Defining Productivity- How to improve it (strategies, tools etc.)

Employee productivity is an essential part of the workplace that the quest to improve is continuously on. Approaches and tools on how to enhance productivity are presented in this article.

Defining productivity

A female being productive as she is completing every task on hand.

Did you know that according to a study by Marketwatch, the U.S. productivity figure has increased by 1.7 percent in 2019, which is considered to be the largest gain in the past nine years?

In addition, McKinsey, in an article claimed that employees with superior talents are up to eight times more productive than regular employees.

Furthermore, in a Udemy In-Depth: 2018 Workplace Distraction Report, it found out that at least 70% of participants have agreed that training people can help them better block distraction at works, and achieve focus, thereby increasing their productivity.

Finally, in The Global Innovation 1000 Study a study of more than twelve hundred enterprises and institutions across the globe, it was found out that innovation has contributed to an increase in productivity by 11% per year in developed countries, on average, over the last fifteen years.

Defining productivity is not an easy feat. With the many different kinds of productivity, it might be difficult to pinpoint which ones matter the most. After all, if you are already doing great at your work, it might not be necessary to know how productive you are right now.

In a broader term, though, productivity is simply put as the efficient use of human resources to achieve expected outcomes for an organization or a business.

Importance of productivity

We cannot emphasize more the importance of productivity, as Peter Drucker once said, "if you're not growing, you're dying." Therefore, productivity can be considered a tool to help you grow and become better.

However, most of us find it difficult to define exactly what productivity is. The importance of productivity in an organization is crucial. It is the best way to measure how well employees are doing their job and if they need any improvement.

Productivity is also the key to the success of a business, so much so, that according to recent studies of productivity, at least 8 out of 10 businesses that fail in the first 18 months have low productivity.

Furthermore, productivity is the best way to compete in today's economy. Since both the number of jobs and workplaces are growing, it becomes increasingly difficult to be above average, which means that having a high productivity level will set you apart from the crowd and will make you specialize in your field. 

Types of productivity

Productivity has different forms, each one of them as relevant as the others.

There's the productivity that a company has concerning its employees. This is called labor productivity. If you divide what your business produces by how many people are working for it, you'll get this number and it will inform you about your business' performance.

Then there's the productivity that a company has, concerning the goods and services it provides. This is called "total factor productivity." It refers to both the labor input and capital/technology contribution of a business.

Another aspect that must be carefully measured is how much real (i.e., inflation-adjusted) value you get for your money spent on something (business or personal). This is called the productivity of money and it's a severe problem concerning public administration in most countries, where too little value is being produced for what you pay as tax.

It's easier to see productivity growth happening if you compare two points in time. If, however, you just want to know about your performance over the last year you can still use the GDP deflator to get a productivity measure. The US Bureau of Labor Statistics (BLS) calculates this number for private businesses and organizations.

In one sense it's a bit magic how they calculate labor productivity because they are using both hours worked and output produced. Fortunately, most of the calculation is automated so that a productivity analyst doesn't have to look at massive amounts of data or crunch numbers manually.

Productivity is the most important indicator of living standards over time. That's why countries, politicians, and companies always try to improve it, but still, we hear about how little things have changed recently.

What productivity is not?

Of all the given definitions, it is also essential to know what productivity is not. Productivity is not the same as efficiency. Efficiency is doing things right, while productivity is doing the right things.

Many processes are extremely efficient, but they're not productive at all because they don't help achieve organizational goals or have no impact on your company's bottom line. The Lean approach to business helps companies focus on getting rid of all sorts of waste to boost productivity.

At the same time, companies should not invest in trying to maximize productivity by 'working smarter.' This would be a huge mistake — as we'll see later on, productivity is all about working harder!

Productivity is also not about doing more with less as this causes stress levels to rise and productivity plummet.

In business, productivity is all about "doing the right things" — is your company still performing tasks that are irrelevant for its goals? Is it operating on a business model that's no longer market-relevant or attractive? It may be time to redefine productivity and make sure the company is doing the right things with fewer resources — its key success factor.

How to measure productivity?

A female using survey on her phone as a way to measure productivity in her company.

There are various ways on how to measure productivity, such as labor productivity, multifactor productivity, some official statistics as well as the use of surveys and questionnaires.

Labor productivity

Most often the labor productivity is measured as to how much output (goods or services) was produced per unit of labor input (the number of workers, their work hours, and wages). This measure can be used both in the manufacturing and service sectors.

