Why Boosting Employees’ Productivity Matters More than Ever for Every Organization

The easiest part of any business is getting started; the hardest is sustaining it. Making it profitable is the most challenging.

Globally, 20 to 40 percent of new businesses are estimated to fail within the first five years; for some countries, the rate is over 50 percent, while some experts estimate it to be 90 percent.

In most discussions about company survival and profitability, a lot of attention is being paid to factors such as market research, financing, marketing, and recruitment.

Employee productivity is often ignored, even though it is as important as other pillars of any business strategy. Unproductive workers cost businesses around the world $8.8 trillion, equivalent to 9 percent of global GDP.

Meanwhile, productivity can be improved by something as easy as appreciating your staff with Employee Awards. 

What is so important about employee productivity?

Different reports have indicated that in all career fields, a typical employee is only productive for 60 percent of the day, sometimes less.

With ever-changing trade policies and financial stress, businesses across the world are not having it all easy. To survive, businesses typically try to become more prudent in their spending and increase the price of their product or services.

Meanwhile, leveraging and optimizing the capabilities of your workforce can significantly reduce your cost of production, improve your customer service experience, and increase profit.

More than ever, businesses need to pay more attention to employee productivity. It is essential not only for your business to thrive but also to remain competitive in today’s ever-changing business landscape.

Productivity vs. production vs. profitability

Productivity should not be mixed up with production. Production is simply creating goods or services from purchased components into a finished product or sellable item.

Productivity, on the other hand, is a measure of efficiency, calculated as output per unit of input. If a business can produce more products with the same amount of labor, capital, technology, and materials, its productivity has increased.

The efficient use of available resources is a sign of good productivity and can increase profit.

Profitability, in simple terms, refers to the profit-ability of a company. While you can increase your production by increasing the number of resources deployed, you can only record remarkable profitability if you improve your productivity.

Measuring productivity

There are different metrics to measure productivity depending on your organization’s goals. Appropriate measurement of productivity is essential in the journey of improvement.

The two major components of productivity are output and input. A productive team will produce more output with less input.

Do not adopt a productivity metric without assessing how it perfectly fits your business modus operandi. If not, you will end up frustrated and confused.

A productivity index should not be solely focused on how far you can reduce input and increase output. Instead, your productivity metric should help identify how to get more output per unit of your expended resources.

Output-based metric

This metric focuses more on the total quantity of goods or services produced or the total income earned from output sales.

If you employ this metric, an increase in the number of products produced or services rendered will indicate improved productivity. 

Input-based metric

The input-based measurement considers resources and effort expended by employees, including labor, capital, and material.

Efficiency measurement

The higher the output-to-input ratio, the better your team's productivity. To calculate productivity, you divide the average output per period considered by the expenses or resources, such as labor, consumed during that period.

You can boost your employees’ productivity

Two factors affect productivity ― human factors and technological factors. Human factors include your employees’ willingness and ability to work, while technological factors include plant capacity, quality control, and timely material supply.

Optimizing these two factors will help you boost your employees’ productivity.

Emphasize appreciative company culture

Your employees are your most valuable assets. Make them feel valued and appreciated if you want them to become more invested in the company’s success.

Encourage teamwork and collaboration. Acknowledge their achievements in the most honest, authentic, and personalized way possible. This can be a low-cost endeavor, like presenting them with employee awards like Most Creative Awards and Attendance Awards.

The best business managers and leaders emphasize a recognition-rich environment for their employees. According to a Gallup study, employees who receive great recognition are 20 times more likely to be engaged with their company.

Companies with a high level of employee engagement are more likely to record a 22 percent increase in their productivity compared to competitors.

Optimize workload

An employee’s productivity is relative to the volume of tasks assigned. Assigning an employee too few tasks can result in boredom and lack of motivation, while high workloads can put a strain on their mental health and invariably lead to burnout.

Engage your employees to understand their strengths and weaknesses and to assign them tasks they can handle efficiently. If possible, offer flexible work hours to help them achieve a work-life balance.

For instance, offering your employees a work schedule that allows them enough time for physical exercise can help boost productivity.

Upgrade obsolete technology

Technology can make your employees' jobs easier and less efficient if not properly deployed.

Just as the business world keeps evolving, technology is also updated to catch up. Using an obsolete technology will reduce the productivity of your team.

Upgrade where needed and change entirely if the present option is ineffective. Before deciding, discuss with your staff how they use the technology to determine the best technology for them.

Encourage open communication

Clearly communicate company goals and expectations to employees. Set deadlines that are achievable but challenging and encourage open communication whereby employees can actively communicate their ideas and concerns.

This approach helps in increasing employee productivity as it makes employees feel directly connected to the company’s mission and goals.

Also, promote autonomy by allowing employees to make decisions and solve problems independently.