Set expectations measure and communicate Results Count
Set expectations measure and communicate Results Count
In this economy, people are more apprehensive than usual, so expectations and measurement and communication are even more important.
One of my good bosses, and I have been blessed to have a few, gave out wall plaques that said Results Count. I believe that once you learn that lesson it stays with you forever.
One of my good clients, and I have been blessed to have a few, asked me to set up an incentive system for his construction supervisors. And we did, but he really wanted, first, to establish a reporting system of work done, blocks laid and slabs poured and time lost, as a visible record that highlighted problems and usually solutions.
What results do we measure? Aim for a total productivity measurement
Generally when "Productivity" is discussed, we really mean "Labor", the people side of the manufacturing enterprise. But if we measure only labor we get information that is useless at best and misleading at worst. One company may be highly automated, so their labor productivity is very good compared to a more manual company. But the automated company may be unprofitable because it has so much money invested in equipment, or runs higher expense to maintain equipment. Delphi in 2005 sought bankruptcy protection at the same time that many of its factories were winning Lean Manufacturing awards.
Measure total productivity in an organization to capture the comprehensive effect, but also individually measure labor, executive prowess, waste, equipment utilization, inventories, effective automation, employee input, sales and marketing, new products introduction, product quality, customer service. See how the result tracks with the bottom line of the P&L and other financial results in use already.
What result is a good productivity index? What is bad?
Is it possible to look at one productivity number and learn if it represents an acceptable rate or not? No. There is not one magic number because are too many variables involved. One can at best measure productivity over a period of time and determine how much it changes. Even then, an arithmetic result does not indicate what actions caused the change.
Just because there are complicating factors to productivity measurement, do not stop the effort to measure. Recognize that answers may not be perfectly accurate, but still can be a good indicator of productivity change. And you can fine tune the initial mechanism to yield ever better results.
Units of measure
You will probably need to apply different units of measure, because the groups being measured are different, and their output is expressed differently. If possible, relate units to the business of the entity, tractors produced per man hour, insurance policies written, ads sold, packages delivered. Measure a factory by units of tractors produced per man hour, but the sales organization by tractors sold, and the customer service group by tractors maintained.
Results comparisons over time periods
A productivity value as stated has no meaning alone. Measure again in a month using exactly the same procedures, or last year, and the values start to have significance as they are compared.
Apples to apples
Comparisons tend to be inaccurate unless they are "apples to apples", with factors the same from one comparison to another. Yet comparisons over time seldom involve purely identical sets of variables. We all know that does not happen, even on this morning’s breakfast or trip to work. Don’t obsess over the lack of absolute consistency because you will never have it; merely state assumptions, calculate carefully, check answers, and use what you find.
One significant variable in productivity measurement is sales volume. Sales volume will always affect productivity measurement; incrementally more volume will cause more direct cost of materials and labor, but usually no more plant managers or corporate aircraft or receptionists. Most companies will therefore convert added sales to better productivity, as well as better overhead absorption and better profits. Incrementally less volume will have the opposite effect.
Busy versus productive
A group may be busy but not productive. If output is measurable but has no value to the business entity, then the group that generates such output may have 100% busy-ness but zero productivity.
Another group may not be always busy but at the same time contribute extensively to the productivity of their overall organization. Examples are maintenance people who keep their equipment in good repair so that they can stand by while operators produce. A busy maintenance person usually means the equipment is not at work and that is bad.
Other groups who should be idle for good overall productivity are security guards, police and firemen.
Preventive maintenance hours may take the place of demand maintenance, and crime prevention and better building codes may take the place of emergency reactions. Costs may be shifted but still be present.
Caveat
Be advised that the results of any measurement, productivity or otherwise, can report only part of the story, the final result; it does not report what caused the result. For instance, the much emulated Toyota Production System emphasizes personal development of line workers and supervisors, which is usually accomplished by training. In a productivity measurement result, training will appear to be unproductive time but would shortly lead to even higher productivity as learned lessons are put into effect.
Jack Greene, Jackson Productivity Research Inc.
Set expectations measure and communicate Results Count - To learn more about this author, visit Jack Greene's Website.
