Employee Productivity means a balance between all factors of production that will give the maximum output with the smallest effort.
Productivity is an attitude of mind. It is a mentality of progress, of the constant improvement of that which exists.
It is the certainty of being able to do better than yesterday and continuously. It is constant adaptation of the economic and social life to changing conditions. It is the continual effort to apply new techniques and method. It is the faith in human progress.
1. Definition of Employee Productivity 2. Reasons for Low Employee Productivity 3. Roles 4. Factors 5. Behavioral Approach 6. Higher Employee Productivity 7. How to Improve Employee Productivity.
What is Employee Productivity: Definition, Reasons, Roles, Factors, Higher Employee Productivity and Improvement
- Definition of Employee Productivity
- Reasons for Low Employee Productivity
- Roles of Management in Increasing Employee Productivity
- Behavioral Approach of Employee Productivity
- Factors Affecting Employee Productivity
- Higher Employee Productivity
- How to Improve Employee Productivity
Employee Productivity – Meaning and Definitions
Productivity is an economic measure of output per unit. Inputs include labour and capital, while output is typically measured in revenues and other gross domestic product (GDP) component such as business inventories. Productivity may be examined collectively (across the whole economy) or unused industry to examine trends in labor growth, usage levels and technological improvement.
Productivity is defined as under:
Peter F. Drucker opines, “Productivity means a balance between all factors of production that will give the maximum output with the smallest effort.”
European Productivity Council holds, “Productivity is an attitude of mind. It is a mentality of progress, of the constant improvement of that which exists. It is the certainty of being able to do better than yesterday and continuously. It is constant adaptation of the economic and social life to changing conditions. It is the continual effort to apply new techniques and method. It is the faith in human progress.”
While considering an industry as a whole part, the productivity can be expressed in terms of the ratio between the value of the goods and services produced to the value of the resources utilised for this production.
Resources – Evidently the productivity refers to efficient utilisation of the resources.
The resources utilised for production are as under:
1. Land and Building – Land is a place on the location whereupon for constructing and other facilities required for the operation of manufacture are carried upon.
2. Materials – Materials that can be converted into products to be sold. They include fuel, chemicals for using in the process of manufacture, packing and other indirect materials, etc.
3. Machines – Machines are inclusive of plant, equipment and tools essential or required to carry out various operations of manufacture and the transport of materials, heating, ventilating and power plant, office equipment and furniture.
4. Manpower – Manpower implies or includes men and women to do the following perform the manufacturing operations, to plan and control, to do clerical work, to design and to research, to buy and sell.
The use of all these resources combined together determines the productivity of the enterprises. Since, higher productivity means more output from the same resources, it also means lower money costs and higher net money returns per unit of output.
Employee Productivity – Reasons for Low Employee Productivity in an Organisation
Like illness in the human body, there are many causes for low productivity in an organisation.
Some of these are:
1. Low morale of workers
2. Absence of managerial controls
3. Idle machines
4. Low level of output
5. Outdated, old and obsolete machines
6. Slow work, pace
7. Frequent machine breakdowns
8. Improper machine loading and scheduling
9. Missing production schedules and delivery dates
10. Frequent shortage of materials
11. Excess inventory holdings
12. Crowding and confusion in material handling
13. Poor quality of finished goods
14. Large reworks, higher in-process inventory and large accumulation of work
15. Poor house-keeping
16. High cost and low profits
17. Wastage of energy
Any of these systems alone or in combination can bring down productive efficiency.
Employee Productivity – Role of Management in Increasing Employee Productivity
Conscious efforts have to be made for improvement in productivity. In a majority of Indian industrial undertakings, there is vast scope for improving upon various conventional management functions, such as-
1. Design and layout
2. Production planning
3. Scheduling and control
4. Materials management and handling
5. Financial management and control
6. Office systems and procedures
7. Loss prevention and safety
8. Maintenance management
9. Personnel management
10. Harmonious industrial relations, grievance handling, suggestion and reward scheme, etc.
After having explored all the possibilities of improvement in the above functions, it is worthwhile to further organise higher productivity achievement through concerted drive.
Organising for Productivity:
A productivity drive by itself cannot lead an organisation to higher productivity. This urge has to be accepted by all employees. Then only will human efforts aim towards excellence. Once the employees accept the organisational goals, they will be self-motivated to achieve excellence. They would ensure that it does not remain a onetime activity but be a continuous on-going process. Thus, higher productivity will be attained. It is also a collective effort and cannot be left in the hands of a selected few. In industry it is necessary to continue the drive for higher productivity so that the gains once achieved are retained and not lost.
