Management’s Role in Declining Productivity

by Y. Shetty

Fall 1982

Volume 25
Issue 1

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The article focuses on the management's role in declining productivity. When productivity decline is analyzed, two things always come up, these are government regulation and labor. Scattered evidence suggests that responsibility for recent productivity decline may belong partly to management. Having slowed since the mid-1960s and experienced absolute declines in the year 1979 and 1980, the U.S. productivity growth rate is now one of the lowest of all industrialized countries. When productivity lags, it contributes significantly to ever-spiraling inflation and unemployment, lessens the international competitive position, pushes the value of the dollar downward, and lowers profits at the corporate level. The purpose of this article is to analyze the role of management in declining productivity. First, the role of management is defined by focusing on some of the specifics of management practices and behavior that have a potential for negative impact on productivity. Second, the emerging trend in management's attempts to change the prevailing practices is examined. Finally, special attention is given to management initiatives aimed at improving productivity at the firm level.

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