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How the Productivity Formula Can Motivate Employees to Work Efficiently

How the Productivity Formula Can Motivate Employees to Work Efficiently

In 1911 Frederick Taylor, an American engineer turned management consultant, published a book, The Principles of Scientific Management, which revolutionized practices for workplace efficiency.[1]

In the book, Taylor proposed the idea that employee productivity and motivation could be altered by changing specific variables. By optimizing these variables, companies could maximize workplace efficiencies and profits, whilst minimizing costs and eliminating inefficiencies.

Since Taylor’s ideas were published several decades ago, these important variables have been integrated into a simple equation that managers and leaders use to measure and improve employee motivation and productivity.

The simple equation is called the productivity formula and here’s how it works.

What is the Productivity Formula

The productivity formula is a measure of the productivity of an economy, organization, team or employee. In the context of a company it provides a useful indication of how efficiently a company converts raw materials, machines and groups of employees, into useful goods or services.

And this can be represented in the surprisingly simple productivity formula:

    The productivity formula is a basic relationship between physical input and output variables. The most common inputs are labor hours, capital and materials and the most common output units are sales and amount of goods produced.

    A company that produces more with a given variable of inputs (capital, labor, and materials) or uses fewer inputs to produce the same level of output has greater productivity and a competitive advantage over a company that produces a lower amount.

    The productivity formula illustrates how a company can produce more units of output per employee hour, machine or material used.

    How to Use the Productivity Formula

    As an example, a manager may want to calculate the productivity of the employees of his company or team.

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    In order to do this, employee productivity can be calculated by dividing the goods and services produced or sales revenue generated by the total hours the company’s employees worked in a given period of time.

    For example, if an employee called Tom, made sales worth $2,000 in one week of 50 hours worth of work and another employee called James works 20 hours a week and made $1000 worth of sales, then using the productivity formula:

    Tom’s productivity: $2000/50hrs = $40/hour

    James’ productivity: $1000/20hrs =$50/hour

    In this hypothetical scenario, James is more productive than Tom even though James generated less sales than Tom.

    Here’s another example:

    Imagine a retail company looking to measure its productivity. If the output of last month’s production was 20,000 units and the total employees hours worked was 2,000 hours, then based on the productivity formula:

    Company productivity: 20,000 units/ 2,000 hours= 10 units/hour

    As a final example, consider a heavily automated production line with a small number of staff. If say in a month the production line produces $1 million dollars worth of goods with 1000 total hours worked, then the company productivity is:

    Company productivity: $1,000,000/1000 = $1000/hour

    Even though the labor cost is much smaller than the cost of equipment, a company that invests in the efficient use of technology will gain a competitive advantage and improve company productivity than otherwise.

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    Managers can use this formula to determine which employees are the most and least productive, or the efficiency of a company in using its resources and materials.

    Nevertheless, this version of the productivity formula is limited due to its simplicity and restriction in variables.

    As per the examples above, this productivity formula only uses single units for input and output to calculate productivity and that’s why it’s described as a partial factor productivity.

    For a more accurate measurement, a company will need more inputs and outputs to calculate its overall productivity.

    This is where the multi-factor productivity formula could be useful.

    The Multi-factor Productivity Formula

    As previously noted, the partial or single-factor productivity formula is limited as a wholesome measure of productivity.[2]

    The multi-factor productivity formula helps managers to measure the productivity of various departments across a company.

    With this formula, productivity is measured by comparing output to a various inputs necessary for production. This includes ratios of units produced to materials, labor and capital.

    For example, switching one variable for another i.e. labour for capital, could produce a significantly different productivity figure. A more efficient measure of productivity should take into account the different substitutes for input and output and accurately represent how they affect company productivity.

    Whereas the partial factor productivity formula uses one single input, the multi-factor productivity formula is the ratio of total outputs to a subset of inputs. For example, an equation could measure the ratio of output to labor, materials, and capital. This method is a more comprehensive measure than partial factor productivity, but it’s also harder to calculate.

    For example, imagine a car manufacturing company which purchases advanced machine equipment to increase its production. Assuming this equipment enables the company to reduce the number of employees and costs 40% more than a standard machine cost, output will remain the same.

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    But since the number of employees has reduced, the labor and capital productivity of the company will increase. And there will be a decline by 40% in material productivity since output is constant and purchased material has increased.

