An Essential Guide to Employee Productivity Metrics

Nearly half of respondents to Wrike’s Employee Engagement Survey claimed to be productive in less than 75% of the time they spend at work. This level of unproductivity translates to a ton of wasted resources and a lower figure on the bottom line. 

As a team lead or operational manager looking to improve workplace productivity, employee productivity metrics are your biggest ally. Think of this project as steering a ship. 

Employee productivity metrics are reliable navigation tools, helping you gauge the wind direction, adjust your course, and guarantee a smooth voyage. 

In this article, we'll unravel the importance of employee productivity metrics, exploring how they function as vital instruments to enhance each team member’s individual performance. 

So, let's dive into understanding and optimizing team productivity.

The importance of establishing metrics for employee productivity

Think of employee productivity metrics as the scorecards in your favorite sport but for work. They help companies determine labor productivity and what's working well. They also help everyone know the game plan, what's going right, and where there's room to do even better. 

Employee productivity metrics are not just about keeping score. They’re about boosting employee productivity and making sure everyone is on the same winning team. These metrics help you, as the team lead or HR manager, know where the team stands, where you're going, and how to get there. 

So, which productivity metrics are important? In the next section, we’ll explore nine top employee productivity metrics to pay attention to. 

9 top employee productivity metrics to set

The following employee productivity metrics are the most important for driving workplace efficiency. 

Evaluate work accuracy and attention to detail

This employee productivity metric forces the close examination of how well your employees complete tasks over a time period. It emphasizes the importance of making sure every aspect of the work happens with precision and careful attention. The easiest way to measure this is by measuring the error rate. A low result means a high accuracy rate and attention to detail.

Error Rate=(Number of ErrorsTotal Number of Tasks​)×100

Evaluating work accuracy helps organizations foster a work environment where attention to detail is valued and considered a key aspect of success.

Assess task quality in relation to quantity

Gauging how well your team performs tasks, considering both the amount and quality of output, is key to measuring productivity. It's like making sure that when your team bakes a batch of cookies, they maintain a high standard of taste and quality in each one. 

Here, you will want to measure quality against quantity:

Quality to Quantity Ratio=(High Quality OutputsTotal Outputs​)×100

This metric shows the importance of balancing productivity over a time period with excellent results. It creates a work environment where delivering exceptional outcomes is a key focus, enhancing the overall performance and reputation of the team.

Track completed tasks in specific timeframes

Quality is a vital metric to measure. But it’s not enough that this job gets done effectively. The timely nature of many business operations means you must also keep an eye on the time period it takes to complete it. There’s no sense in forecasting cash availability for the next week if the process takes a week to get done.

To measure this, look at the number of tasks completed on time within a period of time:

Task Completion Rate=(Tasks Completed on TimeTotal Tasks Assigned​)×100

A high rate means that work is getting done and employees are also meeting timely goals. It's about maintaining a balance, fostering efficiency, maintaining workplace motivation, and timely delivery in the workplace.

Gauge efficiency of resource utilization

Paying attention to employee productivity is incomplete if you’re not evaluating how well your team uses its resources. For employers and team leads, this is a key performance indicator that makes sure your team works smartly, optimizing resources to achieve maximum results. 

To do this, you’ll want to track the cash flow of each team. You can ask each team to prepare a weekly report by tracking it manually or using tools such as software for cash management. These automated accounting solutions can give you a complete overview of cash flow and allow you to monitor all of the day-to-day cash activities easily in real-time. 

They also reduce the potential for human error and reduce the time spent on tracking and monitoring cash flow and productivity. 

Calculate the revenue generated per employee

This involves determining how much each team member contributes to the company's overall income. As a simple metric, you can calculate the average revenue generated per employee by dividing the total revenue by the number of employees. 

You may also want to take a more detailed approach and look at the revenue each individual employee generates. That said, revenue and labor costs can be difficult to calculate for employees in non-sales-focused roles, who often have an indirect impact on overall revenue. 

