Workforce performance and productivity
This category describes the performance of individuals against role-based objectives and targets, including operational and behavioural aspects.
Common measures
Performance against objectives: this measures overall performance against defined key performance indicators for individuals and roles.
For instance, % of targets met
Per-unit full-time equivalents: this is the measure of how many full-time employees (FTEs) are required to fulfil a unit of work
For example, number of FTEs / unit produced
Volume of work completed: a measure of the completion of work against defined targets
Behavioural performance: this measures the performance of individuals in line with defined behaviours set by the organisation
For example, % of employees demonstrating compliance in line with organisational values and behaviours.
Stakeholder satisfaction: this is a measure of stakeholder warmth/engagement with the organisation and an indicator of the quality of relationships with key stakeholders.
% stakeholders reporting positive experience with employees
% of stakeholders reporting that objectives were met to the desired level/standard.
Labour utilisation: this is a measure of how employees are assigned tasks and the efficiency at which they are able to deliver against their tasked objectives. This measure could address availability or performance of employees.
Overall labour effectiveness: a measure of the utilization, performance, and quality of the workforce and its impact on productivity.
OLE measures availability, performance, and quality.
- Availability – the percentage of time employees spend making effective contributions
- Performance – the amount of product delivered
- Quality – the percentage of perfect or saleable product produced
Availability = Time operators are working productively / Time scheduled *100%
Performance = Actual output of the operators / the expected output (or labour standard) *100%
Quality = Saleable parts / Total parts produced *100%
Overall Labour Effectiveness = Availability x Performance x Quality
Effectiveness: this measures the utilisation of resources in order to achieve the desired result.
For example, actual output/Expected output * 100%
Efficiency: this measures the achievement of either maximum useful output from the resources devoted to an activity, or the required output from the minimum resource input.
For instance, resource actually used / Resources planned to be used * 100%
Expected productivity: this is the forecasting of potential/desired productive effort.
Expected output / resources expected to be consumed
Actual productivity: the measure of real efficiency of production.
Actual output / resources consumed
Further research
Research conducted by CEB on 1,500 senior executives reported a 20% compound increase required in employee performance levels in coming years. CEB rcommend that managers and leaders need to enable and strengthen three key behaviours across employees: connection, consumption, contribution. Find out more:
Resources description
Understanding your organisation’s human capital – its people – is key to driving productivity and sustainable high performance. Currently UK productivity is estimated as 2% lower than at the start of the recession in 2008. Read the CIPD policy report including an analysis of two YouGov surveys on how people and people management practices can drive productivity and what organisations can do to improve their performance.
Productivity: getting the best out of people
For practical guidance on coaching employees to achieve improved performance, download the CMI checklist.
Coaching for improved performance
Despite two years of solid economic growth, 21% of the organisations surveyed for our report are still stuck in ‘survival mode’ and aren’t making the necessary investments in equipment or people to boost their productivity. The following CIPD policy report explores this so-called ‘ambition ceiling’ which is preventing them from making the productivity gains needed to achieve business growth.
Investing in productivity: unlocking ambition
Resources
Case study
For over 75 years Xerox has been built on helping their customers solve complex business processes and challenges. In order to maintain sustained business and workforce performance, the HR and Finance functions at Xerox have integrated their strategic and operational thinking, understanding that their people processes are often at the heart of solving their business challenges.
CFO, Xavier Heiss, explains how the two business functions have worked together to increase the value of the services they provide through understanding the intangible value people bring to their customers, such as goodwill.
Read the full case study: Xerox case study