How to Calculate Employee Productivity: 5 of the Best Methods

Searching for ways to calculate the productivity of your employees, and identify areas where the workforce was least effective. Why not read the 5 best ways to calculate employee productivity methods discussed in this blog. 

Employee productivity calculation can be based on how well you produce goods, service clients, and extract output from the workforce. It even tells how efficiently you are able to close customers’ tickets to maybe fix electrical appliances.

Yet how can you tell whether your employees’ productivity is at its peak? You shouldn’t leave anything to chance. Productivity measurement and computation are essential for assessing employee performance and finding areas where employees are lacking.

In this guide, we’ll walk you through a step-by-step process for calculating productivity, with valuable insights and actionable strategies along the way.

Ready to get started? Let’s dive in.

What is Productivity in Business? In General

Productivity is a metric of company performance that indicates how well your company achieves its goals. It takes into account the quality and value of the job done in addition to just counting the hours spent or tasks finished.

Why Should You Calculate Productivity?

Knowing how to calculate productivity can assist managers, employees, and company owners in making better decisions. When you take steps to improve employee productivity, you’re doing more than just helping the company become more competitive. You’re laying the groundwork for employees’ engagement and motivation.

One of the most underappreciated aspects of productivity is its impact on employee satisfaction. Managers only see employees’ worth and contribution when they evaluate their productivity. As a result, productivity increases even further, and the workplace becomes happier.

The Productivity Formula to Calculate Employees’ Efficiency

Though we know that success has no formula attached to it—it’s the result of all the hard work, but calculating employee productivity does have a formula to it.

Start with a basic formula to quantify the relationship between inputs and outputs:

Productivity Formula Total Output / Total Input = Productivity Components of the productivity formula Here’s what each component means: 1. Output: This defines the quantity/number of commodities produced or the amount of money made from sales. 2. Input: These factors directly affect results, including the amount of time spent on activities or resources committed to a project. 3. Productivity: This indicates how well and quickly your employees produce outcomes throughout a pre-determined time frame.

*Disclaimer:

While the exact equation may vary depending on the context, the general principle remains the same: Divide output (what your organization produced) by input (what your workforce did, or which resources were used, to achieve that output).

The 5 Best Ways To Calculate Employee Productivity

There are several different ways to calculate employee productivity depending on what metrics you have to work with.

1. The Standard Productivity Formula

The productivity formula, in its most basic form, might be the most practical for some sectors and divisions. To calculate productivity, divide the total number of hours worked within a certain period of time by the quantity of goods or services produced.

For instance, let’s say it took 1,300 hours of employees’ work to produce 13,000 units last quarter. In this example, the calculation would be 13,000/1,300 = 10 units per hour.

This method can be used to determine the amount produced each quarter, but the quality of the items is not considered. Although it is effective for simple productivity estimates, other situations can call for a different strategy, considering more subtle elements like employee input or intended results.

2. Targets v/s Achievement Reports

Targets v/s achievement reports are clear indicators of employees’ productivity. They come in handy where precise measurements, such as the quantity of units produced, cannot be gained. Alternatively, you may figure out what proportion of your staff members’ targets have been met. Teams with well-defined goals and deadlines for reaching them can greatly benefit from this approach.

TrackoField auto-generates these reports, which allows you to review them regularly without having to mine the data manually. This data even helps you recognise areas of unproductiveness, and accordingly, you can devise strategies to rectify them.

For example, let’s say you set a target for your IT help desk to resolve 100 tickets each week, and they exceed that to address 120. You can measure productivity based on the percentage of goals met using the following formula: Achievement/Goal x 100. So, in this case, 120/100 = 120% of the goal.

3. Task Tracking

One of the easiest ways to evaluate work productivity is to keep track of the tasks given to employees. The time it takes them to complete the task or the extent to which they effectively solve the problem may be decisive factors. Job completion rates will eventually impact employee performance KPIs.

Many business owners believe that measuring the number of tasks an employee completes is a more accurate way to measure field employee productivity and output quality than measuring the number of hours they clock in.

Tracking tasks can be helpful, but it can also present difficulties at times because specific tasks might be tough to track employees and measure if you have trouble keeping track of the duties; determining how productive the person to whom the tasks were assigned would be a tough nut to crack.

Go Digital, Go TrackoField! If you are tracking projects and tasks using Excel spreadsheets, you need to upgrade to automation. With TrackoField’s task monitoring and allocation solution, you can streamline the process of monitoring your employees’ work with the assistance of several different project management tools.

 

4. Revenue per Employee

Using this method, you just divide the total number of people working during a given period by the revenue made during that period. Even though this method’s computation is straightforward, the results can be quite illuminating, particularly if you re-calculate it frequently. The more productive your company is, the bigger the revenue per employee.

For example, if you have 200 employees and your annual revenue is $1 million, your revenue per employee would be 1,000,000/200 = $5000 per employee. The drawback of this approach is that it leaves you without an idea of how productive each individual is, making it impossible to pinpoint workers who are exceeding or falling short of targets.

Read More – 13 Best Employee Productivity Monitoring Software in 2024

5. TrackoField- The #1 Tool for Measuring Productivity

TrackoField’s employee monitoring software is ideal for companies that need a high degree of accuracy. Its solution collects employee activity data on individual and team levels and signifies where employees are the most productive. Automating the productivity measurement allows you to see exactly how productivity changes over time and which factors influence it.

Field force management software is key to gaining complete visibility into the productivity and efficiency of the employees in real time. For example, with an order management system, sales reps can place orders instantly through the app. In parallel, managers can see this in real-time, making it easy to calculate the rep’s efficiency.

If you are operating a field team, calculating their productivity can be a tough task. However, TrackoField’s real-time tracking, geocoded attendance marking, task status calculation, and specific productivity reports can get you out of the problem.

The best part of – you get a free demo!

Conclusion

Measuring employee productivity in the business world has certainly got its upside, as companies are becoming more focused on getting the most out of their employees in limited work hours. Calculating field employee productivity allows you to see their efficiency and effectiveness and the profits yielded by each one.

However, modern distractions require modern technology to be wiped out, so we suggest TrackoField, an employee monitoring software. With it, you can effortlessly track and monitor tasks, attendance, and productivity.

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