The most important element of a company are its employees – after all, productive employees are what makes a company successful in the first place. But, according to a recent US Bureau labor report, employee productivity has been dwindling in recent years.
Here’s what employee productivity really is, why it’s important, how you can measure it, calculate it, and, most importantly, how you can increase it.
- What is employee productivity?
- The importance of employee productivity
- How to measure employee productivity
- How do you calculate employee productivity?
- How to increase employee productivity in the workplace
What is employee productivity?
Employee productivity, also known as productivity in the workplace or workplace productivity, is the measure of an individual employee’s output.
For example, a company that produces artistic bottles will want to know how many artistic bottles one employee can manufacture in a specific period of time – this number is the individual employee’s output.
As such, employee productivity shouldn’t be confused with labor productivity (workforce productivity), which is the overall economic output of a country or company per labor hour.
The importance of employee productivity
The purpose of any company is to be successful – and we’ve already established that employee productivity can make or break the success of a company. Two factors determine whether employees are successful at their work:
- Productivity – the amount of work completed
- Effectiveness is the amount of effort put into that work
Some people may spend a lot of time finishing a small amount of work – these people are more effective than productive.
Other people may finish a lot of work in a small amount of time – these people are more productive than effective.
You should always make the most out of both your productivity and your effectiveness – aim to put maximum effort into your work, and finish as much work as you can in an as short amount of time as possible.
There are several benefits to high employee productivity that prove its importance in your company – if employees are productive, the business:
- becomes more profitable
- meets consumer demand
- remains competitive
In gist, high employee productivity ensures a company remains relevant on the market.
How to measure employee productivity
In order to measure employee productivity, you’ll first need to talk with your employees and define a standard against which you’ll compare individual employee results. You can measure employee productivity by:
Measuring the number of sales
Evidence you have high productivity: High number of sales.
How do you measure it? You determine the number of sales per month your employee need to make, and then you compare their monthly results with this number.
For example, you decide that each employee should make 100 calls per month, make 20 contacts, and 10 sales. If an employee is making 120 calls, but only 5 sales, he or she is not reaching the standard. If an employee is making 80 calls, but 15 sales, he or she is beating the set standard.
Measuring goals meet
Evidence you have high productivity: High number of goals met.
How do you measure it? You determine the number of goals per month your employees need to reach, and then you compare their monthly results with this number.
Evidence you have high productivity: High profit.
How do you measure it? You define the ideal annual profit for your company. If you reach or top it, you’ve proven your employee productivity. If you fall short, your employees are not reaching their expected productivity percentage.
Clockify pro tip
Want to calculate your ideal annual profit? Check out our Hourly Rate Calculator, and learn what expenses you’ll need to account for in order to reach your ideal profit.
Measuring the amount of work completed
Evidence you have high productivity: High number of tasks completed.
How do you measure it? You determine the number of tasks per week your employees need to complete, and then you compare their monthly results with this number.
Measuring the quality of work completed
Evidence you have high productivity: All projects, no matter their number, are completed in a quality way.
How do you measure it? You determine the parameters that define a completed project as a quality and successful one, and then you determine how many of your finished projects live up to these parameters. For example, when you’re developing an app, the project is considered successful and quality if the app is functional, if it fulfills all client requirements, and if the client is satisfied.
Measuring time spent
Evidence you have high productivity: Less time spent working on a project.
How do you measure it? Set estimates for the time it will take the employees to finish all your project-related tasks, and provide the client with a project deadline based on those estimates. Instruct your employees to track time they span on these tasks. If you finish before the deadline, your team was productive with their time (and schedule).
How do you calculate employee productivity?
In order to understand how you can increase employee productivity, you should calculate the current state of employee productivity first.
There are various ways to do this, but the most common method usually involves comparing the employee’s performance against the relative cost he or she brings to the company – the ultimate goal is to receive more value from the employee than he or she is paid, but, as we’ve seen in the previous section of this post, there are more indicators of high employee productivity.
You can also calculate the percentage of possible employee productivity within your company if you follow these 4 steps:
- Step 1: Define a standard
You’ll measure all your levels of production against this standard.
- Step 2: Determine how much time you have in a workweek
If you have a five-day workweek, with a daily norm of 8 hours, you have 40 hours, or 2400 minutes of time every week.
- Step 3: Subtract all “unproductive” time from your workweek
This includes all your lunch breaks, short breaks, meetings, and similar activities. For example, if you spend about 30 minutes on your lunch break, 30 minutes on short breaks, and 1 hour on meetings every day, that’s 10 hours or 500 minutes you should subtract from your total workweek time. That leaves a clean 1,900 minutes of time you’re productive.
- Step 4: Calculate the percentage
Divide the number of available productive time (1,900) with the number of available work time per week (2,400), then multiply by 100 to get your productivity percentage (1,900/2,400*100 = 79%).
When calculating your productivity percentage, remember 2 important things:
- You can never be 100% productive
- Your productivity percentage is only the ideal figure – the employees will need to focus and avoid distractions in order to reach the company’s maximum productivity percentage of 79%
How to increase employee productivity in the workplace
In order to increase employee productivity in the workplace, you should implement the 8 following steps:
1. Improve workplace conditions
- Make sure there’s plenty of natural light in the office. Employees who work in an office with windows and enough natural light sleep 46 minutes more at night – they’re more rested and more likely to focus when they come to work.