    As a further consideration, a ‘Total Factor Productivity’ formula will take into account all inputs used in a production process and provide a more accurate assessment of company productivity and performance.

    How to Improve Employee Productivity with the Formula

    Here are 3 strategies based on the productivity formula to improve employee productivity:

    1. Measure and Improve the Efficient Use of Time

    Time, though not purchased, is often mistakenly ignored as a cost.[3]

    For example, if two companies have identical equipment, staff, products and material, but one business takes two weeks longer than the other to ship order purchases, their productivity is not the same.

    Managers who work with employees to maximize their time spent on tasks that align with their strengths and minimize time spent on everything else, will improve employee productivity.

    2. Promote Employee Autonomy

    In his book, Management Challenges for the 21st Century, legendary management expert, Peter Drucker writes that:

    “The demands that we impose the responsibility for their productivity on the individual knowledge workers themselves. Knowledge Workers have to manage themselves. They have to have autonomy.”

    Various studies have shown that human beings derive the greatest levels of motivation and satisfaction from achieving goals that are chosen by themselves or ‘self determined.

    Self-determined goals increase intrinsic motivation–i.e. the desire to do something for its own sake–rather than extrinsic motivation.[4]

    Intrinsically motivated people take more action on a given task, persist in the face of adversity, explore more creative ideas, enjoy their work and perform better.

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    The more autonomy and ownership employees have over their work role, the more productive they will be.

    Managers who include employees in setting goals and give them the autonomy to execute on them can significantly improve their productivity.

    3. Encourage Team Empathy

    In Smarter Faster Better : The Secrets of Productivity in Life and Business, author Charles Duhigg describes the story of how Google improved their team performance through “Project Aristotle,”[5] an extensive research into team productivity.

    At the end of their research period, Google discovered that the best teams weren’t necessarily a collective of individual top performers, rather a collective of individuals who shared empathy with one other.

    Teams that encouraged members to listen to one another and show sensitivity to each others needs performed the best.

    That is why people with high emotional intelligence tend to be the best leaders in a group setting.

    They tap into the emotional component of human motivation to get the most out of the people around them.

    The People’s Productivity Formula

    The productivity formula is a simple, useful tool to quantify, measure and manage employee productivity.

    As a standalone benchmark of productivity, it may not be sufficient as a measure of productivity that takes into account the complexities of a company.

    The best way for managers to use the productivity formula to motivate employees is to incorporate the people element.

    By maximizing time efficiencies, promoting employee autonomy and team empathy, managers can build a workplace culture that encourages long term productivity and satisfaction.

    Featured photo credit: Stanley Dai via unsplash.com

    Reference

    [1] New York Times. March 22, 1915.: F. W. Taylor, Expert in Efficiency, Dies
    [2] Bureau of Labor Statistics. U.S. De partment of Labor. Retrieved 11 March 2017: Multifactor Productivity – Overview
    [3] Paul Krugman, The Age of Diminishing Expectations (1994): “Defining and Measuring Productivity”
    [4] American Psychologist, 55, 68-78. Ryan, R. M. & Deci, E. L. (2000). Self-determination theory and the facilitation of intrinsic motivation, social development, and well-being.
    [5] New York Times: Project Aristotle

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    Last Updated on October 22, 2019

    How to Focus and Concentrate Better to Boost Productivity

    How to Focus and Concentrate Better to Boost Productivity

    We live in a world of massive distraction. No matter where you are today, there is always going to be distractions. Your colleagues talking about their latest date, notification messages popping up on your screens, and not just your mobile phone screens. And even if you try to find a quiet place, there will always be someone with a mobile device that is beeping and chirping.

    With all these distractions, it is incredibly difficult to concentrate on anything for very long. Something will distract you and that means you will find it very difficult to focus on anything.

    So how to focus and concentrate better? How to focus better and produce work that lifts us and takes us closer towards achieving our outcomes?

    1. Get Used to Turning off Your Devices

    Yes, I know this one is hard for most people. We believe our devices are so vital to our lives that the thought of turning them off makes us feel insecure. The reality is they are not so vital and the world is not going to end within the next thirty minutes.

    So turn them off. Your battery will thank you for it. More importantly though is when you are free from your mobile distraction addiction, you will begin to concentrate more on what needs to get done.

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    You do not need to do this for very long. You could set a thirty-minute time frame for being completely mobile free. Let’s say you have an important piece of work to complete by lunchtime today. Turn off your mobile device between 10 am and 11 am and see what happens.

