A major determinant of organizational productivity is the design of structures and processes within a functioning organization. Research has focused on structures that contribute to productivity, but has given much less attention to the processes that occur particularly in health service organizations. We examined the relationships of organizational process and productivity in 20 nursing work groups in a sample of local health departments in North Carolina. Analysis focused on level of organizational climate (communication flow, decision-making practices, motivational conditions, concern for human resources), leadership behaviors, and quality of group interactions. The relationships of these processes to productivity (number of services produced per unit of staff time available) across a series of major departmental services were evaluated, together with implications of findings for strategies to improve the functioning of nursing work groups.