Question

First of all, explain how productivity is measured in the organization where you are currently employed. (If you are not employed then you may use a past job you had or a future one you would like to have.) Secondly, name and elaborate on two fixed costs and two variable costs associated with the firm you are currently working for.

Answer 1

Management by Objectives-

To use the management correctly using the objective technique, you need to evaluate productivity in ways that show how well the production of an employee contributes to the goals and objectives of your company.

To operate properly, staff first need to have clear, employee productivity objectives to work towards, as well as all the instruments and data they need to achieve those objectives.

If your objective is to boost customer retention by 25 percent over the next year, you will have to decide what kind of coaching and incentives you will use to guarantee that staff are willing to assist you attain that objective.

The productivity of customer retention will involve them to offer high service quality. In relation to continuing customer retention rates, staff activities need to be noted frequently to guarantee precision of readings.

Annual or six-month staff assessments should show achievements such as "20 percent decreased client complaints" and "consistently discovered alternatives to client issues." Employees should meet with their supervisors at periodic intervals to discuss their progress and fix issues as they happen. Throughout the year measuring productivity enables staff remain focused on their objectives.

Then the annual review shows how much progress has been made towards the objectives of individuals and companies. Next year, new objectives will be developed.

Fixed costs in a restaurant are things like: rent franchise fees, licenses (food and alcohol), insurance, etc. that don't change (or rarely). When opening a restaurant, fixed costs are easier to budget because they don't fluctuate a lot every month.

Things like labor, food, wages, marketing, etc. would be variable costs. When opening a restaurant, variable costs are more difficult to predict because they vary according to output. But you'll quickly know what to expect every month after several months.

You should focus on the variable costs when a restaurant owner / operator / manager seeks to reduce overall costs. Reducing labor costs can be accomplished through more efficient restaurant scheduling, improved tracking and processes can reduce food costs, and so on.