    If you have never done this before, you will feel very uncomfortable at first. Your brain will be fighting you. It will be telling you all sorts of horror stories such as a meteorite is about to hit earth, or your boss is very angry and is trying to contact you. None of these things is true, but your brain is going to fight you. Prepare yourself for the fight.

    Over time, as you do this more frequently, you will soon begin to find your brain fights you less and less. When you do turn on your device after your period of focused work and discover that the world did not end, you have not lost an important customer and all you have are a few email newsletters, a confirmation of an online order you made earlier and a text message from your mum asking you to call about dinner this weekend, you will start to feel more comfortable turning things off.

    2. Create a Playlist in Your Favourite Music Streaming App

    Many of us listen to music using some form of music streaming service, and it is very easy to create our own playlists of songs. This means we can create playlists for specific purposes.

    Many years ago, when I was just starting to drive, there was a trend selling driving compilation tapes and CDs. The songs on these tapes and CDs were uplifting driving music songs. Songs such as C W McCall’s Convoy theme and the Allman Brothers Band’s, Jessica. They were great songs to drive to and helped to keep us awake and focused while we were driving.

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    Today, we can create playlists to help us to focus on our work. Choose non-vocal music that has a low tempo. Music from artists such as Ben Böhmer, Ilan Bluestone or Andrew Bayer has the perfect tempo.

    Whenever you want to go into deep, focused work, listen to that playlist. What happens is your brain soon associates when you listen to the playlist you created with focused work and it’s time to concentrate on what it is you want to do.

    3. Have a Place to Go to When You Need to Concentrate

    If you eat, surf online and read at your desk, you will find your desk a very distracting place to do your work. One way to get your brain to understand it is focused work time is, to use the same place each time for just focused work.

    This could be a quiet place in your office, or it could be a special coffee shop you use specifically for focused work. Again, what you are doing is associating an environment with focus.

    Just as with having a playlist to listen to when you want to concentrate, having a physical place that accomplishes the same thing will also put you in the right frame of mind to be more focused.

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    When you do find the right place to do your focused work, then only do focused work there. Never surf, never do any online shopping. Just do your work and then leave. You want to be training your brain to associate focused work with that environment and nothing else.

    If you need to make a phone call, respond to an email or message, then go outside and do it. From now on, this place is your special working place and that is all you use it for.

    Every morning, I do fifteens minutes of meditation. Each time, I sit down to do my meditation, I use the same music playlist and the same place. As soon as I put my earphones in and sit down in this place, my mind immediately knows it is meditation time and I become relaxed and focused almost immediately. I have trained my brain over a few months to associate a sound and a place with relaxed, thoughtful meditation. It works.

    4. Get up and Move

    We humans have a limited attention span. How long you can stay focused for depends on your own personal makeup. It can range from between twenty minutes to around two hours. With practice, you can stay focused for longer, but it takes time and it takes a lot of practice.

    When you do find yourself being unable to concentrate any longer, get up from where you are and move. Go for a walk, move around and get some air. Do something completely different from what you were doing when you were concentrating.

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    If you were writing a report in front of a screen, get away from your screens and look out the window and appreciate the view. Take a walk in the local park, or just walk around your office. You need to give your brain completely different stimuli.

    Your brain is like a muscle. There is only so much it can do before it fatigues. If you are doing some focused work in Photoshop and then switch to surfing the internet, you are not giving your brain any rest. You are still using many of the same parts of your brain.

    It’s like doing fifty pushups and then immediately trying to do bench presses. Although you are doing a different exercise, you are still exercising your chest. What you need to be doing to build up superior levels of concentrated focus is, in a sense, do fifty pushups and then a session of squats. Now you are exercising your chest and then your legs. Two completely different exercises.

    Do the same with your brain. Do focused visual work and then do some form of movement with a different type of work. Focused visual work followed by a discussion with a colleague about another unrelated piece of work, for example.

    The Bottom Line

    It is not difficult to train your brain to become better at concentrating and focusing, but you do need to exercise deliberate practice. You need to develop the intention to focus and be very strict with yourself.

    Set time aside in your calendar and make sure you tell your colleagues that you will be ‘off the grid’ for a couple of hours. With practice and a little time, you will soon find yourself being able to resist temptations and focus better.

    More Resources About Boosting Focus and Productivity

    Featured photo credit: Wenni Zhou via unsplash.com

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