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You, and I, and the people in your company want to know what is expected of them (and their group and the company) and how well they do against expectations. Measure productivity and see how well you produce results.
In this economy, people are more apprehensive than usual, so expectations and measurement and communication are even more important.
One of my good bosses, and I have been blessed to have a few, gave out wall plaques that said Results Count. I believe that once you learn that lesson it stays with you forever.
One of my good clients, and I have been blessed to have a few, asked me to set up an incentive system for his construction supervisors. And we did, but he really wanted, first, to establish a reporting system of work done, blocks laid and slabs poured and time lost, as a visible record that highlighted problems and usually solutions.
What results do we measure? Aim for a total productivity measurement
Generally when "Productivity" is discussed, we really mean "Labor", the people side of the manufacturing enterprise. But if we measure only labor we get information that is useless at best and misleading at worst. One company may be highly automated, so their labor productivity is very good compared to a more manual company. But the automated company may be unprofitable because it has so much money invested in equipment, or runs higher expense to maintain equipment. Delphi in 2005 sought bankruptcy protection at the same time that many of its factories were winning Lean Manufacturing awards.
Measure total productivity in an organization to capture the comprehensive effect, but also individually measure labor, executive prowess, waste, equipment utilization, inventories, effective automation, employee input, sales and marketing, new products introduction, product quality, customer service. See how the result tracks with the bottom line of the P&L and other financial results in use already.
What result is a good productivity index? What is bad?
Is it possible to look at one productivity number and learn if it represents an acceptable rate or not? No. There is not one magic number because are too many variables involved. One can at best measure productivity over a period of time and determine how much it changes. Even then, an arithmetic result does not indicate what actions caused the change.
Just because there are complicating factors to productivity measurement, do not stop the effort to measure. Recognize that answers may not be perfectly accurate, but still can be a good indicator of productivity change. And you can fine tune the initial mechanism to yield ever better results.
Units of measure
You will probably need to apply different units of measure, because the groups being measured are different, and their output is expressed differently. If possible, relate units to the business of the entity, tractors produced per man hour, insurance policies written, ads sold, packages delivered. Measure a factory by units of tractors produced per man hour, but the sales organization by tractors sold, and the customer service group by tractors maintained.
Results comparisons over time periods
A productivity value as stated has no meaning alone. Measure again in a month using exactly the same procedures, or last year, and the values start to have significance as they are compared.
Apples to apples
Comparisons tend to be inaccurate unless they are "apples to apples", with factors the same from one comparison to another. Yet comparisons over time seldom involve purely identical sets of variables. We all know that does not happen, even on this morning’s breakfast or trip to work. Don’t obsess over the lack of absolute consistency because you will never have it; merely state assumptions, calculate carefully, check answers, and use what you find.
One significant variable in productivity measurement is sales volume. Sales volume will always affect productivity measurement; incrementally more volume will cause more direct cost of materials and labor, but usually no more plant managers or corporate aircraft or receptionists. Most companies will therefore convert added sales to better productivity, as well as better overhead absorption and better profits. Incrementally less volume will have the opposite effect.
Busy versus productive
A group may be busy but not productive. If output is measurable but has no value to the business entity, then the group that generates such output may have 100% busy-ness but zero productivity.
Another group may not be always busy but at the same time contribute extensively to the productivity of their overall organization. Examples are maintenance people who keep their equipment in good repair so that they can stand by while operators produce. A busy maintenance person usually means the equipment is not at work and that is bad.
Other groups who should be idle for good overall productivity are security guards, police and firemen.
Preventive maintenance hours may take the place of demand maintenance, and crime prevention and better building codes may take the place of emergency reactions. Costs may be shifted but still be present.
Caveat
Be advised that the results of any measurement, productivity or otherwise, can report only part of the story, the final result; it does not report what caused the result. For instance, the much emulated Toyota Production System emphasizes personal development of line workers and supervisors, which is usually accomplished by training. In a productivity measurement result, training will appear to be unproductive time but would shortly lead to even higher productivity as learned lessons are put into effect.
Jack Greene, Jackson Productivity Research Inc.
Set expectations measure and communicate Results Count - To learn more about this author, visit Jack Greene's Website.
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Kim CastleWith nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation. BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them? If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
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