With the heavy emphasis on productivity in many management circles, an understanding of it is essential for management analysts. Productivity in its strict sense is defined as output divided by input. If output increases while input stays constant, the ratio increases and productivity increases. Conversely, if input increases and output stays the same, the ratio decreases and productivity declines. The productivity ratio, of course, can also be affected by simultaneous changes to both input and output. To measure productivity, of course, it is necessary to quantify both inputs and outputs. In a classic production environment, where countable outputs, such as widgets, are produced and reflect the true productivity of the organization, the basic model holds up relatively well. In most real-world organizations, however, where inputs and outputs may not be particularly obvious or may be more difficult to measure, assessing productivity may be more complex than is suggested above. This provides the perfect opportunity for the analyst who understands productivity to define, analyze, and model the inputs and outputs necessary for productivity measurement. Focusing attention on productivity, even with an imperfect model, often serves to improve it.
So, for management analysts to be really valuable to organizations today, a knowledge of some basic quantitative techniques, such as those discussed above, is essential. Analysts should be able to conduct basic cost and economic analysis, productivity and quality measurement, and statistical modeling studies. While complex issues or systems that require sophisticated analysis may require the analyst to work as middle man between the manager and the economist or statistician, the management analyst should be conversant with the terminology and concepts. The analyst who can conduct quantitative studies as well as the more general descriptive review will be in demand and will be perceived as an asset to the organization.