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Improving Productivity and Reducing Costs in Terms of Human Resource Management

4 pages
922 words
Harvey Mudd College
Type of paper: 
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The primary aspects of any business are improving productivity and reducing costs. The two elements help a company maintain a competitive edge in the market. Productivity measures the relationship between the level of inputs and outputs of a company. For a business, high productivity means that many products can be produced at the same costs because each unit cost is lower. Productivity can be as a result of the efficiency of labor and technology as well as the effectiveness of management. In any firm, employee motivation increases productivity. Supervisors have to increase their employees motivation for the firm to be productive. The paper describes the relationship between methods to improve productivity and reduce costs as well as the way the methods impact employee motivation.

Improving productivity and reducing costs can be either independent processes and mutually exclusive. For example, productivity can be independent from cost reduction in a way that it is a matter of working smarter. Essentially, gains in productivity arise from the efficiency of technology and management (Rue & Byars, 2010). On the other hand, the authors affirm that gains in cost reduction arise from the efficiency of labor. In essence, one can affirm that the two aspects are independent processes because they have two different measures that make it necessary for it to be achieved. As it is known, a company can improve their productivity without having to reduce costs. For instance, creating goals and providing feedback to employees can help to improve their productivity. On the contrary, they are mutually exclusive when a company indulges in improving productivity without having to reduce costs. A company can decide to engage in the processes separately over a long period. In that case, employee motivation is interrelated because without it, productivity and cost reduction cannot occur. Rue & Byars articulate that supervisors have to engage employees in the cost reduction process by asking employees for their ideas and considering them. As well, Rezaei, Rezaei, Zare, Akbarzadeh, & Zare (2014) indicate that cost reduction and productivity can result in employee satisfaction. Supervisors can achieve success if they involve employees through the process.

On the subject of improving productivity and reducing costs, a supervisor can achieve success for his team in many ways. Rue & Byars (2010) affirm that supervisors, managers, customers, and employees benefit from methods improvement. The supervisor can improve productivity by restructuring the scope of the task and eliminating unnecessary work. The elimination of unnecessary work can lead to decreased costs. For example, when there are tasks at the workplace that lead to delays, poor quality, and employee dissatisfaction, supervisors can find a way to achieve impressive improvements in that job. Omisore (2014) affirms that supervisors have to improve the work flow by being available and involved with employees. Furthermore, motion study and time study are methods of improving productivity (Rue & Byars, 2010). Regarding motion study, the authors assert that the supervisor has to identify the tasks being performed, evaluate them, and question the necessity of each step to identify inefficient work. The authors aver that some of the questions which the supervisor should ask include why is the task necessary? What would be the cost of eliminating it? On the other hand, the authors explain that time study determines the times required to perform a task effectively. As they explain, the supervisor has to monitor work standards by analyzing all control points. On a broader perspective, when the supervisor follows the methods of improving productivity and reducing costs, employees can have improved satisfaction.

A specific scenario where productivity increased and cost decreased without negatively impacting motivation was at the workplace in a high school. The upper level management in association with the supervisor attempted to reduce the administrative costs. Some of the activities organized by the school administration incurred hefty expenses. A lot of time was spent on these event days and the employees, especially those working on the administration block were idle during those days. Even so, in other departments such as the tuition block and kitchen area, various events were held separately. The supervisor decided to consolidate the incidents. He combined some of the events such as parents day and employee recognition day were held on the same day. More so, training days and celebrations were held on the same day. Before the consolidation, the supervisor consulted with the employees and got some ideas. He managed to improve employee motivation because he engaged the employee through the cost-reduction process.

In summary, the supervisor is the most significant person in any organization because he or she helps in cost reduction and improving quality. Even though the staffs such as budget analysts have plans to reduce costs, they depend on the supervisor for inputs and implementation of these plans. Beyond doubt, when supervisors are vigilant about costs reduction, employees will be concerned about costs as well. Furthermore, cost reduction should part of an organizations normal routine and should cover all departments of an organization. Overall, firms should create an appropriate work environment where employees are satisfied and supervisors work to improve productivity and reduce costs constantly.



Omisore, B. O. (2014). Supervision Essential to Productivity. Global Journal of Commerce & Management Perspective, vol. 3, no.2, pp 104-108.

Rezaei, M., Rezaei, M., Zare, M., Akbarzadeh, H., & Zare, F. (2014). The Effects of Information Technology (IT) on Employee Productivity in Shahr Bank (Case study of Shiraz, Iran). Applied mathematics in Engineering, Management and Technology, pp. 1208-1214.

Rue, L. W., & Byars, L. L. (2010). Supervision: Key Links to Productivity. 10th Edition. New York, NY: McGraw Hill.


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