Execs in your organization constantly look for ways to reduce labor costs and improve workforce productivity to keep up with competition. Most likely, those bosses don’t ask your advice … and you don’t give it, meaning you miss an opportunity to become a strategic partner in a crucial area of business.
To start playing a role in improving productivity, take the following steps:
1. First, look inward. Make HR departments more productive and measure the results. Some HR people want to jump into making the workplace more productive, yet they aren’t doing the same with HR basics like compensation, benefits, recruitment and training.
2. Focus on productivity areas with the biggest impact on profit and revenue, including labor costs per unit, the speed and quality of customer service and the performance of new hires.
3. Measure, measure, measure. Determine specifically how new programs will improve productivity and how you’ll measure it. Measure work-force productivity with formulas that work best for your company. Some simple metrics include revenue per employee and profit per employee. You may need to adapt the formulas and use different types for different divisions or departments. Consider the formulas as imperfect tools that require continuous refinement.
4. Rethink hiring in terms of productivity. Focus hiring on candidates with skills that match the organization’s business strategy. Example: A company with a large customer-service call center decided to hire outgoing and enthusiastic employees. Productivity dropped because the company should have hired good listeners and problem solvers.
5. Position HR as a “productivity consulting center” where managers can come for productivity improvement answers, suggests HR consultant John Sullivan. Be able to solve these kinds of issues for managers:
- How to motivate employees to increase their output.
- How to provide employees challenging work and an environment that reduces the risk of top performer turnover.
- How to assemble a work force capable of increasing innovation and product quality at industry “disrupting” levels.
