The Best Ways of Measuring Productivity

If you’re a business owner or team leader and thought about ways that can help measure employee productivity, you aren’t alone in this. Many have done so. 

While the Human Resources department is usually the one responsible for measuring productivity, everyone in management has surely contemplated it at least once. What is important to keep in mind, is that any level of the employees’ performance that isn’t measured can’t be improved. The issue is that sometimes it’s quite difficult to measure because of different business structures, variations in the workflow and even different working environments.

Why Does Measuring Productivity Matter?

Being able to measure employees’ performance will help your business be more profitable, reliable and trustworthy - all while constantly looking for ways that you can do better. If you never measure productivity, any mishaps that could have been avoided could result in dissatisfied clients and customers. 

Because situations like these could do some serious damage to a business, it’s important to be able to measure your employees’ productivity and tackle any potential problems at the root.  

In this post, we’re giving you a 3+7 combo. 3 methods to measure productivity and 7 ways to implement them. 

Let’s look at the first method.

Method 1: Management by Objectives

The Management by Objectives method focuses on specific goals and targets. To get the most out of this method, businesses need to provide a detailed action plan which has very specific tasks. Each team or employee will have a set of objectives that they need to meet, and the objectives are broken down to their corresponding parts. 

Afterward, their productivity is measured based on their output results - namely how fast they finished the task and the quality of the end product or result. 

If you choose to use this method, take into account these points:

• After you set your objectives, think about ways that you can enhance your employees’ workflow so that their productivity is higher.

• Team leaders, managers and supervisors need to be able to provide support and solutions to any potential problems that may arise.

• To successfully measure the progress of your objectives, regular evaluation is crucial.

Method 2: Measuring Quantitative Productivity

The second method for measuring productivity is by focusing on the number of services or products that your employees can process within a given time frame. It is a pretty straightforward technique that many businesses use. 

For this method to be the most effective, however, businesses need to consider all factors that contribute to the flow and disruption of this process. Examples include the time needed to train employees, malfunctioning or broken tools, the time required to fix them and even lunch breaks.

Companies also use productivity software that can calculate the average productive day of an employee. Sometimes it can even be boiled down to how productive they are in an hour. After all, the best form of data is that which can be measured.

Method 3: Measuring Productivity by Profit

Another form of measuring productivity that is quite popular is by measuring profit. This is usually a method used by small to medium-sized businesses since it is an easy way to measure productivity. 

Why is it easier? Well, for one it’s much less work to track profit than track every single employee. If your employees are more productive, that means that your profit will increase. If not, then the profit will drop. It really is that simple. 

If your revenue has been stagnant for some time, then it might be a good time to see what techniques you can implement to help your employees become more productive. 

And that’s a great way to slide into our next part of the post: 

8 Ways to help you implement productivity measuring methods

Now that we’ve gone through 3 of the best methods to measure productivity in the workplace, let’s look at some tips to help you implement them.

1. Start with the base

The first thing you should do before you start to track time and profits is to set some ground rules. Each team gets a select number of objectives, and if you’re really savvy assign each employee specific tasks.  Set a standard for every week, month or quarter and let your employees do the magic. They will know exactly what they need to do.

2. Outline and Measure Tasks

Another thing businesses can do to measure their employees’ productivity is to provide a clear outline of what needs to be done and how it will be measured. For example, how many calls can be made in one day, how much time each client spends on the phone, and how many successful sales can be made in a day. Look at the least an employee can accomplish in a day and set that as a standard.

3. Carry Out a Client Survey

What will help your business a lot in its productivity-measuring journey is actually talking to your clients. They are, after all, one of the most transparent results of productivity. With client surveys, you can pin down both good and bad employee performance. You will know what is working well and what needs to be improved. 

4. Take into Account Company Culture

With company culture, we mean the business’s ethical or moral values, how employees are treated, how clients are treated and the working environment. All of these things directly influence your company’s productivity levels. So if you see that productivity is a little low these days, consider taking a look at the company culture to see if there is something that is triggering this decrease. 

5. Track Individual Progress

To assist the productivity measuring within your whole company, you can also track individual employees and their progress. This is also quite helpful for companies that have a lot of employees. In large-scale companies, teams need to have equally productive members - or at least members that can bounce off of each other. If one person does all the work and one person slacks off, then the whole team’s progress will eventually decrease. You will end up losing an employee that didn’t work as much, and as well as the employee who worked way too hard that experienced burnout.  

6. Ask for Daily Updates

Another way that can help you measure productivity is to ask your employees or teams to provide an update at the end of the day of what they were able to accomplish. This helps keep track of work done, work yet to be done, how fast progress is being made, and any problems that may have occurred during the day. It also helps to keep your employees more accountable for their work and motivated to keep ticking off those goals. 

7. Don’t forget about the Human Factor

As a last tip, we strongly recommend to always keep in mind the “Human Factor”. Some employees are just naturally slower with completing tasks, some are faster, some prioritize speed over quality, some procrastinate, and so on. These are things that can influence the way you measure productivity within your business. Since each employee brings uniqueness to the workplace, it’s important to acknowledge that and try to tailor any productivity measuring method to their needs as well. 

Whichever approach to measuring productivity that you choose, remember that there are many tools that can help you. With the constant technological advancements and new software being developed every day, there are advanced ways that you can utilize technology to organize, manage and profit your business.

Since employees play a very important role in your business’s growth and success, their productivity is crucial to both you and them. 

So start implementing any of the above strategies and watch your company thrive.