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Profitability: Lowering costs or increasing productivity
May 30, 2022 11:34:00 AM2 min read

Profitability: Lowering costs or increasing productivity

It is very clear that in a competitive and economically difficult environment there are two ways of improving profitability: on the one hand, "lowering costs" and on the other, "increase productivity". But if we talk about lowering costs, it is very difficult to do because companies, in general, have already reduced the expenses as much as they could. On the contrary, increasing productivity is more likely and less limited.  

Productivity in companies is vital to grow or to increase profitability; the latter is the result of the actions that must be taken to achieve the company's goals and create a good working environment. 

The increase in productivity has many benefits for companies of all sizes and sectors:

  • It helps you achieve business goals better and more efficiently. 
  • It saves time which allows you to carry out more tasks in less time and, usually, with less effort. 
  • It provides more agility to business and/or companies; and, therefore, flexibility for accepting changes in our customers' demands or the market in general. 


Achieving an increase in productivity demands good resource management to accomplish the tasks carried out in the company efficiently, i.e. from beginning to end. Productivity is usually associated with efficiency and time:  the less time you invest in achieving a particular result, the better the productive character of the system used in the company or business will be.

The key point is in the improvement of work processes by designing them better and more efficiently, with more planning. This helps you detect which elements are not working properly and those that aren't useful to achieve your goals; it is vital to increase the productivity of each business if you want to succeed. 

This improvement in processes is achieved in three ways: reducing the time when carrying out tasks, eliminating or substituting the tasks in these processes totally or partially, or incorporating new functionalities that add value to the existing process. 

This way, productivity works as the relationship between the created value and the used resources and, although it seems obvious, the goal is to maximize the service value with optimal use of resources. 

If we think about how technology has contributed to the optimization and improvement of processes, we will see that, in most cases, the digital tools that have strengthened as part of the operations of a company are those dedicated to reducing time and automating tasks. 

We should also be aware that the impact of digital tools is accompanied by a series of benefits for companies, improving their internal performance and their relationship with customers. Below, you can find some of them: 

  • It improves employees' satisfaction: Thanks to the implementation of digital tools, employees can be more productive and their operative efficiency will also increase. 
  • It improves customers' experience: Digitizing some of the company's processes increases the rate of customer retention. Moreover, digital channels allow you to be in touch with your customers easily and dynamically.
  • It provides new business opportunities: Transformation and innovation go hand in hand. Technology provides new skills and new business processes that favor innovation and new ideas. 

Finding elements that don't work properly and that aren't productive for achieving goals is vital to increase the productivity of each business if you want to succeed. 



A new concept in management


Drew's editorial team

A company focused on developing solutions of genuine value to other companies. We are passionate about transforming the way people work, optimizing processes and promoting business growth.

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