Employee Productivity Calculator is an excel template that helps you calculate employee productivity for manufacturing, sales/marketing, and service industries.
Therefore, just enter the required data and you can calculate the productivity in terms of units, dollars, hours, etc.
What is Employee Productivity ?
Employee Productivity is the production/revenue received during a specific period against the number of employees or resources consumed in that specific period. Productivity is measured differently depending on the industry.
Thus, in the manufacturing Industry, employee productivity can be measured in terms of units produced per period, units produced per employee, the worth of goods in dollars per period, the worth of goods in dollars.
Moreover, for the Sales/Marketing Industry, it is measured in terms of sale of units per employee per day, sales in dollar per employee per day.
Whereas, in the Service industry, employee productivity is measured in terms of clients/projects handled per employee, the number of projects completed per employee or per hour, etc.
Formula to Calculate Employee Productivity
The basic formula for calculating employee productivity is the output divided the input during a particular time.
Employee Productivity = Output / input
Types of Employee Productivity
There are 3 types of employee productivity:
- Unit Productivity,
- Dollar Productivity, and
- Hourly Productivity.
You can obtain employee productivity by dividing the average output per period by the total inputs consumed during that period. The input includes capital costs, energy costs, material costs, and manpower.
Furthermore, while we measure sales productivity, we will have to add a variety of additional outputs, like the number of new customers, the number of positive leads generated, and the volume of sales in dollars.
Moreover, in the service industry, as intangible outputs are involved you will be able to measure the number of customers served or the number of tasks completed.
Whereas, in the manufacturing industry, you will either measure the production per employee or worth of goods one employee can produce during that specific time.
Besides, productivity in the service industry changes depending on the industry. It all depends upon the purpose and industry for which you measure productivity.
Thus, as shown in the example below, turning the company into a sales company gives the revenue per salesperson, and the same in manufacturing shows the units per employee or worth of unit produced per employee.
Contents of Employee Productivity Calculator
This template consists of 3 major sections: Manufacturing Industry, Sales/Marketing Industry, and Service Industry.
Each of the above sections is further divided into subsections.
In Manufacturing Industry, employee productivity is measured in terms of units, dollars, and hours.
In the Sales/Marketing Industry, employee productivity is measured in terms of units and dollars.
In the service industry, employee productivity is calculated in terms of clients or projects, dollars, and hours.
Moreover, this template can be helpful to manufacturing units, sales managers, freelancers, service providers, etc.
Importance of Measuring Employee Productivity
There are many benefits when it comes to measuring employee productivity. Thus, here are a few that will convince you to focus on this aspect of employee management.
- Proper usage of the workforce that maximizes the production helps to lower operational costs.
- A decrease in operational costs eventually leads to increased profits.
- Measuring employee productivity helps the management to better human resource management.
- It helps in the timely supply of goods or services to your customers and in turn, it increases customer satisfaction.
- Increased profitability opens the doors for growth opportunities.
- A well-managed production helps the business to beat their competitors.
Hence, measuring employee productivity must be an important part of any business.
Additionally, as an employee is an investment, the Human Capital ROI must exceed the employee cost. Therefore, the growth of an organization lies in the difference between an employee’s productivity and employee cost.
Ways to Improve Employee Productivity
Employee productivity has a huge impact on profits. With a simple equation, you can track productivity per individual, team, or even department. Here are some simple steps you can take to improve employee productivity.
- Knowing the skill sets of your employee and matching tasks to their skill.
- Effectively Communication.
- Create Incentive Programs.
- Encourage Flexible Working Hours.
- Use the data of your employees to identify the need for proper structuring of the workforce.
- Focus on quality rather than quantity. It applies to service industries and also to the manufacturing industry.
- Provide opportunities for your employees to develop their skills by providing them with proper training.
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Frequently Asked Questions
What are the 3 crucial things that affect Employee Productivity?
Employee Engagement, Workplace Environment, and Technology are the three crucial things that affect employee productivity.
What is the effect of low productivity?
Lower productivity has a big impact on employee morale. Moreover, it also hinders efficiency. Eventually, the profit margins of the company are also affected.
Unfortunately, lower productivity is the result of internal issues like poor management, unavailability of proper tools and equipment, etc.
What is the 70 percent rule for productivity?
The 70 percent rule is a time management principle that suggests that employees should withhold at least 70% of their time productive out of total working hours. This markup is the best performance. To effectively do this you need to prioritize your tasks.
Download and use Employee productivity calculator free excel template
To use this free printable employee productivity calculator excel template, you should have Microsoft Office/ Microsoft Excel installed in your system.
Once extracted, you can open the file using Excel and start entering data or customizing the template. You can customize the currency, color scheme, fields in this excel template as per your requirement.