Keep tabs on client or customer satisfaction levels

On the list of which productivity metrics are important, many team managers often neglect customer satisfaction levels. Customer satisfaction is key to a complete picture because only highly productive employees can deliver positive customer experiences. 

Take an ecommerce business that has to fulfill thousands of deliveries daily. Leveraging ecommerce order fulfillment software should mean a streamlined and efficient cash-to-shipping process that results in more orders going out and more satisfied customers.

But if your employees are stalling on tasks or getting distracted at the workplace, it’ll inevitably translate to fewer orders going out and fewer satisfied customers. 

Regularly assess how pleased your clients or customers are with your products or services. This can be done on a simple scale of 1 to 5 through surveys. Then, you can make improvements that foster positive relationships with your customers.

Measure teamwork within teams or across departments

This metric tracks how collaborative and effective teams are, making sure of a harmonious and productive work environment. It spotlights how well different team members work together in a group or between different teams in different company sectors. This is normally done through an index and can factor in many different elements. 

If you find that collaboration between teams could be improved, look to introduce project management tools like Trello or Asana so employees can stay on top of things more easily. Also, if you don’t already have one, you might want to invest in an intranet like that provided by Assembly to help your teams communicate better. 

Gauge employee adaptability and skill progression

This is one of the key metrics that answers the question of whether employees can adjust to new protocols and whether they’re improving their skills over time. It explores how flexible and skillful employees are, making sure they can adapt to changing work demands and continue growing in their roles. 

This index takes into account things such as the number of new skills acquired, proficiency levels, and the completion of training programs.

Track attendance for punctuality and work regularity

This metric helps make sure employees are consistently present and on time, contributing to a reliable and smoothly operating workplace. A simple way to track this is:

Attendance Rate=(Number of Days Present​Total Scheduled Work Days)×100

This metric will track how consistently they maintain their schedules.

Best practices in measuring employee productivity:

On the topic of measuring productivity, doing it right is a big deal. Here’s what you need to do.

1. Tailor-fit KPIs according to role specifics

Customizing KPIs based on individual job roles helps you evaluate employees on criteria directly relevant to their responsibilities, focusing on the specific skills and goals that matter most to their position. A member of the marketing team should have different KPIs compared to a customer service agent.

This approach enhances accuracy in assessing performance and motivates employees to excel in areas directly tied to their job functions.

2. Clearly communicate expectations

Next, you want to make sure each employee has a clear description of employee responsibilities and expectations. If, for instance, an employee’s responsibility changes or an addition happens, you should properly brief them before time. 

This level of transparent communication makes sure their productivity doesn’t fall below par. It’ll also show you care about their workplace experience and are not just interested in meeting your business goals. 

3. Provide continuous training and support

It’s said that a team is only as strong as its weakest link. So, it’s important to train and support your employees continually. This will aid their career growth, keep them happy, and, more importantly, let them remain highly productive.

4. Recognize and reward employee performance

Everyone loves to get some form of special recognition for their work. So make it a priority to reward competent employees regularly. This will keep hardworking and highly productive employees wanting to do more and others on their toes to improve their work rate.

Regularly review and adjust metrics for changing priorities

Businesses and the processes they run on are bound to change in response to economic and other prevailing factors. When this happens, it’s important to review and adjust your employee productivity metrics. 

Involve employees in goal-setting for engagement

Do you want employees to root for your business without telling them what to do? Involve them while setting goals. This will make sure that business goals are not strange to them as they were involved in the decision-making.

Use accurate data sources for reliable measurements

Using accurate data sources facilitates fair employee recognition, resource optimization, and informed decision-making. Prioritize complete and reliable data sources when measuring employee productivity metrics. 

Measuring employee productivity metrics

Employee productivity metrics are closely related to employee engagement. This is because an employee who is provided with all required tools and works in an encouraging environment will have productivity metrics that are off the chart.

Here, we’ve explored nine of the top employee productivity metrics for boosting efficiency in your workplace. Alongside this, communicate expectations to employees beforehand and provide continuous training and support to help them remain productive.