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14 Ideas on How to Measure Productivity to Make Incredible Progress

14 Ideas on How to Measure Productivity to Make Incredible Progress

Everyone has heard the term productivity, people talk about it in terms of how high it is and how to improve it. But fewer know how to measure productivity, or even what exactly we are talking about when using the term “productivity”.

In its simplest form, Output ÷ Input = Productivity.

For example, you have two salespeople each making 10 calls on customers per week. The first one averages 2 sales per week and the second one averages 3 sales per week. By plugging in the numbers we get the following productivity levels for each sales person.

For salesperson one the output is 2 sales and the input is 10 sales calls 2 ÷ 10 = .2 or 20% productivity. Salesperson two, the output is 3 sales and the input is 10 sales calls 3 ÷ 10 = .3 or 30% productivity.

Knowing how to measure and interpret productivity is an invaluable asset for any manager or business owner in today’s world. As an example, in the above scenario, salesperson #1 is clearly not doing as well as salesperson #2.

Knowing this information we can now better determine what course of action to take with salesperson #1.

Some possible outcomes might be to require more in-house training for that salesperson, or to them accompany the more productive salesperson to learn a better technique. It might be that salesperson #1 just isn’t suited for sales and would do a better job in a different position.

How to Measure Productivity – 14 Proven Management Techniques

Knowing how to measure productivity allows you to fine tune your business by minimizing costs and maximizing profits:

1. Identify long and short term goals

Having a good understanding of what you (or your company’s) goals are is key to measuring productivity.

For example, if your company’s goal is to maximize market share, you’ll want to measure your teams productivity by their ability to acquire new customers, not necessarily on actual sales made.

2. Break down long term goals into smaller weekly objectives

Your long-term goal might be to get 1,000 new customers in a year. So that’s going to be 20 new customers per week, if you have 5 people on your team then each one needs to bring in 4 new customers per week.

Now that you’ve broken it down you can track each persons productivity week by week just by plugging in the numbers:

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Productivity = number of new customers ÷ number of sales calls made

3. Create a system

Have you ever noticed that whenever you walk into a McDonald’s, the french fry machine is always to your left? Why is that?

It’s because McDonald’s created a system. They have determined that the most efficient way to setup a kitchen is to always have the french fry machine on the left when you walk in.

You can do the same thing just adapt it to your business.

Let’s say that you know that your most productive salespeople are making the most sales between the hours of 3 and 7 pm. If the other salespeople are working from 9 am to 4 pm, you can potentially increase productivity by something as simple as adjusting the workday.

Knowing how to measure productivity allows you to set up, monitor and fine tune systems to maximize output.

4. Evaluate, evaluate, evaluate!

We’ve already touched on using these productivity numbers to evaluate and monitor your employees. But don’t forget to evaluate yourself using these same measurements.

If you have set up a system to track and evaluate your employees performance but you’re still not meeting goals, it maybe time to look at your management style. After all, your management is a big part of the input side of our equation.

Are you more of a carrot or a stick type of manager? Maybe you can try being more of the opposite type to see if that changes productivity. Are you managing your employees as a group? Perhaps taking a more one-on-one approach would be a better way to utilize each individuals strengths and weaknesses.

Just remember that you and your management style contribute directly to your employees productivity.

5. Use a ratings scale

Having clear and concise objectives for employees is a crucial part of any attempt to increase workplace productivity. So once you have set the goals or objectives, it’s important that your employees are given regular feedback regarding their progress.

Using a ratings scale is a good way to provide a standardized visual representation of progress. Using a scale of 1-5 or 1-10 is a good way to give clear and concise feedback on an individual basis.

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It’s also a good way to track long term progress and growth in areas that need improvement.

6. Hire “Mystery Shoppers”

This is especially helpful in retail operations where customer service is critical. A mystery shopper can give feedback based on what a typical customer is likely to experience.

You can hire your own shopper, or there are firms that will provide them for you. No matter which route you choose, it’s important that the mystery shoppers have a standardized checklist for their evaluation.

You can request evaluations for your employees friendless, how long it took to greet the shopper, employees knowledge of the products or services and just about anything else that’s important to a retail operation.

7. Offer feedback forms 

Using a feedback form is a great way to get direct input from existing customers. There are just a couple of things to keep in mind when using feedback forms.

