Tips for making productivity metrics work for your business goals

24 of February, 2021

Your business goals need to be met in an efficient and effective manner. Your employees’ morale, productivity, and their ability to deliver is vital for the success of your company. Productivity metrics allow you to to have a quantitative measure of an employee’s productivity.

Your productivity metrics need to be defined according to what the output of your business is. Your business needs to determine how you measure productivity metrics by discussing what is your output. It also helps to know the factors influencing productivity.

Why do you need productivity metrics?

Quite simply, because your employees need feedback on how well they are doing. Breaking down your projects into smaller tasks and seeing where blockages occur is important. Managers are increasingly looking for ways to increase productivity.

Furthermore, employees want to see what results they are producing. This gives them motivation and a sense of completion.

How do you measure productivity metrics?

To calculate the productivity of an employee, you must take into account two factors : the output an employee produces and time.

Output is dependent on the business you are running. This can be :

• the sales a salesman has completed
• the amount of articles a journalist had written
• the amount of products your workers in a factory have produced

there are numerous metrics to measure productivity that are applicable. The important thing is that you

Calculating productivity over time

Having determined your output, you must now calculate it over a period of time. Measuring output over time is an important part of making productivity metrics work for your business. This can be done with the following steps :

• Take the amount of output you are measuring.
• Consider the amount of time over which you wish to analyse the productivity of your company.
• Divide the output over the time it takes.

What are the issues with productivity metrics to work for your business

Productivity is a controversial measure of effectiveness. Just because your employees are producing more units of something, doesn’t mean you are efficient. Nor does it make your business successful.

You need to include factors such as :

• The costs you factor in to producing your output.
• your efficiency or effectiveness ratio, which calculates the amount of money per time unit rather than overall output.
• The retention rate of customers or clients linked to your project.

Other measure of effectiveness

Productivity is not the be all and end all of of a business. Your strategy might revolve around the market share your product has, which means customer satisfaction comes into play. Creativity is also extremely hard to measure. Sometimes an employee may put less hours in and produce less, but find a silver bullet to kickstart your company.

Determine what your business goals are to make sure your are measuring the right metrics for success in your business.