Measuring Production

4.3 System of Measuring Production

In the application of Producer Rewarded Open Market Economics or any other economic system a system of measuring production should be maintained.  The system of measuring production would measure each Producers production level.  The exchange or payment for each Producers production would be correlated with the measure of production for each Producer.  In this way the correct amount of pay would be transferred to each Producer producing in a group of producers.  This System of Measuring Production would be applied to all individuals operating in a producing group, organization, company, corporation, society, or nation.  All individuals would include all owners and management Producers in the group of laboring and working Producers.

This System of Measuring Production would insure no non-production or counter-production would be rewarded.  This System of Measuring Production would ensure the viability and prosperity of the producing individuals, groups, organizations, companies, corporations, societies and nations.

The correct way to reward individuals producing in a specific organization is for a System of Measuring Production to be maintained.  This System of Measuring Production would measure the production created by each Producer in the organization.  The production would be delineated in production units.

We could use the Professional Sport system of measuring production as an example.  Professional Athletes should be paid based on their measured production.

Currently they are paid by a pre-determined contract.  Their pay for production is determined before the production has been performed.  It is based on their past production that they have previously been paid for.  When most players join a major team they start with a base pay contract.  When their production levels increase they sign a higher value contract.  These contracts are predetermined pay contracts.  The contract establishes a predetermined pay that is set into the future without measuring the player’s exact future production levels.

This leads to rewarding non-production or counter-production.  In many cases the athlete’s production level is lower after he signs the contract than it was before he signed the contract.  There are other cases after the contract has been signed; the athlete’s production level jumps to very high levels while he is stuck in a low paying contract.  Or, times when the athlete is injured, he continues to receive high pay with no production at all.  At a time like this his pay should fall back to a base pay or zero pay.

This situation of paying individuals without maintaining a direct measure of production is not exclusive to athletes.  It occurs throughout industry and throughout the societies of the world.

When Producers are paid by an hourly pay system, they are being paid by a measuring system that does not directly calculate their production level.  In the hourly pay system many Producers produce at much higher production levels than other producers doing the same work.  They both receive the same pay.  The high Producer is carrying the low Producer on his back, figuratively speaking.   The low Producer is accepting money, value, energy, wealth, capital, power and prosperity that he did not create.  The high Producer is not receiving all the money, value, energy, wealth, capital, power and prosperity he created.

I have also found the system of hourly pay applied to counter-producers.  I have seen counter-producers actively creating destructive actions and receive pay for the hours they put in.  They are receiving money, value, energy, wealth, capital and power for exchanging destruction for it.

I have seen management in organizations going out of their way to ensure the poor helpless non-producers and counter-producers receive pay because they will never have much in life.  They allow counter-producers and non-producers to receive pay based on an hourly pay system.  In many cases they receive the same or more pay than the Producers and Super-producers.   I have seen management tell Producers and Super Producers; “you will always find a job and provide for yourselves but these people (non-producers and counter-producers) will never have much.  We want to give them an opportunity and help them.”  This is a case of misguided help.

This misguided help is a principle found in Carl Marx’s Communist system.  The Communist principle is, “to each according to his needs.”  Producer Rewarded Open Market Economics is operated by the principle of, “to each according to his production level.”  The Producers own what they create.  When the creation is exchanged on the Market, the Producers receive all of the money, value, energy, wealth, capital, and power paid for their creations.   When Producers operate in groups, each Producer receives pay based on their produced portion of the final product.

I have seen a few Super Producers hold an organization together and make it prosper despite the misguided help handed out to non-producers and counter-producers.  When the Super Producer leaves the organization, the whole organization collapses.  No one in the organization has a clue as to what made the organization prosper.  They also don’t have much knowledge on what caused the collapse.  They had been attributing the prosperity of the organization to luck, a management style of anger and hostility, or it “just happens.”  A note here; a management style of anger and hostility is a counter-productive activity.  Producers lose motivation in a hostile environment of anger and hostility.

Management and ownership are other areas where over-rewarded individuals are found.  There are Super Producers in management and ownership.  They are a tremendous asset to an organization.  They can really make an organization prosper as long as they reward Producers and Super Producers.

There are non-producers and counter-producers in management and ownership as well.  In many cases they are a massive drain on the money, value, energy, wealth, capital, power and prosperity of the organization.  It is very important that management and ownership be required to have measured production before they receive pay.  Their production must be defined and measured.  Their pay must be based on their production level.  I have seen managers and owners sit on top of an organization and provide far less production than the pay they receive.  I have seen managers and owners sit on top of an organization and provide destructive actions.  They receive high pay while exchanging destructive activities.  A manager or owner practicing the misguided help of rewarding non-producers and counter-producers is rewarding destruction that harms the organization and all Producers in the organization.

It is important that all management, owners and all other individuals in an organization are functioning as Producers and Super Producers.  An organization operating with all individuals functioning as Producers and Super Producers will create tremendous prosperity and affluence.

The correct way to reward production is to pay Producers based on their measured statistical production level.  This is after a correlation has been made with the Producers ability (occupation or trade).  This eliminates the situation where individual Producers are overpaid when they under-produce.  It also eliminates the situation where individual Producers are underpaid when they super-produce.  In the case of the non-producer, there would be no pay for non-production.  In the case of the counter-producer, they would have to pay for any destruction resulting from their counter-production creations.  The counter-producer would have to pay the organization of interfacing Producers a sum equal to the damages resulting from his counter-production creations.

 Producer Rewarded Open Market Economics
The Science of Economics
By RP Obrigewitsch
May 18, 2014

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