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  June 8, 2015  

Strategic HR Weekly "Sales" Tip #28

The Employee Productivity discussion...

can be one of the toughest to specifically quantify in a business. It's easiest in a true physical production environment. It's also pretty easy for direct sales jobs. But in jobs like administration, finance, IT, etc., it becomes much more challenging.

Every C-suite member will agree it's not 100%. That's impossible. But how do you determine if it's at a level worth improving? And how can a number be put on the status quo starting point, so that the financial impact of improvement can be modeled and tracked? The ability to do that puts some meat on bone of HR initiatives that are targeting employee productivity, but lacking some point of measurement just leaves us with "a feeling" that things are either improving or not.

A relatively recent study by Gallup reflected that 29% of U.S. workers were "Engaged", 54% were "Not Engaged", and 18% were "Actively Disengaged". Again, we can read those numbers and know that employee productivity is not 100%. But what is it? The missing part of the calculation is assigning an employee productivity number to each of those levels of engagement, and that assignment has the possibility of being wildly subjective.

Just for an example, I assigned what my mind said would be conservatively high productivity numbers to the 3 levels, and they're shown in the table below. Bear in mind that the more global you go in a company, as opposed to looking at small department or unit groups, the higher the margin of error will be in your illustration.

As you can see, doing the math two different way lands on a productivity number of about 74%. But if someone else's idea of what the productivity assumptions numbers should be for each level were different than mine, then the end results would be totally different.

That's why the C-suite doesn't put a whole lot of weight into "studies have shown" type business arguments. It can be a good starting point to open everyone's eyes to the potential problem and/or improvement opportunity, but the more specific the ensuing evaluations and actions can be about the company directly in the spotlight, the more buy-in HR will get for its proposed initiatives from the C-suite or department/unit leaders.

If it can be measured, it can be improved,
Some VERY important stuff is VERY hard to measure.


Rob Blunt       View our profile on LinkedIn
President, 4-Profit-HR

phone: 866-868-5885