First, keep the form short, 2-3 questions max with a space for any additional comments. Asking people to fill out a long form with lots of questions will significantly reduce the amount of information you receive.

Secondly, be aware that customers are much more likely to submit feedback forms when they are unhappy or have a complaint than when they are satisfied.

You can offset this tendency by asking everyone to take the survey at the end of their interaction. This will increase compliance and give you a broader range of customer experiences.

8. Track cost effectiveness

This is a great metric to have especially if your employees have some discretion over their budgets. You can track how much each person spends and how they spend it against their productivity.

Again, this one is easy to plug into the equation. Productivity = amount of money brought in ÷ amount of money spent.

Having this information is very useful in forecasting expenses and estimating budgets.

9. Use self evaluations

Asking your staff to do self evaluations can be a win win for everyone. Studies have shown that when employees feel that they are involved and their input is taken seriously, morale improves. And as we all know, high employee morale translates into higher productivity.

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Using self evaluations is also a good way to make sure that the employees and employers goals are in alignment.

You can try to make use of this self evaluation form.

10. Monitor time management

This is the number one killer of productivity in the workplace. Time spent browsing the internet, playing games, checking email and making personal calls all contribute to lower productivity.

The trick is to limit these activities without becoming over-bearing and affecting morale. Studies have shown that most people will adhere to rules that they feel are fair and applied to everyone equally.

While ideally, we may think that none of these activities should be done on company time, employees will almost certainly have a different opinion. From a productivity standpoint it is best to have policies and rules that are seen as fair to both sides.

11. Analyze new customer acquisition

Nothing comes free. We’ve all heard the phrase that “It’s more expensive to get a new customer than it is to keep and existing one”. And while that is very true, in order for your business to keep growing, you will need to continually add new customers.

Knowing how to measure productivity via new customer acquisition will make sure that your marketing dollars are being spent in the most efficient way possible. This is another metric that’s easy to plug into the formula, Productivity = number of new customers ÷ amount of money spent to acquire those customers.

For example, if you run any kind of advertising campaign, you can compare results and base your future spending accordingly.

Let’s say that your total advertising budget is $3,000. You put $2,000 into television ads, $700 into radio ads and $300 into print ads. When you track the results, you find that your television ad produced 50 new customers, your radio ad produced 15 new customers and your print ad produced 9 new customers.

So let’s plug those numbers into our equation. Television produced 50 new customers at a cost of $2,000 (50 ÷ 2000 = .025 or a productivity rate of 2.5%). The radio ads produced 15 new customers and cost $700 (15 ÷ 700 = .022 or a 2.2% productivity rate). Print ads brought in 9 new customers and cost $300 (9 ÷ 300 = .03 or a 3% return on productivity).

From this analysis, it is clear that you would be getting the biggest bang for your advertising dollar using print ads.

12. Utilize peer feedback

This is especially useful when people who work in teams or groups. While self assessments can be very useful, the average person is notoriously bad at assessing their own abilities.

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Just ask a room full of people how many consider themselves to be an above average driver and you’ll see 70% of the hands go up! Now we clearly know that in reality about 25% of drivers are below average, 25% are above average and 50% are average.

So are all these people lying? No, they just don’t have an accurate assessment of their own abilities.

It’s the same in the workplace. Using peer feedback will often times provide a more accurate assessment of a persons ability than a self assessment would.

13. Encourage innovation and don’t penalize failure

When it comes to productivity, encouraging employee input and adopting their ideas can be a great way to boost productivity. Just make sure that any changes you adopt translate into higher productivity.

Let’s say that someone comes to you requesting an entertainment budget so that they can take potential customers golfing or out to dinner. By utilizing simple productivity metrics, you can easily produce a cost benefit analysis and either expand the program to the rest of the sales team, or terminate it completely.

Either way, you have gained valuable knowledge and boosted morale by including employees in the decision making process.

14. Use an external evaluator

Using an external evaluator is the pinnacle of objective evaluations. Firms that provide professional evaluations use highly trained personnel that even specialize in specific industries.

In consolation with you, they will design a complete analysis of your businesses productivity level. In their final report, they will offer suggestion and recommendations on how to improve productivity.

While the benefits of a professional evaluation are many, their costs make them prohibitive for most businesses.

