The factors of production can be combined in any number of ways, some more efficient than others. When they are combined efficiently, productivity will be relatively high. When they are combined inefficiently, productivity will be relatively low. Decisions about combining the factors of production rest with management.
In the production process, for example, it is management's responsibility to acquire the necessary capital (in the form of machinery, tools and equipment). Similarly, management must hire and train the firm's labor force and motivate the workers to do the job. In other words, managers must employ both capital and labor to maximize productivity.
Another way to increase productivity is to let workers participate in designing and improving the production process. Profit sharing and stock ownership also motivate workers. This is exactly what many companies now do. It has been found that workers with a stake in the firm's welfare work smarter because they get part of the profits when productivity increases.