Multifactor productivity

Multifactor productivity is a measure of economic growth that focuses on labor productivity in the industry, excluding the influence of capital. This measure is constructed by subtracting the growth of labor and capital inputs from the growth of output (GDP).

Official statistics

According to some official statistics, one of the most important factors responsible for economic growth is productivity increase. The rate at which productivity increases in different sectors greatly influences economic growth.


There are many surveys conducted to determine the level of productivity. For example, in 2015 Miller Heiman, an independent research company that specializes in sales and marketing strategies, conducted a survey that points out some important factors influencing productivity:

  • 65% of respondents said that they would switch to competitors with better customer experience if there is no improvement in productivity;
  • 75% of respondents said that they are not happy with the overall productivity since they need to use multiple platforms for interacting with clients and product delivery; and
  • 57% of respondents said that lack of motivation affects productivity but only about 20% think their managers motivate them well enough.


Questionnaires show that two main factors are impacting the productivity of staff in companies: complacency and lack of motivation. Questionnaires can be used to find out how many employees are satisfied with their tools and the company as a whole, what they think about the productivity of their colleagues and managers.

Strategies to improve productivity

A female creating a strategy on a map on how to increase productivity.

Various strategies can be used to increase productivity. Let's consider these two approaches in more detail:

  • Motivate your team and yourself to work better by improving the company culture; and
  • Keep track of the progress made by different team members, encourage them to improve their performance.

Culture improvement

Company culture can be improved in various ways (e.g., through team-building exercises). When a team is motivated, they can come up with new ideas to improve productivity. It also doesn't hurt if the company as a whole invests in its employees – for example, by providing them with beautiful and quiet conference rooms or with ergonomic workstations.

It should be noted that sometimes it's not easy to improve productivity. In some cases, employees are not motivated and cannot come up with good ideas on their own; in other cases, it might be really hard to implement the most promising ideas (e.g., because of high labor costs).

Nevertheless, even small productivity improvements can make a huge difference over time; this is why companies should try to pay more attention to productivity growth.

Note that not only can productivity be increased; it can also be decreased. This might happen if there is a high turnover rate or some employees are incompetent (i.e., they cannot do the job well).

Keeping track of improvements

Improving productivity should be relatively easy because companies can simply monitor the amount of work done by their employees and compare it to how much they get paid. To make this process as easy as possible, modern technologies are used (e.g., in form of automated tools).

This means that companies have to focus more on productivity growth because they cannot afford to have labor productivity stagnate or decrease.

Keeping track of improvements in your organization's productivity is important, as it the most important factor determining a company's success or failure, as it directly determines how much revenue the company can generate with its current resources, and thus, eat into your workday.

Factors that Affect Productivity

Several factors affect productivity. It could be, for instance, that workers are under a lot of stress and thus have difficulties concentrating on their work. Or perhaps management is very unprofessional. Maybe the individuals in a company lack the ambition to succeed (i.e., they are not ambitious enough) or maybe there is no real vision/strategic plan at all (this means that employees don't know where the company is going or how to get there).

Or maybe it's something completely different. Maybe regulation or legislation in a country/jurisdiction makes it difficult for employees to work effectively and productively.

In some countries, for example, you have to take typically one hour per day off (i.e., they have not defined flexible time) to attend the 'mandatory' daily briefings. These daily briefings are usually held at each different project site during lunchtime and thus, eat into your workday.

Another factor that can affect productivity is simple things, like interruptions. An article posted Apollo Technical claimed that it takes people 23 minutes to refocus after they were interrupted. What's more, that according to a study conducted by researchers at the University of California, Irvine, employees experience interruptions approximately every three minutes and five seconds.

All of these factors are important to consider when measuring productivity.

Techniques to improve productivity

A female boss planning on ways to improve productivity with a long piece of paper highlighting the timeline, cash flow, and time management.

Techniques to improve productivity are aplenty and can be as varied as the people using them. Despite this variety, there are a few techniques that tend to work best in general. This article will explore some of these, including the following:

Time Management and organization

Time Management and organization is a technique that most people know, but fail to put into practice.

One simple method that works for many is the Pomodoro Technique, which simply requires you to work in 25-minute intervals with 5-minute breaks (and longer breaks after a few cycles of this).

Productivity Environment

Productivity Environments are the tools and other resources available to a workforce that support worker performance. Productivity environments can be considered as physical and informational environments where the work takes place.

Productivity in Practice

Productivity in practice means that an organization or other group of people is capable and effective in producing the desired goods, services, or results. In practice, productivity refers to the effectiveness with which resources are used to produce outputs.