The plan generally drawn and followed to achieve higher productivity is given below:
1. A programme is drawn for creating an awareness in the employees at all levels regarding the need for increasing productivity. This is done through publicity, posters, and group meetings, formation of suitable committees in various departments and a sincere dialogue with the labour unions to win them over to the idea of increasing productivity.
2. Organising brain-storming sessions. Best ideas on any problem are generated when they are perceived from all angles by a group of people from various connected disciplines.
3. Organising training programmes at various levels for educating employees on concepts of productivity.
4. Selection of good projects for study and appointing project study teams with a project leader for each study. These groups should preferably be multidisciplinary in nature.
5. Formation of quality circles in major departments that can isolate problems and suggest their ideas through written reports for bringing about improvements.
6. Inducing employees to form more and more of quality circles in each area of work so that productivity improvements become a voluntary culture, and ideas for improvement are identified on a continuous basis. Nobody knows the work better than the people doing it. The larger the involvement, the more the generation of ideas.
7. Monitoring effectively for early completion of identified productivity projects.
8. Follow-up and implementation of approved suggestions for bringing about an improvement.
9. Developing a system of recognition and rewards.
10. Evolving a scheme to rationally share the fruits of higher productivity.
11. Sustaining the enthusiasm at work.
Employee Productivity – Behavioral Approaches to Improve Employee Productivity
Behavioural approach consists of following techniques:
1. Team Coaching:
Team coaching leads people understand how to work better in a team i.e. with others. It is an effective method for showing teams how to reduce conflict and instead of improving their working relationships. The team can then focus on its real work and achieve its objectives successfully. In order to coach the team, focus must be on interpersonal skills and interactions instead of on individual development.
The important drivers of effective team performance are way people act with their team-mates and the way they communicate with one another. After all, one can put a lot of high-performing individuals on a team. These efforts will yield to higher productivity.
A group method aiming to obtain new ideas about business problems is called brainstorming. A group is organised for sitting together and stimulate greater creativity by exchange of mutual experiences and participating in the discussions. The brainstorming ideas are canalized to a particular segment of product line or services to improve its performance.
3. Problem Inventory Analysis:
Under this method the chief focus is on the problems. The individuals use focus groups to generate new business ideas and strategy. The group discusses a particular problem related to productivity.
The discussions are more focused and related to a particular product and problem suggested by many on the particular product. It is admitted that this method may not give many times an entirely new product idea but it may add to the value of the existing product.
4. Force Field Analysis:
The analysis is the technique to find out what impact a proposed solution is likely to have during implementation. Solutions are subject to a myriad of forces, some supportive called driving forces and some unhelpful and constraining called restraining forces. A situation that is to be changed is regarded as a balance of forces working in opposite directions, i.e., resisting forces and driving forces.
The situation can be changed in the following two ways by:
(i) Increasing the strength of the driving forces or
(ii) Removing or decreasing the resisting forces.
The decision-maker can now utilise the analysis to examine how the restraining factors can be removed or reduced and how to reinforce the driving forces to improve the productivity.
5. Nominal Group Technique:
A participatory approach to the following fact finding (gathering data), identifying problems and strengths, generating ideas (action planning) and evaluating progress is termed as nominal group technique.
It can be used effectively in the following three phases of productivity improvement processes – productivity diagnosis, action planning and evaluation. It also has an indirect advantage in that the frequent, intense participation of organisation members enhances the change process and thus facilitate die implementation phase.
6. Organisation Development:
Organisation development is a body of knowledge and practice that improves organisational performance and individual development keeping in view the organisation as a complex system of systems that exist within a larger system, each of which has its own attributes and degrees of alignment.
The pace with which the process is implemented throughout the organisation depends on various physical and psychological factors these factors are such as the active and skilled use of such techniques as problem-solving groups, job re-design, quality circles, and team building.
Because of this emphasis of human behaviour, introducing changes through OD is mandatorily a learning-by-experience process rather than a purely intellectual exercise. People learn best by doing and an organisational culture is better developed by working on tangible problems than by discussing abstract concepts.
Employee Productivity – Major Factors Determining Employee Productivity
Productivity measured in terms of output per man (or per man-hour) is broadly determined by two principal factors:
1. Technological development, and
2. Employees’ job performance.
Of these employees’ job performance depends primarily on:
(a) The ability of the individual employees (may be called the ability to work),
(b) The motivation of employees (may be called the ‘willingness of the worker to work’) and
(c) Physical conditions of work.
