How to Measure and Optimise Employee Productivity
There are multiple reasons to focus on employee productivity, even if your business is on a smaller scale. Whether you’re a solopreneur in a one-person office or a human resources director at a multinational corporation with thousands of employees, measuring the efficiency and effectiveness of your workforce can be a central driving force in your daily operations.
If employees are the driving force of your business, it makes sense to learn how to measure their productivity and find ways to improve it. However, they are not machines you can keep running around the clock—an especially relevant statement for labour-driven companies. Investing the necessary time, resources, and brainpower to take the pulse of your company and implement strategic measures that drive productivity is imperative.
How do you make sure that your employees are as productive as possible? This guide on how to measure and optimise employee productivity will walk you through the main factors and show you how to measure them.
Employee productivity is the measure of how much work a person has done or how much they have produced. It measures the efficiency, effectiveness, and output of an individual or workforce. You can use multiple metrics to measure employee productivity.
For example, work done per period (usually per hour), the number of units produced, or the total production value (monetary value) may determine an employee’s productivity. In economic systems where human labour is the primary input to production, productivity growth is crucial for success.
Blue-collar workers are often considered more productive if they can produce at a faster rate or use fewer materials to produce the same goods. For example, in manufacturing, a standard measure of productivity is output per labour hour. If manufacturing output in an hour increases while the number of hours worked remains constant, your workers’ productivity has increased.
On the other hand, white-collar staff productivity goals may be more focused on increasing sales and raising the number of transactions conducted in a unit of time or monetary value. For example, if your organisation sells items online, you may measure the number of sales-driven landing pages your marketing team creates per month and how many leads or sales they achieve in that period.
Define your metrics
The first step to measuring employee productivity is defining metrics you will use to track performance. Metrics are units of measurement assigned to a variable or a group of variables to measure an employee’s performance, for example:
- Number of hours worked
- Number of clients served
- Number of sales recorded
- Time to close sales
These metrics have in common that they measure performance (how much work is being done) and are compared to how much was done last time, indicating whether the growth rate is positive or negative.
Depending on your business model, you may use several different metrics to assess productivity. Depending on your goals, you can measure daily, weekly, monthly, or yearly productivity. You may also want to break down your measurements by department, team, or task to know where the problem areas are.
You can learn about recruitment-specific metrics in this earlier blog post on 8 Essential Recruitment Metrics You Should Be Using.
More than just a metric
Keeping track of how your employees perform is more than just numbers and analysis; it’s about creating an environment where employees can develop in a meaningful way that encourages their talents, fosters professional growth, and ultimately leads to business success.
By looking closely at your employees’ day-to-day efforts, you’ll be able to address problems with specific workers and tailor their work tasks for maximum effectiveness. Once you’ve implemented a set of metrics that accurately reflects your team’s current abilities, you can measure how much progress your team is making over time.
Even with the emphasis on measuring employee productivity, there should be plenty of room to encourage your workers to develop their skills and learn new techniques to increase overall business performance further. Focus on your staff as a team of individuals with growth goals and ambitions, and watch your business start to perform at its peak.
Strategies to improve employee productivity
So, you have decided to improve employee productivity but aren’t sure where to start? Well, we can offer you a range of practical ways to help your workers increase their productivity.
Clearly define roles and responsibilities
Start by creating an environment that encourages communication, consultation, and cooperation among all your staff. Doing this will help them function as a team, not as a group of separate individuals, further boosting collaboration efforts and overall productivity.
Teams with seamless communication also experience less stress and confusion, which helps reduce the risk of errors and disputes that bog down productivity.
Do you have clearly defined roles and responsibilities in your organisation? If not, get a hold of your company’s mission statement and ensure that everyone in the company knows what their jobs are.
If everybody on your payroll knows what is expected of them and how they should contribute, it is much easier for everybody to perform effectively. This is important for two reasons: Firstly, by ensuring that everybody is on the same page concerning their company expectations, you can limit the confusion and frustration that may arise when different people interpret their job responsibilities differently.
Secondly, because people understand what is expected of them, they can concentrate their energies on doing that specific thing and know that their efforts will be recognised and rewarded if they do it well.
Offer rewards and recognition to optimise employee productivity
Rewarding people for performing specific job responsibilities will help them identify their value to the organisation and drive them to produce results in their jobs. However, ensure that these rewards are long-lasting and consistent with your company’s core principles, so they won’t be overused or become meaningless gestures.
Extending recognition to employees for maintaining measurably high productivity levels according to company goals is a powerful way to motivate and inspire your team to do more. You can boost morale and increase workplace productivity by actively engaging with your employees and recognising the extra effort they put into their jobs.
It is up to you as a leader to drive the overall productivity of your workforce. Start with a clear vision of what you want your team to accomplish. Have clear goals and expectations for the type of work that needs to be done, why it is essential, and how it will impact the overall success of your organisation.
Ensure you communicate these expectations throughout your team and your leadership structure. Set clear performance metrics to measure the productivity of your team’s work effectively. In addition, be sure that you are sending a message that you are fostering full collaboration between individuals and groups to ensure success.
It goes without saying that your team’s productivity depends on their level of skills and ability to perform in their positions. Hiring the most qualified and fitting employees for your company is fundamental to securing your company’s long-term, sustainable productivity.
If you need assistance with sourcing, vetting, hiring and training productive staff, MASA is here to help. We provide the industry’s best temporary and permanent staffing services for companies looking to gain an edge in their industries.
Contact MASA today to learn more and see how we can help your business be more productive.