Productivity Measurement: An Introduction

Reconciliation of financial accounting systems and productivity measurement systems is not necessary to support productivity management. By first separating productivity measurement from the financial accounting system, and then limiting productivity measurement to those labor-intensive activities that are controlling the project, the contractor avoids incurring significant increases in overhead support costs when the productivity management process is added. If the activities being monitored are critical to establishing the project duration, then the ability of the owner and contractor to meet project schedules is further improved. (RS2-3, p. 4)

Productivity is a frequently discussed topic in the construction industry because productivity improvement translates directly to labor cost savings. A growing consensus among owners and contractors indicates that measuring and monitoring productivity are essential first steps to managing, that is improving, productivity. (RS2-3, p. 19)

Numerous systems for monitoring and measuring productivity are commercially available; as are many proprietary systems, yet a large number of today's contractors do not apply these techniques. Key among the reasons for not doing so is an inability or unwillingness to grapple with the complexity and support costs associated with traditional cost-system approaches. Uncoupling productivity measurement from cost measurement can remove obstacles and enhance more universal use. (RS2-3, p. 19)