When we start a discussion on employee productivity, most of our conversations revolve around the number of working hours, where they work from, etc.
If you assume an employee works 40 hours a week, they give your company 2000 hours a year. But, when it comes to real workforce productivity, the number gets tricky.
Most studies revealed that employees are only productive for 60% of their work time and are more productive while working from home. But why is employee productivity important for your business, and how can you improve that? This article will share answers to all these questions.
What is Employee Productivity?
Employee productivity measures employees’ efficiency and effectiveness in completing tasks and achieving goals within a given timeframe. Usually, good employee productivity is nearly 70%, and companies can target 70-75% workforce productivity.
We can use a formula to calculate employees’ productivity in your business.
Employee productivity = Total output/total input
For example, if your company generated USD 60,000 by selling goods in 1500 hours. Then, your employees’ productivity is (USD 60,000/1500) USD 40 per hour of work.
Now, you generated USD 60,000 with 30 employees, so your per-employee productivity is (USD 60,000/30) USD 2000 per employee a week.
To summarise, workforce productivity is related to individuals and their achievements. But, as we check at a more granular level, it refers to a company’s health and ability to grow and thrive.
What is the Importance of Employee Productivity in Business?
You must wonder how employee productivity is connected with your business. But let us tell you when your ground-level workers’ productivity improves; your business moves a few steps toward success.
Every company looks for ways to reduce the productivity gap created by technological advancements to scale. However, only a few companies have considered closing staff productivity gaps essential for a business to thrive.
When your employees are more productive, your organisations can scale and meet their goals more efficiently. Additionally, employee productivity helps businesses meet consumer demands, become more profitable, and remain competitive.
What Factors Affect Employee Productivity in Companies?
There are a handful of factors that can affect employee engagement and productivity. However, one common reason for low employee productivity is management.
Research says nearly 35% of employees say their boss stresses them out, especially by micromanaging them. This has resulted in distractions and being less productive at work. On the other hand, it was found that when the manager backed their employees and trusted them, staff productivity level increased massively. It also resulted in finishing projects ahead of time.
We have listed some other reasons that may affect employee productivity in the workplace.
Employee Health and Wellbeing
Your employees are not isolated beings; their personal life can impact their professional lives. We all suffer from stress and mental health issues, affecting our professional performance.
Others can have financial and relationship issues or physical health problems. Altogether, these factors can affect an employee’s productivity at work.
Productivity gets hampered if your company’s work environment is always noisy, has extreme temperature settings, unnatural lighting, or unavailability of proper workstations. However, this problem is more evident with remote workers who may not have a professional setup like your office at home.
It plays a significant role in shaping employees’ productivity. While a positive culture increases productivity and employee retention, a toxic culture can result in low morale, high turnover, and reduced productivity.
If you aren’t focusing on providing employees with a healthy work-life balance, the chances of burnout and low productivity increase.
Facilities and Equipment
Employees’ productivity decreases if they use less effective tools and outdated technologies. Therefore, you must invest in reliable, intuitive, and fast technologies to improve employee productivity.
How to Improve Employee Productivity in your Company?
Businesses need to look for numerous ways to improve productivity in the workplace. We have listed the top ways that can do wonders to make your employees productive while also keeping them happy.
Improve your Communication with Employees
You must encourage two-way communication in your company. It allows your employees to speak about their problems and feel heard. Proper communication can help you solve misconceptions and misunderstandings that lead to low productivity.
Omit Unnecessary Meetings
According to a study, employees spend many hours every month on unproductive meetings. Instead, you can switch to emails to send information to your employees. However, if you’re arranging meetings, make sure they’re for effective reasons and mainly cover essential points.
Stop Micromanaging Staff
Most recruiters believe micromanaging can increase productivity, but the opposite is true. Employee empowerment in the workplace can only exist if the management trusts its employees and gives them the freedom to control their tasks at work.
Hire People and Not Just Their Resumes
During an interview, a recruiter usually follows an outdated and traditional hiring process to assess candidates’ skills, job experience, and education. However, this is not sufficient for a productive workplace. You must consider hiring the right culture-fit talent whose ethics, behaviour, and beliefs align with your organisation.
Train and Develop Employees
In a survey, we found companies investing in employee training and development have more engagement and productivity. Well-trained employees become experts in their domain, leading to better performance and higher productivity.
On the other hand, if your employees are largely dependent on outdated technologies and strategies, your overall business productivity will be hampered.
Allow Flexibility in Working
Remote and hybrid working practices are the top trends in the market after the pandemic. Workers have reported to have higher productivity while working from home. Therefore, companies need to allow such alternative work structures.
Additionally, you must also remember that every worker may not have the same productivity during a fixed period. So don’t stick to a strict 9 to 5 schedule; try to offer them flexible work timings and improve productivity.
Recruiters sometimes neglect praising employees who made critical outcomes and fulfilled business goals. This demoralises workers, eventually affecting their productivity.
Henceforth, you must invest in opportunities to compliment your employees on their achievements. This will help them feel motivated and appreciated, urging them to do better in future tasks.
Ask For Feedback
You must ask for employee feedback from time to time to understand what’s affecting productivity levels. For this purpose, you can create an employee-friendly environment to share their thoughts without fear of judgment.
Furthermore, you must act on your insights from their feedback to ensure you value employees.
How can 6 Pence Help?
In conclusion, employee productivity for any business is essential for its success. If you want to achieve high levels of productivity in the workplace, you must pay equal attention to what is beneficial for your organisation and your employees. Remember, happier employees are productive employees.
If you are looking for top talents to join your business and take it to new heights, then consider 6 Pence for all your staffing and recruitment needs. We have offices in Bahrain, Oman, Iraq, and Dubai. We assist our business partners in hiring the best-fit employees for their open positions. This leads to increased employee productivity and retention.
Frequently Asked Questions
How do you measure employee productivity?
You can measure an employee’s productivity by comparing the amount of work done to the time taken to complete it. For example, if you have to complete a writing that usually takes 3 hours, but an employee completes it in 2 hours, then their productivity is better than expected. It means if you have to increase productivity, you must finish your work ahead of time or do more work within that time.
What is an example of staff productivity?
Let us assume 30 employees are generating USD 90,000 in revenue in a week. So, using a formula, staff productivity= total output/total input, we get each employee’s productivity as (USD 90,000/30) USD 3000 a week.
What are the four types of productivity?
The four types of productivity include employee productivity, material productivity, capital productivity, and total productivity.