Employee Productivity in the Workplace
Here is everything you need to know about employee productivity, including how to measure it, challenges, and the benefits of getting it right.
A productive workforce creates more in less time. Unfortunately, it isnt always easy to make your workforce productive. You need to give employees the right training, tools, and motivations to enable them to work in an optimal way.
Failure to do this could be costly to your business. A survey by Salary.com and America Online found that employee time-wasting costs employers in the U.S. $544 billion in lost productivity every year.
Meanwhile, in an interview with The Washington Post, efficiency and workflow consultant Edward G. Brown estimated that unwanted interruptions were causing employees to waste between 40 and 60 percent of their time.
The question is- What can you do to make your workforce more productive?
Employee Productivity Defined
In short, employee productivity is the measure of what your employees produce in a specified amount of time.
This calculation could relate to the amount of revenue an organization brings in compared to the total hours worked. A productive workforce will create more revenue per hour than a non-productive one in a similar industry.
Employee productivity also has a direct correlation to output. Output varies across various industries. For example, it could be determined as the number of customer queries answered by customer support personnel per hour, or the number of hamburgers a fast-food restaurant franchise serves per day.
A productive team will produce a high amount of the defined output per time period, while an unproductive team will produce a lower amount of output.
Challenges in the Workforce
There are many reasons why an organization, team, or employee could be unproductive. Identifying the issues that are holding your business back is the first step to increasing productivity.
Here are some things to look out for-
Ineffective Processes- In some cases, employees will put in the effort, but fail to deliver the desired results.
Imagine a chef that cooks each dish individually rather than multiple dishes at the same time. In the former situation, the chef is working hardmaybe even harder than in the latter situationbut still struggles to be productive due to this ineffective way of cooking.
The challenge for managers is to put in place effective processes and standards for workers to follow that ensure efficiency.
It is important to also build processes that apply for all tasks that need to be completed.
Not Using Tools Correctly- Using the wrong tools are a sure-fire productivity killer, as is using the right tools incorrectly, or old or broken tools that dont work as they should.
Be sure to train your employees about how to operate the equipment you use in your businesswhether it be physical tools or software.
Also, communicate with your employees for feedback. Its possible that some need more training or can even offer better alternatives.
Poor Working Conditions- Bad working conditions can cause employees to be less productive. If employees are uncomfortable, they are more likely to spend time distracted and thinking about how uncomfortable they are rather than focusing on their work.
Be sure to control workspace conditions such as temperatures and lighting. Also, help employees feel mentally comfortable at work by encouraging an environment that prioritizes psychological safety.
Lack of Direction- Sometimes employees are unproductive because they dont know what they should be doing. If this is the case, they are likely to either do nothing or do the wrong thingboth resulting in unfavorable outcomes.
When you hire new staff, provide adequate and thorough training.
Detailed direction from good managers and supervisors will lead to your companys success, as well as your employees success.
Also, consider setting workplace goals and incentives to keep employees motivated and striving to improve.
Too Many Distractions- Distractions come in many forms but yield the same outcome- distractions decrease productivity.
Talking to other employees and spending time browsing the internet on smartphones are major productivity killers. You should also consider the effects of unnecessary work that doesnt push people towards their goals. Do you really need to have that extra meeting, or will it simply distract people from their jobs?
Lack of Appreciation- If employees feel like their work isnt appreciated, they wont be as motivated to work as similarly skilled employees that feel needed. Praising employees for their work can help with this, as can ensuring they are compensated fairly.
Low Intrinsic Motivation- Even if you take care of all the above, employees will sometimes still lack intrinsic motivation. If they do, they will care less about their job which will ultimately lead to them be less productive than they should be.
Putting in place better hiring processes to ensure you only take on highly motivated people or having a way to show employees that their work matters are key challenges for battling low intrinsic motivation.
How to Measure Productivity
The two main ways to measure employee productivity are measuring the overall productivity of your organization based on its revenue in relation to the number of hours worked, and measuring how individual employees or teams perform in relation to the tasks they are hired to complete.
