Five Ways to Best Measure Productivity at Your Office
Today, it is almost impossible to read an article about the workplace without hearing the word
"productivity." It has become a buzzword for those who want to improve outcomes and employee morale.
However, one can plan to incorporate this concept in their office without receiving its benefits.
The only way emerging trends like productivity, work-life balance, innovation, and efficiency truly
work is if we can measure their effectiveness.
The phrase, "you can only improve what you can measure," has been attributed to many entrepreneurs
and business leaders. Nevertheless, it is true. You can only develop strategies to enhance productivity
if you know where you are starting. This scenario produces a new question, how do you measure
productivity? Productivity is made up of a variety of different indicators.
Here are a few stats that reveal some productivity indicators:
Organizations with higher employee engagement see
Employees who exercise their strengths daily are
more productive, and six times more likely to be engaged.
Organizations with a strong onboarding process improve productivity by
These statistics are indicating that productivity is less about output, dollars, and cents, and more about
the company itself. Ultimately, productivity is about the people you hire and how you motivate them. As a
result, it is crucial to measure things like engagement, individual employee performance, and metrics related
to employee hiring. So, to begin to effectively see the outcomes at your company, here are the five best ways
to measure productivity at your office.
Again, productivity is intertwined with employee engagement. One of the ways to determine if employees
are engaged is to track their satisfaction. An excellent method for measuring employee satisfaction is
through things like pulse surveys and or one-on-one discussions. Both can yield useful quantitative and
qualitative data. For pulse surveys, you can ask about factors related to their satisfaction and invite
employees to use a Likert scale. On the other hand, you can receive real-time feedback from employees
about their work environment, interactions with managers, and workload with a sit-down conversation.
Another practical way to measure employee satisfaction is the Net Promoter Score (NPS). This metric
allows employees to rank how likely they are to recommend this company to someone interested in working
there. The higher the score, the higher the engagement, which should also lead to higher productivity.
Whenever productivity is part of the conversation, goals have to be a priority. From the moment, an
employee begins working at your company, you should be working with them to develop short-term and
long-term goals that align with your company's overarching objectives. For example, let's say that
you have hired a digital marketing specialist. The overarching goal that you have is to increase
sales by 10 percent in the next six months.
An individual goal for them to attain would be to increase page visits to an e-commerce site that
ultimately lead to sales. Their conversion rate is what you are after. This example is one that
shows how individual performance can impact an overarching company goal. Ultimately, you need to
determine if the efforts of your staff, allow you to meet your company goals within a specified
period. If not, then it is time to reevaluate the efforts of your team or adjust the goals.
Much of the productivity metrics process is about the individual. Nevertheless, it is crucial to
understand how your team works together as a whole. You need to find out if your company is
productive. One of the best ways to measure this is to know how your company compares to the
industry. When it comes to output and outcomes, how is your competition fairing? Look at the
industry averages regarding market share, sales, production, and even customer satisfaction
and experience. Is your team meeting or exceeding these numbers? If not, why? Your goal is to
see how you stack up and develop ways to improve or maintain your standing.
Every company is indeed unique (even if you have similar competitors). You may have specific
limitations that do not apply to them and vice versa. However, to genuinely know if you are
on the right path, you need an idea of how the industry is fairing as well as how you compare.
You may be knocking each measure out of the park, or you may excel at some over others.
Ultimately, the purpose is to find where your strengths and weaknesses are in regard to your
industry and develop the necessary strategies to stack up.
Employee Turnover and Retention
This one may seem unrelated to productivity as explicit output versus input numbers are not
measured. Nevertheless, this metric can unveil the reasons why you are meeting—or not
achieving—your goals. The official calculation for
is employees who have left your company divided by the average number of employees. This number
is then multiplied by 100 to give you a percentage. Some will take the starting and end amounts
of employees from quarterly or even monthly periods. Obviously, the lower the number, the better
for your company.
While it is common for employees to leave a company for a variety of reasons, too many turnovers
can negatively impact productivity. Each time an employee leaves, you have to:
Handle the loss of information and knowledge.
Take time away from business dealings to manage the hiring process.Those with access can
easily find what they need, regardless of whether they are in or out of the office.
Divide the work amongst current employees until a replacement is found.
Divide the work amongst current employees until a replacement is found.
The loss of an employee is a disruption to your business and is an automatic loss of productivity.
So, if turnover is high, your productivity numbers are taking a hit in the short and long-term.
As a result, employee turnover is an excellent way to measure productivity and ensure that your
team has a higher chance of being productive. As time goes on, you should also be measuring retention
within one to three months of onboarding, and even after one to two years. Both will give you an
indication as to whether your employees are engaged and satisfied enough to stay.
Profit Vs. Salary Measurement
While you want to have employees who are satisfied and engaged, you also want them to help you
bring in a profit. Ultimately, those "soft metrics" should lead to increases in the standard
productivity measurements like profit. The profit versus salary metric reveals the gross gain
the company earns for every dollar spent on salaries. This measurement and indicator of
productivity enable you not only to see if your company is profitable but also if the money
you are spending on wages is a factor in profitability.
It is an excellent way to measure the effectiveness of salary increases like raises and bonuses
while also not punishing employees for the time needed to innovate or develop creative ideas.
Some may prefer this metric then utilizing time (which comes with a variety of limitations).
You Can Efficiently Measure Productivity at Your Office
Measuring productivity doesn't have to be a complicated process. You can keep a consistent
pulse on your company. The mistake that many business owners make is that they think productivity
is merely about outputs and outcomes. Outputs are a part of the equation; however, they should
not be the only metric.
Understanding the best way to measure productivity is knowing that it is more profound than
production. It is about employees and the teams that they are a part of. Are your workers
motivated? Are they satisfied with the work environment? How high is employee turnover? Is
investing more money in their salaries leading to higher profit? These are all questions the
metrics above can help you answer. Your goal is to remember that productivity isn't just some
broad term for getting work done. It is all about efficiency, motivation, and ensuring your
employees are producing high-quality work with high levels of satisfaction.
How are you currently handling productivity? Do you measure any indicators? Are your metrics
telling you all you need to know? If not, think about incorporating some of the measurements
above. They can give you insight into factors that are helping to improve—or diminish—your
Take the time to find what works for your company as each business structure, profit model,
and business strategy is unique. If you do this and take measuring productivity seriously,
you will be able to seamlessly track your company's performance and create the plans necessary
to enhance it.
Employee Productivity Statistics: Everything You Need to Know For 2019,
How to Calculate Employee Turnover Rate,
The True Cost of a Bad Hire,