How to Measure Employee Productivity

February 14, 2017 Jessica Ure No Comments

“If you can measure it, you can improve it.”

No doubt about it, these are wise words from Peter Drucker, a self-described ‘social ecologist’ who’s widely regarded as the ‘Godfather’ of modern business management.

What’s he on about? Basically, he muses that the key to improving productivity is empowering decision makers with performance insight. This strategy can be applied to any business model, from retail and hospitality to accounting and litigation.

So how do your staff measure up? Read on for our guide on how to calculate employee productivity, and how results can be used to improve performance.

How to Calculate Productivity

Set benchmark standards

Empower your business with facts and figures by setting benchmarks that can be used to measure employee performance.

Start by pinpointing your daily business output, then dividing this by the number of employees that contribute to the process. These are known as targets or KPIs, and can be used to determine whether or not employees are meeting requirements, and how they shape up against their colleagues.

Results can then be used to reward high achievers, roll out targeted training and motivate employees to improve their performance.

Track each individual employee

As well as assessing overall team performance, it’s also important to track each employee individually. Patterns can then be used to hone in on weak points, and boost both the productivity of both individual employees, as well as the business as a whole.

Look at the big picture

It’s important to appreciate that employee productivity is an ongoing performance indicator. Even stellar workers have off weeks, which means that in order to gauge an accurate idea of productivity ongoing assessment is essential.

Weekly performance reviews are great, but don’t forget to paint a bigger picture by using monthly, six-monthly and yearly data.

Measure engagement

Employee engagement is a key contributor to productivity. When engagement drops, productivity spirals as a result – it’s as simple as that. With the latest stats from Gallup revealing that 63% of US workers are not engaged and a further 24% are actively disengaged, the importance of making employees tick has never been so pressing.

Oh, and did we mention the estimated annual cost of US$450-$550 billion that disengaged workers cost? So how can you fight a seemingly endless battle with smartphones, social media, emails and personal lives?

CIO has some great tips on how to measure and improve employee engagement, including critical metrics like setting goals, providing feedback, empowering employees and incorporating elements of gamification.

Keep tabs on employee attendance

It might seem obvious, but in order to be productive, employees actually have to show up to their shifts. If a member of staff consistently turns up late, clocks off early or simply misses shifts altogether, it could be a tell-tale sign of underperformance.

Keep tabs on employee attendance by investing in purpose built modern workforce management software like Ento that captures clock-on and off times right down to the minute.

Source employee feedback

There’s an intrinsic relationship between motivation and productivity, so do everything you can to source insight into whether or not your employees are inspired. If morale is low, it could be a tell-tale sign that productivity isn’t at its peak. Counteract indifference by creating a company culture that makes every employee feel valued, takes feedback into account and rewards high performance.

Tracking performance isn’t always black and white. But with the right strategy in place, how to measure productivity and use results to augment the performance of your workforce will quickly become second nature.

Measure employee productivity with Ento’s time and attendance software today or learn more about workforce management on the Ento blog.

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