- Include plant-life in the office. Green offices make employees more comfortable, and thus more productive with their work.
- Don’t leave your wall colors white. Employees make more errors when they work in offices with white walls – instead, opt for red (it helps with detail-oriented tasks), green (it helps motivate), blue (it boosts creativity).
2. Optimize emailing
- Block time just for emails. Instruct your employees to select a time window each day when you’ll deal with emails, and stick to this time – perform all email communication during the 1 hour after lunch, or 1 hour before you leave work.
- Keep emails short and on point. Instruct your employees to be polite, as well as precise with their questions, and straightforward with their answers when writing an email.
- Refrain from emailing your employees in the middle of the night. Such late-night emails may stress out your employees, increase their anxiety levels, and decrease their chances of performing well at work tomorrow morning.
3. Optimize meetings
- Email instead. Email is a faster and more precise means of communication, so instead of holding countless meetings, blast a group email during your time blocked hour dedicated to emails.
- Reduce the number of meetings per day/week/month. Hold only the essential meetings.
- Reduce the number of meeting attendees. Some employees may be vital for your meetings, but others who aren’t shouldn’t be obliged to attend every time. Instead, the most productive solution is to have them continue with their usual line of work.
- Reduce the time spent in each meeting. 15-20 minutes per meeting is enough for you to cover the most important points.
4. Allow flexible schedules
- Make the work hours flexible – Instead of working 8 continuous hours per day, let your employees work in two smaller time blocks that together equal 8 hours. For example, let them clock in work time from 7 AM to 1 PM, go to the gym/long lunch, and then finish their workday from 3 PM to 5 PM. They’ll feel more productive and efficient – they’ll get a fresh surge of energy after the long, fulfilling 2-hour break, and avoid the dreaded afternoon slump employees tend to feel before “closing” time.
- Allow remote work – In spite of some remote work challenges, 65% of employees believe they’re more productive when they work outside of the office, and 47% wish their company provided this benefit. Select positions eligible to work remotely, define availability hours for remote workers, define specific response time, and instruct employees to log their time for productivity reports.
5. Provide better employee training
- Use specialized software. Learning Management Software, such as Lynda or TalentLMS, provides various useful courses that help employees expand on their old skills and learn some new ones. They also offer analytics and statistics, so you can track your employee progress.
- Provide hands-on training. This type of training lets the employees test out the efficacy of certain training tasks, by giving them the opportunity to try them as they learn about them.
- Allow employees to learn at their own pace. Rushing through complicated topics won’t allow new knowledge to stick, or employees to test out their newfound skills. It’s best to leave employees time to process their training.
6. Stop micromanagement in task delegation
- Manage expectations and requirements instead. If you’re looking for a specific outcome, you’ll have to provide guidelines to your employees. You’ll also need to let your employees know what you expect from them – and not all well-meaning task requirements will lead to the right task expectations, so if your employees are more focused on their goal than the means of getting there, you’ll have less to worry and micromanage about.
- Once you delegate, leave the room. The employees will feel more independent, more relaxed), and more confident in their skills if there isn’t a supervisor constantly looming over their heads.
7. Improve office communication
- Build teamwork purposefully. Productivity-rich teamwork doesn’t happen by accident – you and your team will have to make an effort to become an effective team. You can start by hosting casual get-togethers from time to time – throw an office party, initiate an employee outing, organize a team building paintball match. When new employees arrive, make sure they feel welcome in the workplace, and equal with their new colleagues.
- Find the ideal means of communication. Your company may use a communication tool, email, and phones for communication, but you’ll need to learn how each employee replies best. Some may reply quickest to Slack messages, some to email messages, and some are prompt in answering their phones.
8. Encourage self-care
- Encourage the use of health insurance benefits. Make sure employees are aware of all health benefits the company offers, and then make sure to encourage them to take the available full-physical exams, vaccinations, and other benefits.
- Offer beneficial self-care courses. You can sign up your employees for stress relief or time management courses, to help them learn how to alleviate everyday stress, manage their time better, or learn any other useful self-care techniques.
- Recognize employee accomplishments. It seems practical to address your employees only when you need to point out mistakes in their work, but this isn’t a productive practice. Employees like to know that their hard work is appreciated – 79% of professionals quit their jobs due to a lack of appreciation at the workplace. Such a gesture helps lift their confidence – so, take the time to highlight people’s achievements and strong points when you can.
Clockify pro tip
Interested in some more work efficiency tips that will help you improve your employee performance? Check out our 58 time management tips for work, and guide on how you can improve your time management skills.
Once you’ve understood the importance of employee productivity for the success of your company, you’ll need to implement the right steps to measure, calculate, and most importantly, increase this valuable business resource.
In order to do so, you’ll need to pay equal attention to what’s beneficial for your company and what’s beneficial for your employees – make sure you improve workplace conditions, optimize emailing and meetings, allows flexible employee schedules, provide optimal employee training, refrain from micromanaging everything, improve office communication, as well as encourage employee self-care.