Final thoughts

These are just a few of the ways you can measure productivity. Some may work for your particular situation, and some may not.

The most important thing to remember when deciding on how to measure productivity is to choose a method consistent with your goals. Once you’ve decided on that, it’s just a matter of continuously monitoring your progress, making minor adjustments and analyzing the results of those adjustments.

The business world is changing fast, having the right tools to track and monitor your productivity can give you the edge over your competition.

Featured photo credit: Unsplash via unsplash.com

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David Carpenter

Lifelong entrepreneur and business owner helping others to realize the American Dream of business ownership

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Last Updated on July 3, 2020

6 Things To Do Every Day To Ensure You Stick To Your Goals

6 Things To Do Every Day To Ensure You Stick To Your Goals

Sticking to your goals can sometimes be challenging. We all want better health, better careers, and better jobs, and we want to cast an impression on everyone that we are living fulfilled lives.

Yet to reach our goals and make every minute of our time count requires commitment, consistency, and hard work. Setting goals is one thing, but sticking to them is another. We have to observe certain daily practices if we want to get the best out of ourselves.

Here are 6 things that you have to ensure daily to reach your goals.

1. Involve Others

You have to be accountable for the actions you are committing yourself to. Involve everyone around you, get them engaged, and talk to them on how they can help you accomplish your goals.

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When you involve others you feel, you have a responsibility towards them as well as yourself. Every day, make sure you are accountable for sticking to your goals. By joining groups or engaging others, you have more motivation to reach your goals.

For example, if you want to read more, try joining a book club. If you want to be a better entrepreneur, join an entrepreneurial organization.

2. Visualize the Rewards

Reaching a goal can be challenging and sometimes, it can be overwhelming. When the journey becomes tough and difficult, try to stick to visualizing your successes every day.

Wake up to visualize what rewards you will get from sticking to meeting your goals. If you want to lose some pounds, visualize yourself already underweight and benefiting from being underweight. The mind has a way of channeling your body and intentions to sticking to your goals and reaching them.

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3. Break Down Your Goals

Try to break down your goals into tiny chunks. The smaller the size of the goals, the more willing and prepared you are to meet them.

For example, if you find it difficult to get out of the house and take a workout at the gym, why not try to break the goal into making sure you are always dressed for the gym daily? By doing this, you demonstrate that you are moving in the right direction, and you can keep this momentum so you can meet the larger goal.

4. Reward Yourself

For every progress you make daily towards reaching your goals, try to vindicate and reward yourself. By doing this you appreciate yourself and the hard work you have put in for the day.

When you reward yourself, you program yourself to benefit from a larger reward in the future. You also propel yourself to gain daily rewards, which can be enticing and motivating. Rewarding yourself serves as a form of positive reinforcement that reinforces your mind and behavior to stick to your goals and stay motivated.

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5. Measure Your Progress

It is easy to become frustrated when you are not getting instant results. Change can be slow and rewards are not always immediate. Still, progress can be measured even in tiny bits, so take time to look back at where you are coming from.

You don’t have to feel depressed about not making that major progress in an instant. But when you journal or snap pictures to document your progress, no matter how small, you will feel grateful and elated to see what difference you have made from where you are coming from up until now.

6. Believe in the Possibilities

If you don’t even believe in the possibility of reaching your goals, how can you expect yourself to stick to your goals in the first place?

By believing in the possibilities of accomplishing a goal or task, you increase your chance of reaching it and eradicating whatever roadblocks or challenges you may face. Believe in what you can achieve.

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What self-belief has over self-control is that while self-control can be depleted but self-belief cannot. We all have an enormous reservoir of how much we can believe in ourselves.

With believing in ourselves comes perseverance, determination, and desire to reaching our goals. Every day, understand that what you need to keep going is your belief toward achieving your goals. Your goals are reachable if you think you can reach them!

Final Words

Due to circumstances in life, people tend to abandon some of their goals in life. You may also feel this way sometimes. In that case, just come back to this article and remember the 6 ways you can help yourself stick to your goals.

People don’t always reach their goals, but you will never know if you can reach them if you don’t stick to them in the first place. As long as you stick to your goals, there will always be the possibility of you achieving them!

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Featured photo credit: Kelly Sikkema via unsplash.com

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