Employee productivity is basically the efficiency of employees in task completion and contribution to company goals. The productivity rates, ratios, and KPIs are considered to calculate employee productivity in Bangladesh. External and internal factors often influence employee productivity in Bangladesh. Using HR software to track and calculate employee productivity helps improve and quicken the process.
As advanced processes and technologies are changing how we work, methods of tracking and measuring productivity are too. HR practitioners along with software providers are putting in the effort to recreate HR practices in Bangladesh.
What Is Employee Productivity, Rate, KPI, Ratio & HR Measurement in Bangladesh?
Employee productivity rate is the output per worker, usually calculated per hour worked. This metric indicates how efficiently work is performed. Businesses use HR Key Performance Indicators (KPIs), like output per employee or units per hour, to measure performance against goals.
Another metric, the Productivity ratio, like output-to-input or efficiency percentages, is used to benchmark processes. For example, garment factories monitor labor efficiency to control costs. Also, HR measurement is how you use these metrics to evaluate and improve employee performance. HR managers in Bangladesh are becoming more reliant on KPIs and analytics to improve accountability and productivity.
How to Calculate Employee Productivity in Bangladesh?
Measuring employee productivity in Bangladesh involves a structured approach. The approach combines traditional metrics with modern HR practices created for the country’s diverse industries.
- Set Benchmarks: First, determine performance standards based on industry benchmarks or company standards. For example, the Bangladesh National Productivity Organization (NPO) prepares the national productivity plan with the cooperation of the Asian Productivity Organization. This signifies benchmarking in numerous local sectors.
- Track Actual Output: Secondly, monitor the workers for the volume and quality of work done. In industries such as Readymade Garments (RMG), production is counted in terms of units per hour. In the service industry, it could be the job done or the people served.
- Measure Input: Once you have set the ground rules for benchmarking and tracking, now is the time to evaluate the resources utilized, such as manpower, materials, and capital. This helps in tracking and analyzing the efficiency of resource utilization.
- Apply the Productivity Formula: A standard productivity formula is:
Total Output / Total Input = Productivity
So, if a business produces 100 units in 5 hours, then the productivity is
100/5 = 20 units per hour
What Are the Employee Productivity Calculating Methods and Formulas?
To calculate productivity, you have to collect the data on the inputs you used and the outputs you produced. Inputs could be natural resources, hours of labor, cash, etc. Outputs, on the other hand, are usually the number of sales of the goods or services that were produced.
Quantitative Approach
- Revenue Per Employee: Here, you will divide the total income by the number of employees. For example, if BDT 800,000 in sales is earned over the period with a team of 400 laborers, the revenue per employee will be BDT 2,000. It focuses more on an organization’s overall performance than on individual performance.
- Percentage of goals met: Another way to check productivity is by measuring the quantity of work goals employees achieve. To assess this indicator, you will require definable targets. The basic formula is:
Percentage of goals met = (Actual output / Planned goal) X 100
Now, let’s assume you had a goal of producing 100 units and the final output was 75 units. So, the percentage of goals met will be: (75 units/100 units) x 100 = 75%. - Employee utilization rate: This is the percentage of an employee’s labor hours spent on tasks or projects that can be invoiced to customers. This measure of productivity has widespread use in the service industries. The formula for this is:
Utilization rate percentage = (Billable hours for a specific period / Total employee work hours for the period) x 100Now, if a company’s billable hours are 8 hours and total employee work hours are 32 hours, the utilization rate percentage will be: (8hrs/32 hrs) x 100 = 25%.
- First-contact resolution percentage: This metric measures how effectively your staff can resolve customers’ questions or issues the first time they emerge over a specific period (such as a week or month). The formula is:
First-contact resolution percentage = (Issues resolved the first time / Total issues handled by customer service reps) X 100
Assume the employees of a company encountered 25 issues in a week and resolved 5 of them. Here, the first-contact resolution percentage will be: (5/25) x 100 = 20%. - Focus hours per day: This is to calculate the hours spent working without being interrupted by distractions (like meetings, emails, breaks, etc.). This metric is often measured by time-tracking tools that monitor activities to separate focused work from distractions. The basic formula for this is:
Focus hours per day =Total work hours−(Meeting time+email/chat time+breaks/interruptions)
Let’s assume an employee spent 2 hours at a meeting and 1 hour for lunch. The total daily working hours is 8 hours. So, the focus hours per day will be:
8 – (2+1) = 5 hours.
Qualitative Approach
Unlike quantitative methods, this typically doesn’t have standard formulas you can use. But you can take a survey or satisfaction measuring form and assign a numerical rating to some standardised answers (e.g. Well done, could be better etc.) to quantify and track qualitative productivity in employees
One way is known as the 360-degree review, in which you survey an employee’s managers and peers to assess their performance. Another measurement is taking direct feedback from the employee. It’s the easiest and most effective method to gauge employee productivity. You can also measure productivity by measuring how much they are motivated by what they are doing or how engaged they are. This is also known as “employee engagement”.
What Are the Factors Influencing Employee Productivity?
Productivity is affected by numerous phenomena including external forces and internal processes. And poor productivity can come in the form of conflict, inefficient work, poor time management, and inadequate resources. The common factors to consider are:
- Interest toward work: If an employee is disengaged and not enjoying their work, they will become less productive.
- Skill and development: Employees with the right skills are generally more productive than those without. Also, if employees see a lack of development scopes or training, they will lose interest or remain unskilled and become unproductive
- Time management: A balanced working hour system helps employees maintain a healthy work-life balance, whether through fixed 8-hour shifts or flexible schedules. When stress and energy levels are managed effectively, productivity improves and so does employee attendance.
- Technology used: Employees benefit greatly from advanced technologies and automation, which enable organizations to accomplish tasks more quickly and efficiently. Traditional methods or subpar technologies will result in increased time consumption, which will negatively impact productivity.
- External Factors: Governments’ rules and regulations, and global or national trends also influence how effectively employees perform. For instance, during the COVID-19 pandemic, employees had to work from home. Some gleefully accepted it; others did not find home environments conducive for work.
How Does HR Software Help to Track Employee Productivity?
HR software helps in employee management, shift management, performance reviews, and setting clear KPIs. Businesses in Bangladesh can use best HR software like PiHR to automate HR processes like tracking and calculating employee productivity. This tool provides real-time performance analytics that help in regular evaluations and feedback, thus improving employee productivity. Features like task management, digital notice boards, and timely notifications make it easier to stay organized, improve work quality, and keep employees more satisfied.
Final Words
Identifying and increasing the efficiency of workers is an integral part of becoming successful in business. Companies need to evaluate employee performance correctly, consistently, and measure productivity with proper methodology and tools. By gaining a grasp of productivity measures, put into practice efficient measuring methods. Address the factors that have an impact on employee productivity. Also, utilizing HR software, organizations can automate the calculation of employee productivity and accomplish their objectives efficiently.
