A small business, with a small employee roster, succeeds only if each member of the team is highly productive. At a large company, one out of 100 employees turning in a substandard performance may not noticeably impact the company’s bottom line. If only one out of five employees -10% of your total workforce isn’t working productively, it can be a heavy drag on the overall profitability of your business. That’s why it’s important to track employee productivity. Only tracking hours worked fails to provide a real assessment of performance. Even actual production measurements, such as number of units produced or sales made, may still fall short. For example, one employee may make five sales a day, while another employee makes only two but for significantly higher dollar amounts. Consider these performance measurements for truly significant and helpful assessments of employee productivity.
Choosing Performance Assessment Standards
The best performance measurement or evaluation method varies from business to business, and even between different departments within the same business. For example, employee performance of manufacturing line workers might be measured by the average number of flawless products produced, while sales staff might be evaluated by the total gross profit of orders solicited. To choose the best ways to measure employee productivity, consider the specific goals and driving factors of your particular business. Once you clearly determine, say, whether your business’s main focus is increasing profit margins or making headway into new markets, then you can identify what employee behaviours most contribute to achieving your company goals. Employees find it easier to be most productive when they understand a company’s current focus, since that helps them know which of their activities should take priority.
Performance by Goals
Some businesses find that transitioning employees from hourly to salary status with a clear emphasis on completing projects or achieving defined goals makes it easier to distinguish superior employee performance and often leads to increased productivity. This method of performance measurement works well when your small business is new or rapidly growing. it’s important to set and achieve growth-related goals in a timely fashion.
Co-Worker Feedback Assessment
One innovative way to assess productivity is through feedback from fellow workers. This productivity metric works well in companies where various departments may not have a high level of interaction, but where there are high levels of interaction among employees within departments. The strength of this method is that co-workers within a specific department are best equipped to evaluate a fellow employee’s performance because they know what relatively good or bad performance realistically looks like within that specific work context. Intra-departmental evaluations generally give employees a feeling of greater independence, which often helps unlock employee creativity that improves operational efficiency.
Software to Grade Productivity
One option for measuring productivity is using software programs designed for that purpose. Tools such as WorkiQ track and measure employee activity on their computers, producing easy-to-read visual reports on the amount of time employees spend using productive versus nonproductive applications. Other employee performance software programs include I Done This, SnapEngage, and Pipedrive, which evaluates sales staff performance. While time tracking may still be necessary for some positions, such as a receptionist, since it’s important to have your front office staffed at all times, a little thought and research into available performance evaluation tools can help you implement significantly more helpful employee productivity metrics.