Productivity: The Ultimate Guide to Understanding Productivity
When you hear the term productive, perhaps you visualize an individual who is always busy. A person who constantly moves through tasks pushes deadlines and appears trapped under multiple duties. But what does productive mean? Being productive refers to having the power to produce in abundance.
According to a Gallup Survey, 70% of US employees are disengaged from their workday. Most employees find it difficult to focus consistently and give their best due to distractions by social media, personal emails, and personal matters. For this reason, any business, regardless of the products or services it offers, needs to measure productivity to ensure its employees are living up to their full potential. But what is productivity, and how do you quantify it?
This article provides comprehensive information to help understand productivity.
What is productivity?
Productivity refers to how efficient and effective an organization converts inputs such as labor, capital, and materials into goods or services. It means achieving more in less time and generating higher revenue with fewer resources. Therefore, measuring productivity is essential for businesses to help them know whether they are meeting targets and identify where they are falling short.
Besides, measuring productivity helps with scheduling projects as it gives a better idea of the time a particular task will take by reviewing previous performance. Finally, the productivity metrics help determine whether everyone in the team is pulling their weight.
Productivity types within organizations
There are four types of productivity within an organization, with each affecting a different part of the supply chain.
- Capital productivity: Tells the ratio of services or products to physical capital you need to produce them.
- Material productivity: Refers to the ratio of services or products to natural resources. This type is more useful in industries that require more natural resources in producing goods.
- Labor productivity: Tells whether the organization is efficiently converting labor into service or products.
- Total factor productivity: Entails everything else, including management tactics and knowledge and skills that other types of productivity leave out.
Different ways of measuring productivity
1. Quantitative method
The quantitative method refers to measuring productivity based on the number of products an employee produces in a specific period. Productivity is quick to calculate on a spreadsheet or with productivity software that reveals the number of products a worker produces in the given period. After that, an average reveals the productivity gains or losses over time.
2. 360-Degree feedback
This method involves collecting comments and feedback from co-workers and using them to determine productivity. However, it only works if employees in a company interact with each other. Evaluators must know the daily work duties, overall functions, and professional credentials of their co-workers. Therefore, the method works best in departments or small companies where employees know and interact with each other.
3. Sales representative's productivity
Measuring a sales rep's productivity requires you to record multiple aspects within a specific period. These include the total sales and sales amount in that period, calls made to current customers, new customers acquired, calls to potential new customers, and expenses per sale. Members of the sales team should record these numbers on a spreadsheet or using software tools. Before evaluating the numbers, you should first establish the baseline for sale productivity level that fits your specific business size.
4. Time management productivity
This method determines employee productivity based on how they spend their work time. The measurement reveals the amount of time spent performing work duties in a timely manner and the time lost due to excess time off, illness, distractions, and non-work-related conversations.
Conclusion
Measuring the productivity of your business is critical since it allows you to make operational adjustments and add employees or equipment to achieve your goals. Additionally, it helps your efficiency levels allowing you to take in new clients.
MindManager understands the importance of efficiency and effectiveness in a business. For this reason, we offer tools that help exploit the power of visualization to boost your productivity. Try a free MindManager trial today!