Employee utilisation is how efficiently a company uses its staff to be the most productive they can be. This can be determined by looking at how much time employees spend on specific assignments and tasks as a percentage of their available time on the job.
For many organisations, business is booming making them busy, but yet they still think they can get more out of their team. Frequently, companies struggle to improve productivity and employee utilisation without truly understanding the current state of play. In this blog we discuss ways in which you can analyse the performance of your team to help drive productivity.
Track Your Current Productivity and Utilisation
It’s an adage but, “you cannot manage what you cannot measure”. This is true of employee productivity and utilisation where many variables dictate how productive or how well utilised an employee is. For example, a small business manufacturing and delivering products. What is more productive, an employee who works 8 hours a day on product development, or a similar employee who works 10 hours per day but spends three hours on administration, breaks and socialising. It appears, the eight hour a day employee looks the most productive but we have no idea from hours alone how this impacts the goals and objectives of the business or compares to what the employee was planned to do.
Let’s take the example of a workshop manager, effective utilisation isn’t just about working loads of hours, it’s about how many of those hours are chargeable and billable, but again, if the consultant is missing deliverables and the customer has low satisfaction, then actually how productive are they.
Many professionals who could work less hours than others and achieve target, simply because they are better planners and make more effective use of their time. There are many factors that impact productivity and employee utilisation, however, firstly, and most importantly you will need a grasp of how your employees are currently spending their time. Time and Attendance Software provides a good starting point, allowing you to track employee hours against projects and activities. This is a very simplified argument though, as most employees will have different skill sets, knowledge and experience which obviously mean that there’s likely to be different levels of productivity. However, the data provided by the software will be invaluable in providing you with an understanding of how your employees are currently spending their time, and what proportion is spent on productive activities.
How do you Analyse the Data?
This is where the variables that your software system track are important; categorising the projects will enable you to assess the importance to the business of the work your employees carry out. For a manufacturing business, this may be as simply as chargeable and non-chargeable projects and how it benefits the business.
Defining the status of the different activities performed by your employees will provide an additional level of analysis. Categorising activities as chargeable/non-chargeable or productive/non-productive will provide a good understanding of the quality of work the employees are undertaking and how this impacts the delivery of your projects and services.
Improve Your Planning
With timesheet management implemented, businesses will have a good understanding of what work the employees have performed and how that translates into productivity and utilisation. However, what this information doesn’t tell us is how this compares to what work employees were planned to do. There’s no point stressing that an employee is only 10% utilised on chargeable work if that was what was planned in the first place or if that’s all that your current contracts dictate. One way of looking at this is if you don’t have a plan, your utilisation and productivity figures really do not represent the status of the business, your current workload and the effectiveness of your managers.
There should be number of tools in your production control software such as shop floor data capture (SFDC) which will enable you to schedule your employees on tasks, assignments and/or deliverables, most importantly they provide management with useful information on the planned utilisation and productivity of employees. You can then use this information to analyse key performance indicators (KPI’s). These figures will provide a far more accurate picture of how your employees are performing rather than just looking at actual utilisation. Additionally, planning and scheduling will also help you balance your resources, identify poorly utilised resources upfront as well as identify future skills shortages and training requirements which will all have a positive effect on future productivity and utilisation.
Manage Customer Expectations
Berkeley Myles Solutions is involved in many software implementations and understand one of the most common traps that many organisations fall into prior to implementing a tool or formalising a process is that not enough attention is placed on managing the customer’s expectations prior to delivering the project.
For example, sales people are eager to sell, or may not have the experience to provide realistic estimates or timeframes. Production Controllers have not highlighted the risks, deliverables and acceptance criteria associated with the project. All this leads to an overall reduction in the productivity of the employees during project delivery.
If you ensure everybody involved in the product/service delivery process has a clear understanding of the scope, risks, deliverables and acceptance criteria associated with your projects there is likely to be less project issues, less slippage and fewer budget overruns.
Create a Productive Working Environment
It is important to create a productive working environment where employees can share ideas, tap into each other’s knowledge and limit the impact of any absent resource. This is where some form of project and team collaboration is important, as it is commonly recognised that working together employees can accomplish more
In conclusion, there are five steps on how your business can improve employee utilisation and productivity:
- Implement time recording – “You cannot manage what you cannot measure”, by capturing timesheets you can understand your current utilisation and productivity
- Define appropriate variables – if you sell services you will want to measure chargeable utilisation, ensure you define variables that enable you to measure utilisation and productivity that is applicable to your business.
- Improve your planning – improving your resource deployment upfront should not only improve your future resource productivity and utilisation, it will also give you a more realistic view of the health of the organisation by comparing planned versus actual.
- Manage Customer Expectations – communicate to your entire team the importance of managing the customer’s expectation from initial enquiry all the way through to project delivery. In the long run you will have more happy customers resulting in your employees having to perform less un-productive tasks.
- Encourage Collaboration – boost your productivity by creating an environment where your team members can easily share knowledge, ideas and lessons learned. This will not only improve individual productivity it will help improve project standards and service delivery.
If you are looking to improve your employee productivity then check out our essential guide how to select the right production control system.