Factor # 1. Technological Development:
Technical factors including the degree of mechanization, technical know-how, raw materials, layout and the methods and techniques of work determine the level of technological development in any industry. Research shows that in industrial plants technological development is by far the most important factor influencing productivity.
Improvements in methods of work and equipment are reported to have shown increases in productivity ranging from 20 to 200 per cent. In marketing firms, on the other hand, the degree of technology will have relatively less bearing on productivity and employee’s job performance will have a more important part to play.
The principal factors in technological development affecting productivity are:
(a) The plant – The size of the plant and the capacity utilization will have a direct bearing on productivity. Production below or above the optimum level will be uneconomical and will tend towards lower levels of productivity.
(b) Research and development – Investment in research and development may yield better methods of work and better design and quality of products.
(c) Plant and job lay-out – The arrangement of machines and positions in the plant and the set-up of the work-bench of an individual worker will determine how economically and efficiently production will be carried out.
(d) Machine and equipment design – Whether the machinery and equipment is modern and is in keeping with the limitations and capacities of people will also determine the efficiency or production and the level of productivity. Higher levels of productivity in foreign coal mines and cotton textiles mills as compared to those in India could be traced to this factor at least in part.
(e) Production processes – Advanced production processes involving the use of integrated and automatic machinery and semi-processed materials have been known to help in raising levels of productivity.
(f) Power, raw materials, etc. Increased use of power and improvement in the quality of materials have a favourable effect on productivity.
(g) Scientific management techniques – Better planning of work, simplification of methods, work simplification, time and motion study, emphasis on need for reduced wastage and spoilage are some of the contributions of the scientific management movement to the cause of higher productivity.
It will be realised that technological development in an industry will depend not only on the general economic and technical environment in the country but also on the availability of capital stock or financial resources. This makes capital a crucial factor in productivity. It also needs to be recognized that technological development will influence employees’ job performance also. With better machines, tools and processes, both the ability and the willingness of the employees is likely to increase.
Factor # 2. Employee’s Job Performance:
The human factor is a critical factor in the success of an enterprise or an industry. The human side of an enterprise is its dynamic part; good machines, improved methods of work, new processes, in short all improvement in technology, calls for willingness and action on the part of the men in industry to serve as agents of higher productivity.
Employees include men at levels of organisation right from the rank-and-file workers up to the top-level executives. That the employees’ attitudes and performance have an immense bearing on productivity is well brought out by the fact that Scientific Management techniques have not brought about the promised levels of productivity mainly because of indifference and hostility of the workers to the basic philosophy underlying such techniques.
Job performance of employees is broadly determined by three factors:
The ability of an individual employee to perform well on his job is of fundamental importance in productivity. Certain personal factors govern this prerequisite of higher productivity. These include knowledge and skill. Knowledge is acquired through training, education and interest on the part of the learner.
That shows how important education is for higher productivity. Skill is affected by aptitude (one’s capacity to learn a particular kind of work), personality (emotional maturity, balance, etc.) as also by education, experience, training, etc. A person who is deficient in knowledge and skill is likely to be less productive than a person who is normal in these respects. Other things remaining equal.
The willingness of the employee to work for an organisation is related to his productivity in an important way. The urge to work is a complex phenomenon governed by several factors. The motivation of an employee will depend upon the organisation structure (formal as well as informal), leadership, need satisfaction and the influence of trade unions.
Delegation and decentralization of authority, participative management, and organizational efficiency, proper personnel policies relating to selection, placement, promotion, wage-salary levels, incentives, merit- rating, job evaluation, training and provision for two-way communication are some of the features of the formal organisation which influence motivation.
Likewise, the existence of groups with higher productivity as their goal is likely to contribute to the organizational objectives. This is a fact that was brought out by the Hawthorne Researches in the U.S.A. The proper kind of leadership depending upon the task and the men involved and favourable attitude on the part of trade unions also help in motivating people to work for the goal of higher productivity.
Although job satisfaction is not necessarily a motivator to higher productivity yet it does prepare the way for motivation. Employee motivation will depend also on the general economic conditions in the country of the region and the personal situation of the individual.
In emphasizing the role of motivation in improving job performance and productivity, it must be noted that neither motivation nor ability can by itself ensure high levels of job performance. Research shows that job performance results from “ability time’s motivation”.
A person may be very capable but if he is not motivated, he cannot perform well on his job. Likewise, a person may be highly motivated, but if he lacks the basic ability required for the job, he cannot do well. This is a point that is generally overlooked in stressing the importance of motivation in particular.