Tools that can be used to improved productivity

A male worker working on the maintenance of machine using tools. Similar with productivity, there are tools that you can use to help productivity.

A more comprehensive time management and organization strategy would include using productivity apps on mobile devices and computers. There are many productivity apps available, including the following:


For time tracking, toggl can help you improve your productivity, as it helps you get started on the right tasks and stay focused. It also makes it easier to work with others, share billing with team members, and analyze billable hours.


This is a popular note-taking app that can help improve your productivity by keeping you organized. You can use it to store information and resources, set up reminders, collaborate on notes with others, and more.


For a file storage system that also has an option to backup data from your mobile devices, Dropbox can be a helpful way to stay organized and share files with others. This app is important for entrepreneurs as it helps you collaborate on different projects and tasks easier, which will help improve productivity when working with other people.

Rescue Time

For effective productivity and time tracking software, Rescue Time can be used to monitor your internet usage and other programs that you are using on your computer. The app keeps track of data from different websites and programs, so it will help you understand where time is being wasted when working or doing other tasks online.


A good platform for entrepreneurs, Trello is a great app that you can use to keep everything in order. You can arrange your tasks, deadlines, and projects into different lists. It also has functions for collaboration, so it will help increase productivity when working with other people.


If you like more communication and less emailing, Slack is the one that you should choose. This app is a messenger and at the same time, it has also functions for sending documents, files, and other stuff that you might need. You can also create chat rooms, which means easier collaboration with your team members.

Skype for Business

Skype for Business is for making and receiving calls, sending instant messages, and also having video conversations. You can do these things with your friends, but you can also use them for work. 


Gmail is one of the most widely used email applications and it's free. It comes with some really useful features, like labels, filters, automatic organization, or even chats function. This is a very useful feature because you can always know when your colleagues are online and ready to collaborate on something.


Zoom is a company that focuses on developing video conferencing tools, like webinars, virtual events, or even general videoconferences. The service is available for free and you don't need to install anything - all you need to do is register and make an account.


Amplitude is a platform that helps you identify user behavior patterns and understand what motivates them to visit your website. You can then focus on improving those things to achieve more engagement or sales. Since the tool has an extensive collection of reports, there's no need for any other analytics tool, which makes it very simple to use and understand.

Methods to use to improve productivity

2 individuals jumping on a trampoline having fun to avoid burnout.

There are various methodologies that you can use to understand why improving productivity is beneficial for you. Knowing the root of the problem is half of the solution, so if you're not able to motivate your workforce or yourself, then you could use some advice from relevant literature.

Methodology #1: Timeboxing

Timeboxing is an approach where a team has one or more iterations or timeboxes to complete a certain project at regular intervals, rather than the tasks being worked separately and in parallel. This means that all team members are working closely on one product throughout the iteration - like during Scrum events.

While this concept is very simple and easy to use, it also has drawbacks such as unneeded stress from planning and the rise in the probability that some tasks were done too early.

Methodology #2: Burnout

Burnout is what happens when you're overloaded with work for a long time, and at one point it hits your mental or physical capacity - causing frustration, stress, and unhappiness. This usually causes people to become unmotivated and want to slow down their work pace.

Methods to avoid burnout:

Set priorities - Don't try to do everything at once, and choose your tasks wisely; always prioritize important things over boring but easy ones.

Learn when to say "no" - If you constantly accept new commitments, you'll get too many things going on at once. It's very important to learn how to say no and stick to your decisions.

Leave time for relaxation - Most people who work a lot without leaving enough free time get burnout, so make sure you take some rest days now and then.

Methodology #3: Mindless Work

This happens when employees carry out their tasks in a mechanical way, without focusing much thought on them. It can be caused by the use of software tools that automate some work processes and don't require any thinking. People end up spending an excessive amount of time at work, but without even noticing it  (they are not engaged in their work). To prevent such a situation, introduce automation for some tasks but don't let it take over entire workflows. Keep parts of the job that are important for employee satisfaction so they remain engaged in their work.

Don't forget to reward good performance, even if it is not linked to business objectives - Employees will value only the things that have a direct impact on their compensation and will try to meet the expectations of their managers. Instead, set some performance metrics that are not tied to specific results, but rather to the development of an employee.

Effects of improved productivity

A male co-worker motivating his co-worker with food and coffee after a hectic day.

There are various methodologies that you can use to understand how you can improve productivity and what causes it. Knowing the root of the problem is half of the solution, so if you're not able to motivate your workforce or yourself, then you could use some advice from relevant literature.