Overall Labor Productivity
Labor productivity measures the revenue a company brings in per hour worked by its employees. It is good for measuring the overall productivity of a company.
To calculate your organizations labor productivity, divide the total revenue brought in over a period by the total number of hours worked during this time.
Imagine a restaurant that brings in $15,000 in total sales in a week. To work out the restaurants labor productivity for that week the manager would have to divide $15,000 by the total number of hours worked by all staff members.
If the restaurant has 10 employees, each working eight hours per day for seven days, the total number of hours worked is 560. Dividing $15,000 by 560 means labor productivity is $26.79for every hour worked, the company brings in $26.79 in revenue.
This issue with this number is that it doesnt tell you anything about the performance of individual employees or teams. Some staff members may be more productive and bring in more than $26.79 in sales, while others may bring in far less.
Nonetheless, it is a good starting point for calculating the productivity of your workforce.
Productivity by Tasks
Another way to measure productivity is to base it on the number of tasks your team completes per hour or shift. In a restaurant, this could be customers served, for a cleaner it could be rooms cleaned, or for a salesperson calls made.
If you choose to measure productivity based on tasks you should look at how your most productive employees work and set benchmarks for other employees to hit. It may also be possible to research industry standards and use these guidelines to set goals.
You should ensure that the tasks are actually pushing people towards your organizations goals. For example, a salesperson with a target of making 100 calls will strive to hit that number. However, if there are only 60 good leads, the same person may be better spending their time on another activity after they have made 60 calls.
There may also be outside factors that affect how well you can measure productivity per task. If your restaurant is quieter than normal one day it may be impossible for employees to hit your benchmarks even if they are working at a high level.
Why Productivity Matters & Strategies on How to Improve It
Productivity matters quite simply because unproductive businesses spend more for the same output than productive ones. How you choose to use these savings is up to you. Here are some options-
Cut Costs- If you currently require 100 hours to complete a task, increasing productivity by 10 percent means you will only require 90 hours to complete the same task. This will save you the cost of the ten hours.
Increase Profitability- Alternatively, you could use the extra ten hours to create more of the required output. This means you are creating more for the same labor expenditure.
Spend Less Time Working- If you can get the same work done in a shorter amount of time employees can spend less time working. This may improve their overall happiness and enjoyment of their work.
In a restaurant, being more productive could lead to the better end of shift processes which allow workers to get home quicker after a shift than they were doing previously.
Strategies for Improvement
To improve productivity, you need to first define what is holding your team back. Look at the section on productivity challenges above to see if any of those options ring true at your business. You can then begin to put in place measures to address these issues.
Better Processes and Training- The first thing you can do to increase productivity is to ensure that everyone who works at your businesses knows what they are doing and how to do it.
Putting in place effective processes to guide employees in optimal working practices and then training these employees about how to navigate said procedures is essential to having high employee productivity.
Also, be sure to train supervisors and middle management about the most effective ways to work, manage, and motivate their team.
Set Goals- Setting goals can be an effective way to increase employee productivity. Employees that know what they should do every time they enter the workplace are more likely to reach their goals. When setting targets, make them achievable and ensure employees who hit these metrics are praised or rewarded.
Remove Distractions- Distractions are a major productivity killeryou should do what you can to remove them from the workplace. Ask shift supervisors or even your employees if they feel like anything is stopping them from getting work done.
Remember, distractions can be both outside forces like phones or social media, as well as company policies like meetings, unnecessary paperwork, or presentations that stop people from focusing on their main job.
Use the Right Tools- The final tip is to ensure that employees have everything they need to succeed. Tools, whether the physical equipment workers need to do their job or software packages that enable them to do their job more effectively, will help ensure everyone is working at maximum productivity.
Increasing employee productivity has many business benefits. You can cut costs, increase revenue, and achieve more of your goals. Employees will also benefit if you are providing better training, improving the working environment, and showing appreciation for their work. Ultimately, working better and faster means youll end up with more happy customers.