is a Manufacturing KPI? A Manufacturing KPI (Key Performance Indicator) is a measurable value used to understand how effectively a manufacturing process is performing. Advertisement KPIs turn production performance into data that can be monitored and improved. In simple terms Instead of saying: “Production seems slow.” A KPI helps quantify it: Output = 8,500… Read more: What are Manufacturing KPIs and Why Are They Important?
• Stories from the Factory Floor #03
  “Don’t change anything.” That was the instruction from the Production Manager. Advertisement The line had been running for years. Same machines. Same layout. Same work method. Same problems. One young engineer noticed that operators were making the same small adjustment almost every hour. She asked why. An operator replied: “Because the machine doesn’t work properly… Read more: Stories from the Factory Floor #03
• What is Performance Rate and Why Is It Important in Manufacturing?
  What is Performance Rate? Performance Rate measures how fast a machine or production process operates compared with its ideal or planned production speed while it is running. Advertisement It helps answer: “When the machine is running, is it producing as fast as it should?” In simple terms A machine may be available for production but… Read more: What is Performance Rate and Why Is It Important in Manufacturing?
• Stories from the Factory Floor #02
  “Why are we producing this?” Nobody answered. Advertisement The Production Manager looked at the planning sheet. The order was approved. The material was available. The machine was ready. So production continued. Two days later, the finished products were sitting in the warehouse. Nobody was asking for them. The Planning Manager checked the customer order. The… Read more: Stories from the Factory Floor #02
• What is Quality Rate and Why Is It Important in Manufacturing?
  What is Quality Rate? Quality Rate measures the proportion of produced units that meet the required quality standards compared with the total units produced. Advertisement It helps answer: “How much of what we produced was good without being rejected?” In simple terms If a process produces 1,000 units and 30 units are defective: Good units… Read more: What is Quality Rate and Why Is It Important in Manufacturing?
• Stories from the Factory Floor #01
  “We don’t have it.” The Plant Head thought he had heard wrong. Advertisement “What do you mean?” “One component is out of stock.” The entire production line was ready. Operators were waiting. Machines were ready. Orders had to be shipped. The missing component? It cost less than ₹20. “Check the warehouse.” Nothing. “Check incoming material.”… Read more: Stories from the Factory Floor #01
• What is Voice of the Customer (VOC) and Why Does It Matter in Manufacturing?
  What is Voice of the Customer? Voice of the Customer (VOC) is the process of collecting and understanding customer needs, expectations, requirements, and feedback. Advertisement It helps manufacturers understand what customers actually value not just what the company assumes they value. In simple terms A customer may say: “I need faster delivery.” But the real… Read more: What is Voice of the Customer (VOC) and Why Does It Matter in Manufacturing?
• What is PMTS and How Can It Help Determine Standard Time?
  What is PMTS? PMTS stands for Predetermined Motion Time System. Advertisement It is a work measurement technique used to determine the time required to perform a task by analyzing the basic human motions involved, rather than measuring the entire task repeatedly with a stopwatch. In simple terms Instead of asking: “How long did this operator… Read more: What is PMTS and How Can It Help Determine Standard Time?
• What is Heijunka and How Does Production Leveling Improve Factory Flow?
  What is Heijunka? Heijunka is a Lean manufacturing method used to level production volume and product mix over time. Advertisement Instead of allowing demand fluctuations to create highly uneven production schedules, the goal is to create a smoother and more predictable workload. In simple terms Imagine customer demand requires: A factory could produce all of… Read more: What is Heijunka and How Does Production Leveling Improve Factory Flow?