If you want to see productivity increase, it is necessary to think about the process of hiring a new employee. If you take too long for the recruitment of personnel, they will begin to lose interest in their work and productivity.

Furthermore, if the person hired did not bring any added value to your company, it will be more difficult to motivate him. The motivation to work in a company that does not reward individual effort and achievement would be lower than those who face no obstacles to their development within the organization.

A good way to motivate employees of all levels is to apply some recognition system, which will allow you to provide incentives to any employee who works hard and is smart. Besides encouraging productivity, this system will also be a good way to get rid of unproductive employees, who can not meet your expectations.


It can be said that the productivity of a company is defined as the ratio between its total production and the effort expended. To ensure sustainable growth, it is necessary to implement various measures aimed at increasing labor productivity.

The main challenge here – is to motivate employees, making them understand their role in achieving targets and rewarding them for their achievements. It is not necessary to achieve productivity with the help of a simple equation, it's okay to keep trying new things until you hit on what works best.

Frequently Asked Questions (FAQ)

The subject of productivity is broad, and many questions are surrounding it. The following section addresses some of the most commonly asked questions on productivity, productivity measure, and productivity growth: 

Can we define productivity?

The definition of productivity is an individual decision. Some businesses measure labor productivity, which is the ratio between the number of employees and the amount of revenue they generate. Some define productivity as the ratio between the number of employees and revenue minus cost.

Productivity has a lot of varying definitions, that is why it is important to carefully consider what it means to you when you are trying to improve productivity.

How to define productivity index?

You can define productivity index as the ratio between output and input.

The common mistake is to measure the productivity of one individual. It is more productive to measure the productivity of a team or department because it is almost impossible for one person to be as productive as a group of people working towards the same goal.

What are the key tools for improving service productivity?

The key tools for improving service productivity are:

  • Increasing automation of certain tasks, and following up with measuring the increase in productivity that resulted from this; and
  • Defining if a task can be done by more than one person simultaneously or must it be done consecutively because the answer will greatly influence the strategy to follow for improving productivity.

These tools can help in the productivity growth of your employees. 

How do you motivate staff to improve productivity?

There is no simple answer to this question. Productivity can be increased by motivating employees rather than punishing them for failing to deliver the expected results. If your employees feel that their efforts are not appreciated, they will never try as hard as they could have. Also, giving bonuses and similar rewards for good results does not mean that you should ignore the quality of those results.

In improving productivity, you must first decide what it is that you expect from your employees before rewarding them. This will show them that you are keeping track of their progress and that they cannot fool you by only working for a couple of hours every day and skipping the rest of the time.

You should also make sure that you provide the tools your employees need to do their job well. If they are not given the equipment and resources required for completing certain tasks, it would be impossible for them to do a good job, let alone exceed your expectations.

Another way of improving productivity is by providing an environment that stimulates creativity and problem-solving skills. If you want to see your employees working at peak performance levels, they should be allowed to use their imaginations.

What are the 3 factors that are critical to productivity improvement?

The three factors that are critical  in ensuring productivity improvement:

  1. Job Satisfaction – if your employees are not happy with their job, they will never work to the best of their abilities.
  2. Innovation - workers should be encouraged to come up with new ideas and carry them out for innovation to take place.
  3. Work Environment - having a good working environment is an important factor in productivity.

How can productivity be improved in the workplace?

Productivity in the workplace can be improved through job satisfaction, innovation, and work environment.

If employees are satisfied with their job, they will put more effort into what they do.

If workers are innovative, the company will benefit from it as new ideas can be taken and used to make the company run better.

Having a good work environment is important because if your employees don't like where they work or what they are doing, they will not be productive.

What are the factors that affect employees’ productivity?

Employee productivity can be affected by several factors such as age, education, and motivation.

Age is an important factor to take into consideration when it comes to employees’ productivity because if the employee is too old or too young, they might not be able to do certain tasks that a worker of an appropriate age may be able to do better.  

Education is another important factor that can affect an employee’s productivity. A worker with more education will usually be able to do tasks faster and more efficiently than a worker with less education.

In conclusion, several factors can affect an employee’s productivity and they include age, education, and motivation among others.

Claim your welcome gifts

- 100+ Social Media Content Ideas
- 2022 Social Media Content Calendar
- Ultimate Facebook ads checklist
- 7-step Kingsmaker Growth Blueprint
and more...
No spam, only valuable content. Guaranteed!

If you don't like it, unsubscribe at any time. Seriously, no hard feelings.