• How-to

As an entrepreneur, your employees’ productivity is directly proportional to your company’s profits. Measuring and tracking the productivity at your organization is in the interest of your business’s health. It will also give you a clear indication of who is achieving desired results and how many employees are still at the starting line. Remember, old-school approaches of measuring the number of hours an employee spends at office are not effective; instead, the key is to let productivity be your employees’ personal goal as well.

Measure the macro
At a macro level, most employers measure the firm’s revenue (profits may be a better measure) and divide it by the number of employees on an on-going basis, say quarter-on-quarter, to understand profit per employee. This should give you a macro indication of productivity, in case you are of the opinion that you need to add or remove people.

Measure the metrics
Every organization broadly has five-six metrics tied to its overall revenue and business model. Each department, in turn, would have different metrics per objective, depending on the nature of work therein, tied to the overall metrics of the organization. Once you’ve identified these, you need to build and set up the tools and processes required to monitor the same. What counts is the result generated per objective, not the number of hours your employee has spent. However, the key here is to identify the single largest metric for each objective rather than an unending list. It could be related either to time, output or customer satisfaction. Experienced managers say anything is quantifiable.

Marketing: Generally, for this department, employers use something called Market Qualified Lead (MQL). The outputs or number of leads generated is what you need. For instance, these could be number of potential buyer touch points which, in turn, are leads for sales department to tap into.

Sales: The most obvious metric here is the number of conversions generated per lead provided or revenue from customers. In most organizations, part of a sales employees’ salary is tied to targets he/she achieves. Your employees’ performance per quarter will be a good indicator of his productivity.

Operations: Metrics here could range from project deadlines to innovation/value an employee can add to existing products. For instance, for customer service executives your metrics will be the level of customer satisfaction or number of calls he/she services.

Assign targets
Every boss’s favorite word! Yes, this is your chance as an employer to be on the other side. Once you’ve set the measures, you’ll need to track them. Define the periodicity: daily, weekly, monthly or annually, depending on the objective your employees need to achieve. At each review meeting you will have a clear indication of who is productive and who is not.

Check activities
Has someone put in genuine efforts and still didn’t get any results? It’s possible. This could be a result of a wrongly used approach to achieve the desired objective and is something you will need to be conscious of. Once identified, you’ll be able to change plan of action and hope for a better re-run.

Invest in software tools
Though you can’t rely solely on tools, these help up to a point in aggregating data and tracking productive time spent on work. There are quite a few available on the internet like Rescue Time, SharePoint by Microsoft, or regular CRM software used by managers to track productivity of sales and marketing personnel. Rescue Time for one is a background process that runs on a laptop/PC and consolidates all data related to productive work. How much time an employee spends on applications and the internet? Instead of being a ‘big brother’ to your employees, it’s advisable to have an open policy wherein employees themselves use these tools to track their own productivity. Many experienced entrepreneurs are of the opinion that empowering an employee generates better productivity than spying.

Hold regular meetings
Though most dreaded at companies, big or small, at some point it’s a must. You cannot leave everything to software alone, you’ve got to sit down periodically and take a personal recap of each department’s productivity flow. You could have weekly meetings where each department gets to report the progress, objectives and challenges faced.

For obvious slackers hold impromptu meetings. Remember no one works in isolation, so keep an eye on the slow coaches. However, with the current generation, as a manager you need to understand people’s individual work-styles and apply modern, practical approaches to discipline. Schoolmarm methods will only result in negative responses from your employees. While hiring right is important, trust is a crucial currency, so don’t let go of it.

Identify hindrances, deploy productive practices
Identifying hindrances is a bit of a grey area, because while some organizations, particularly larger firms, consider social media, YouTube et al to be hindrances to productivity, they have in effect become extremely useful business tools, especially for startups. You cannot deny complete access but you may monitor the purpose they are being used for. While your marketing and sales teams can use the internet in general for leads and promotions, your operations department, engineers and technical staff may not require it that much.

Depending on the department, you should deploy productive practices, which, in turn, will help you track outcomes. For instance, you could have ‘silent hours’ for technical/ R&D teams during which the team members don’t talk to each other, take phone calls, use computer or meet members from other departments. Instead, they dedicate this time solely to concentrate on work. Remember, whatever practice you deploy as a manger, at the end of the day it should result in work environment that’s conducive for your employees.

©Entrepreneur August 2011

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company, employees, entrepreneur, organisation, productivity, software, work