The Most Effective Way to Measure Your Team’s Productivity

Have you ever looked around your office and thought: my team is busy, but are they productive? You can see how much time your team is putting into their work. They come in early, or work late. They fill their calendars with meetings, and respond to every email that comes their way. You know that your team has the best intentions. But what are they actually doing? And is it producing the results you need? You need an effective way to measure your team's productivity. A way to know that all that time they spend devoted to their job is moving your company forward, and not simply spinning their wheels. The most effective way is to answer the questions below:

1. Does Your Team Know Where You're Going?

One of the best ways your team can improve its productivity is for everyone to understand where you're going -- to have well defined corporate goals, and to focus on only a few at a time. According to John Doerr in his book Measure What Matters:

In a survey of eleven thousand senior executives and managers, a majority couldn't name their companies top priorities. Only half of the could name even one.

If your team doesn't know the company's direction, they will have no idea how to do the things that will add value. Bob the Senior Manager might talk to 10 key contacts per day, but he might not know that none of these contacts have bought something from your company in the past year. He doesn't know that increased sales from your team is an important, which is a way for you to contribute to the company's key goals. So the first way to measure your team's productivity is to ask if they understand what is important.

2. Are You Committed to Your Specific Goals?

When I was CFO at a small startup, we worked hard to clarify a handful of important goals. The company was early stage, so our three goals were: fundraising, corporate partnerships, and pipeline product development. But the CEO had Shiny Object Syndrome. Every time someone mentioned an interesting idea in the industry, he wanted to give it a try. We found ourselves assessing several product acquisition opportunities which would require a complicated debt agreement. As the CFO, I was dragged into days of work on these side projects. As a result, our progress on fundraising and corporate partnerships stalled, which created a fire drill as time went on. We managed to raise funds in the nick of time, but missed our corporate partnership goals. It was impossible to be productive as a team when we were running in so many different directions. We would pivot every time the CEO found something new and interesting. The lesson is, while it's critical to have defined goals, they won't create a more productive team unless you commit to them.

3. Do You Have a Leading Indicator of Performance?

Once you've determined the few key goals for your company, you communicate them to your team, and commit to those goals (without chasing down every shiny object). The next step is to see if you have an indicator that measures your team's performance. Many companies use a P&L (profit and loss) statement to measure performance. And that is an important piece of the puzzle. But by the time you look back on the month, quarter, or year, all the activities that went into the P&L already happened, and all you can do is respond to them. But as Geno Wickman writes in Traction: Get A Grip On Your Business:

According to an old business maxim, anything that is measured and watched is improved.

So instead of looking backward, think about what you can measure to look forward in your business. Let's revisit Bob the Senior Manager, who talks to 10 key contacts per day. Talking to contacts can be one lead indicator, but that's not enough. Talking to those 10 contacts is not generating the sales, and everyone on your team now understands is a key goal. But if you track the steps in his process, you can determine what is working and what isn't. And better optimize your team's productivity. So for Bob, he could track the number of inbound versus outbound calls, the number of in-person versus phone conversations, the number of times he needs to talk to a contact before they make a purchase, and then the number of sales per week/month/quarter. Keeping track of each step will give a much better metric of what is working and where things are breaking down. It will also tell you the most productive step. For example, after tracking all the steps, Bob could realize that he makes 3 times more sales after in-person meetings than he does after phone conversations. So the way to measure Bob's productivity is to keep track of his percentage of in-person meetings.

4. Does Everyone Know Who Owns What?

So your corporate goals are set. Everyone understands which direction the company needs to go, but that doesn't meant that everyone on your team knows exactly what they are supposed to do. How they, individually, contribute. Accountability is a key component to measure your team's productivity. It is critical that everyone knows, understands, and owns their independent actions that contribute to the organization as a whole. When everyone is held accountable for their contribution, your team is more productive. They know what other people seek in them. And when team members show both ownership and accountability, your team develops trust in each other. Trust means less people checking or duplicating other team members' work, or wasting time micromanaging; and a much more efficient workplace.

5. Is Your Team Making Decisions?

The ability to make decisions is an effective way to measure your team's productivity. Decision making is difficult for almost everyone. People don't want to commit, in case the idea is wrong or something better comes along, especially in a team environment. But in Napoleon Hill's classic book Think and Grow Rich, he mentioned a study that analyzed 25,000 people that had experienced failure. In that study, lack of decision-making, or procrastination, was one of the major causes of failure. If you find that your team is spending a lot of time kicking a can down the road, instead of picking a direction, it's likely that your team is not as productive as you might hope. Kicking that can take up a lot of time and energy, and can often take more time than simply picking a direction and then pivoting later.

6. Is Your Team Focused on What Is Urgent, or What Is Important?

So you've set and communicated a few, clear goals. You have found your leading indicators, and your team has the power and ability to make decisions. But they still aren't reaching their targets. You still feel like they are working hard, but their results are not reflective of their actions... Take a deeper dive into what is slowing them down. Some productivity slowdowns come from a team culture that requires immediate responses to email and days filled with meetings. It's easy to use these actions as a proxy for productivity. But they aren't actually producing anything. So take a look at the daily actions of your team. Find out what they are doing that isn't directly related to the communicated goals. Help them prioritize the important tasks versus the ones that feel urgent because they showed up out of the blue. Remind them that it's okay to address unexpected tasks but, as David Allen recommends:

Do unexpected work as it shows up, not because it is the path of least resistance, but because it is the thing you need to do vis-a-vis all the rest.

The Bottom Line

There are a lot of ways to measure and enhance your team's productivity. But even if you find that your team is struggling with several of these issues at the same time, don't change everything at once. Pick a few things that stand out the most. See what works in your unique workplace and what doesn't. Take a few mindful steps toward a more efficient environment and be consistent. Productivity is always intentional. Remember, it doesn't mean that everyone on your team has to perfectly managed every moment of every day. The goal is to focus on actions that create the results you want and minimize the ones that don't.