Learn how to analyse team productivity to improve your organisation’s effectiveness and efficiency in 6 simple steps.
To set the scene, business is booming, but you still think you can get more out of your team. All too often companies strive to improve productivity and utilisation without truly understanding the current state of play. In this article, we propose some simple ways in which you can analyse the performance of your team to help drive productivity improvement.
Understand your Current Productivity and Utilisation, together with underlying behaviours
It’s an old phrase and it remains true, “You can’t manage what you can’t measure”. This is highly relevant with employee productivity and utilisation where many variables govern how productive or how well utilised an employee is. Let’s take the example of a small business delivering products and services. What’s more productive, an employee who works 8 hours a day on internal product development or service delivery, or a similar employee who works 10 hours per day but spends 3 hours on administration, breaks and socializing? On face value, our 8 hour a day employee looks the most productive but we have no idea from hours alone how this impacts on the goals and objectives of the business or compares to what the employee was planned to do.
Let’s take the example of a consultant. Effective utilisation isn’t just about working lots of hours, it’s about how many of those hours are chargeable and billable. Plus, at the same time, if the consultant is missing deliverables and the client has low satisfaction, then actually how productive are they? Or worse, they are missing deliverables and working out of commission scope for no additional fee. Conversely, I have worked with many consultants who work less hours to achieve an objective simply because they are better planners and make more effective use their time. Imagine if you could create an environment that capitalised on this positive trait consistently? At a systemic level, the potential for improvement in utilisation is significant, and the improvement will, all other factors being equal, fall straight to the bottom line.
Before you can seek to improve productivity and utilisation, you will need a grasp of how your employees are currently spending their time. Timesheet apps will provide a good starting point here, allowing you to track employee hours against projects and activities. This is an overly simplified concept though, as employees will have different skill sets, knowledge and experience which means there will be varying levels of productivity. However, the data provided by your timesheet system will be invaluable in providing you with a base understanding of how your employees are currently using their time, and what proportion of time is engaged on productive activities. To reinforce the definition of productive, this means chargeable / billable activities that directly create value for the business.
Analyse and understand where you are today
You are in the process of implementing a timesheet system, and will need the ability to analyse the data. This is where the variables that you choose your timesheet system track are important. Categorising projects activities will enable you to assess the importance to the business of the work your employees carry out. For a consulting business, this may be as simply as chargeable and non-chargeable projects.
Defining the status of the different activities performed by your employees will also provide an additional level of analysis. Again, categorising activities as chargeable/non-chargeable or productive/non-productive will provide a good understanding of the quality of work your employees are undertaking and how this impacts the delivery of your projects and services. In a consulting business, the ratio of productive to non-productive use of time will vary according to the level people are at in the organisation. Managers will have responsibilities beyond fee earning. Likewise, the diversity of service offering (volume and timing) will influence utilisation, as will the length of project assignments. Bench time of employees between assignments can fast erode utilisation and in turn profitability.
Improve your Planning
With your timesheet application implemented, you now have a good understanding of what work your employees perform and how that translates into productivity and utilisation. However, what this information doesn’t tell you is how this compares to the work employees were planned to do. There is no point stressing that an employee is only 10% utilised on productive work if that was what was planned in the first place, or if that’s all that your current workload dictates. In the absence of a forward plan, your current utilisation and productivity figures really do not represent the status of the business, your current workload and the effectiveness of your managers.
Many tools are available such as project planning and resource scheduling applications which will enable you to schedule your employees on tasks, assignments and/or deliverables. Most importantly they provide management with useful information on the planned utilisation and productivity of employees. You can then use this information to design Key Performance Indicators (KPI’s) such as planned utilisation vs. actual utilisation, planned deliverables vs. completed deliverables. Being able to compare planned with actual data will give you the tools you need to improve productivity. Also, planning and scheduling will also help you balance your resources, identify poorly utilised resources upfront as well as identify future skills shortages and training requirements which will all have a positive effect on future productivity and utilisation. Extend your planning to include the planning of resources and profit to be delivered by project. This will require an integrated timesheet and project costing system that will “cost” the productive hours needed to deliver the project. As part of your planning process, ensure accountabilities for project delivery are unambiguous. Focus too on ingrained behaviours that lead to over delivery
Join up sales and delivery conversations and manage customer expectations
It is not uncommon for sales people to be over enthusiastic in the projection of your company offering, or for there to be a disconnect between the sales team and the delivery team. The sales team may be eager to sell, and fail to consult with those charged with delivery, leaving residual risks to be managed in the face of a demanding client. This will lead to firefighting rather than focusing on core project deliverables, and lost opportunities to upsell the company offering. For this reason, it is important that you implement some form of project management process in your business that fully encapsulates your entire product or service delivery process from initial enquiry through to project delivery. Alongside this implement a process to manage customer expectations, making it clear what will be received. By ensuring that everybody involved in the product or service delivery process has a clear understanding of the scope, risks, deliverables and acceptance criteria associated with your projects, there will likely to be fewer project issues, less slippage and fewer budget overruns. This will allow your valuable resources to focus on more productive work.
“Productise” your offering
Seek ways to streamline your product or service delivery process with common tools, templates, and workflows. Ensure controls are in place to ensure what is planned to be done is done. Ensure controls are in place to manage changes to customer requirements.
Create a collaborative work environment
Seek to create a productive working environment where employees can collaborate, tapping into each other’s ideas and creativity. Invest in a collaboration platform. By providing your project team members with a platform where they can work in synergy, share ideas and knowledge; and where each individual team member’s contribution is focused on a common goal, your business will quickly benefit from greater innovation, better problem solving and greater efficiency in project delivery. The result: increased productivity and utilisation.
In summary, there are 6 simple steps to how your business can improve employee utilisation and productivity:
• Implement some form of time recording – “You can’t manage what you can’t measure”. By effectively capturing use of time, you can begin to understand your current utilisation and productivity.
• Define Appropriate Variables – if you sell services you will want to measure chargeable utilisation. Ensure you define variables that enable you to measure utilisation and productivity that is applicable to your business.
• Improve your planning – improving your resource planning upfront should not only improve your future resource productivity and utilisation, it will also give you a more realistic view of the health of the organisation moving forward.
• Manage Customer Expectations – communicate to your entire team the importance of managing the customers’ expectations from initial enquiry all the way through to project delivery. In the long run, you will have more delighted customers resulting in your employees having to perform less un-productive tasks.
• “Productise” your offering – Automate and standardise as much as you can to avoid re-inventing the wheel. Scrutinise and simplify management processes, eradicating processes that add no value.
• Encourage Collaboration – boost your productivity by creating an environment where your team members can easily share knowledge, ideas and lessons learned. This will not only improve individual productivity it will help improve standards and the quality of service delivery.
If you are seeking ways to improve productivity, Mutarem Management can help.
Source; Colin Morrell Mutarem Management