Describe the methods used to improve productivity and critically discuss whether a growing market is a necessary precondition

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For most firms profit has always been the ultimate goal to achieve. There are various ways to achieving theses objectives. Some seek to do so by increasing their sales, cutting production costs, improving product quality better advertising and many other ways could have a significant impact. However productivity improving is key to reaching success for a company. An important factor to be wary of is the market that a firm finds itself in, this could be pivotal to the amount of productivity achieved.

Lets take the motor industry for example. Around circa 1900 Henry Ford wanted to revolutionise the automobile industry, by producing an affordable model, which would mean that not only the wealthy would be able to afford to own a car. Ford manufactured the T-Model on the assembly line using division of labour or specialisation, which meant workers were trained to only perform a specific and limited amount of tasks, which meant that productivity increased. However in the early days of the Model-T the workers used the cottage industry method before they started using the assembly line. The cottage industry method meant that much worker time was needed and this slowed down productivity little bit. “Passed assembly lines increase productivity and minimise costs in mass production ” (A. Dolgui, Jean Marie Proth p.237). However before Ford started the manufacturing of the Model-T at Highland Park, he did his research on the growth of the motor industry. He noticed that the motor industry was growing rapidly. So he seeked for ways to develop a very reliant product using a low cost production method. He even went as far as researching the motor race industry to see what material was used for the race cars as he thought it might have an influence on the type of production methods they would use. I think that productivity can influence market growth. Once the market starts to produce signs of growth this acts as an incentive for firms to increase their productivity as they



Bibliography: 1. Supply Chain engineering: Useful Methods and Techniques – 2010 2. The Economics of Collusion -2012 3. The Evolution of Manufacturing a Toyota System ONLINE RESOURSES 1. http://www.thetruthaboutcars.com/2010/01/too-good-to-be-true-how-toyotas-success-caused-killer-decontenting

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