I agree. Often 'productivity' is confused with 'performance'. People can often see 'performance' when it's happening and even measure it, often with a stopwatch, literally. This goes back to the late 19th century when people like Frederick Taylor introduced the first 'time studies' (here's where the stopwatches come out) and a few years later, the Gilbreth's added to this by developing what's become known as 'Time & Motion Studies' but again, they were measuring and observing things and events which could be seen and timed, usually with a stopwatch. Now I'm not saying that this work didn't lead to improvements in productivity, I'm sure that it did, but it did tend to get management to focus on what could be seen and observed and not what was actually happening in an organization as a whole.
In my humble opinion, this comes down to that if you true goal is to measure 'productivity' then you need to put away the stopwatches and start looking at calendars.
In our business, we sell software to engineers which helps them to become more productive. Granted, years ago when the use of computers and software was limited and confined to what we called 'islands of automation', the tendency was to look at each solution only based on what could readily measured, again often with a stopwatch, and I guess that was justified since the technology was very expensive and it's impacts limited so management needed to identify stuff which would have an immediate effect on their business processes and in our case, that meant the Design and Manufacturing workflow of products. But even then (I'm talking back in the early 80's), some of us were starting to see that the real issue was going to be the improvements in the 'productivity' of the entire enterprise but it was hard to sell that idea back then because again we were 'marooned' as it were on these 'islands of automation', disjoint pieces not connected or even aware of each others existence.
But over time that has changed. The cost of the 'seat' where a worker accesses an enterprise's data has dropped to the point where it's often no longer even an issue of "do we implement some new technology or not". Also the 'islands' were getting connected together, first with highspeed local networks linking systems in one building or on one 'campus' but eventually with the worldwide net, entire enterprises, including their suppliers and even their customers, are now linked to together to the point where distance is no longer an issue with respect to it being a constraint on doing business. In fact, some organizations are now leveraging the fact that the workday actually can be seen as moving with the Sun, from continent to continent. Standards have emerged where data, even from system developed by different vendors, can still exchange information without any loss of quality or fedelity. And speaking of vendors, like in any maturing industry, over time Darwinism has had its effect reducing the number of different technologies and products helping to eliminate the need for more exchange standards or the fear of data incompatibility as the few big players that are left work out how to share the wealth while still bringing innovation and value to the marketplace.
What these all means is that view of 'performance', that you measured with a stopwatch because you could see something happening, has given way to the more appropriate appreaciation that at the end of the day, it's 'productivity', which is measured using a calendar, is what pays the bills.
Now I know that this doesn't really meet your criteria of stating exactly what 'productivity' is or even how does onw actually measure it in a meaningful way, but I do think that it provides some insight into the fact that you have to look at the entire enterprise looking for how the pieces fit together and where does the data/service/products flow in an organization for which they are collecting money from their customers. And as been previously stated, you have to be careful because often what looks like as being non-productive behavior may be critical to the overall efficiency of a company but it's often only noticed when it's removed from the equation.
Take for example something that many people pay little attention to despite the obvious issues involved. And that's paid vacation time. Now for anyone reading this from somewhere other than the US, there are NO laws in this country mandating that a) companies even provide vacation days, paid or otherwise, and b) even if they do, there is no expectation that people will even take all of them each year. And in most states (there are only two exceptions that I'm aware of) you are likely to automatically lose any unused vacations days at the end of each year. Americans leave on the table millions of hours of vacation time each year and no one seems to think much of that since many in management considers time off for vacation as being nonproductive and therefore something which should be kept to a minimum, hence the reason WHY there are no national laws mandating vacation time. But yet study after study has shown that time off from work, particularly paid time off, enhances the overall productivity of almost any organization. This is NOT 'rocket science' yet Americans are taking off less time now than ever in the history of the country even when they have a fully paid vacation benefit. And the reasons given for not taking vacation, as stated by both employees and employers, is that they think that this helps to make companies more profitable and thus making their jobs more secure. But if productivity is really harmed by this, then these views are a myth and could actually, in the long run, harm a companies prospects of optimal success.
Now for the record, I work in one of those states, California (the other is Illinois) where a worker's unused vacation is considered as deferred compensation and therefore cannot be taken away or at least any limitation placed on 'banking' your unused days must be reasonable and fair. Note that companies can either pay employees for their unused days or they can allow them to accumulate, within some reasonable guidelines. Note that our company allows you to accumulate, IF YOU LIVE AND WORK IN CALIFORNIA OR ILLINOIS, approximately two full years of back vacation before you're forced to start using it or risk losing it. Note that I currently have just over 39 days, or nearly 8 weeks, worth of vacation 'in the bank' and I earn 30 new days each year. My goal is that when I reach the point when I plan on retiring, that I'll have my 'two years worth of vacation' in the bank which means that either I'll get a nice 'severance' check at the end or else I can just go home and continue to collect a regular paycheck, with all the other benefits, for another 10-12 weeks before my actual retirement date would officially arrive (I guees one could say that I'm a 'poster child' for why Americans take so little vacations, but at least in my case, I'm not giving it away each year).
Anyway, it will be interesting to see what other comments posted in this thread concerning what is and how one measures productivity and how companies rationalize the so-called non-productive activities.
John R. Baker, P.E.
Product 'Evangelist'
Product Engineering Software
Siemens PLM Software Inc.
Industry Sector
Cypress, CA
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