(c) Physical Conditions of Work (Work Environment):
The importance of a proper work environment and physical conditions on the job has been emphasized at length by industrial psychologists and human engineers. It is important that the work environment ensures the greatest ease at work through better ventilation, better lighting, improved safety devices, reduction in noise, etc. Equally important is the need for making the workday reasonable in length, and for introducing suitable rest pauses to enable the men to recoup their energy lost in continuous work.
The Hawthorne experiments showed that physical conditions of work were not directly and necessarily related to output. What really matters is the attitude of the employees toward these conditions. Thus, if the workers feel that a particular job is unpleasant and dirty and the management has done its best to make it as less uncongenial as it possibly could, this will not have an unfavourable effect on motivation and job performance.
At the same time, certain studies made in England show that when the temperature gets beyond reasonable limits, this did tend to affect output even when the workers had high ability and high motivation. In any case, the management cannot run away from its obligation for providing the most congenial possible working conditions to the employees.
Some other Factors of employee productivity are as follows:
1. Individual Factors:
Individual factors are the factors that are possessed by an individual as integral parts of his body and hence cannot be detached from it examples are knowledge, skill and attitude also affect the productivity of industry. Knowledge is acquired through training, education and interest on the part of learner.
Skill is affected by aptitude (one’s capacity to learn a particular kind of work), personality (emotional maturity, balance of mind, etc.) as also by education, experience, training, etc. Increased knowledge, skill and aptitude certainly increased the productivity and a person deficient in these personal attributes is less productive than an average man.
2. Organisation Factors:
Organisation factors are inclusive of the various steps that are taken by the organisation towards maintaining better industrial relations these factors are like delegation and decentralisation of authority, participative management, workers’ participation in the management, organisational efficiency, proper personnel policies relating to selection, placement, promotion, wage salary levels, incentives, merit rating, job evaluation, training and provision for two-way communication, supervision, etc.
These factors also influence motivation.
3. Work Environment:
The significance of proper work environment and physical conditions on the job are emphasised by industrial psychologists and human engineers. Better work environment certifies the greatest ease at work through the following better ventilation and light arrangement, improved safety devices, reduction in noise, introducing suitable rest-pause, etc.
4. Other Factors:
Some other factors that affect productivity are as under:
(i) Government Policy – Government policies towards the industry also make to industrial productivity. Taxation policy, financial and administrative policy, tariff policy and protection policy affect the productivity to a large extent.
(ii) Managerial Factors – The industrial productivity is influenced largely through managerial ability and leadership. To illustrate the managerial ability of utilising the available resources to the maximum, organising capacity, foresightedness, decision-making ability and entrepreneurship are certain factors that contribute to entire productivity.
(iii) Natural Factors – Natural factors comprise of the physical, geographical and climatic conditions they influence the productivity at large. Abundance of natural resources affects the productivity in positive way and vice-versa. In the same way climate affects the efficiency of workers to a great extent.
Employee Productivity – Contribution of Employees Towards Higher Productivity
When the factors affecting the productivity are managed properly the situation becomes favourable. The affecting productivity may include working conditions, technology, training of employees, motivation, leadership, favourable rules, regulations, policies, management attitude and career development opportunities. When these are managed properly, these create interest to work and give the best of the capacity.
The employees’ problems are reduced or finished. The workers take their responsibility to perform. The unwanted time and activities are saved and in turn these save the time to give more output. Accidents, wastes and reworks are avoided. This improves the quality and quantity of the output per person. With the same input the output and quality of the output go higher.
These in turn directly contribute to achieve the performance standards and targets. When, these products or services are sold in the markets the customers use these and get the perfect functions from them. It leads to satisfaction of the customers. The satisfaction of the customers is very valuable for the business organisation. The satisfied customers repeat the purchase of same products or services in future. The customers are retained.
Further, they make the publicity by words of mouth to their family members, friends, relatives and colleagues. It leads to enhance the sales of the company. The company market share increases. The higher sales contribute in increasing the profits of the company. The employees due to their higher productivity get higher salary packages, incentives, promotion opportunities, bonus, welfare-facilities, etc., from employers.
The living standard of the employees improves. The organisation as a whole earns profits every year and it leads to the progress of the business. The employees and business organisations are part of the society and national economy. Finally, they all contribute in development of the national economy. So the importance of higher productivity can be understood.
Specially, in the tough competitive situation the management is very much concern to improve the productivity of every employee, system, machine and unit for survival, development and excel in the business. If not taken care of it is going to affect adversely.
In underdeveloped countries the labour productivity is very low. The salary packages paid to the workers is also very low. In developing countries the efforts are being put to increase the productivity, the profitability of the organisations are going high. The salary packages of the employees are of average level.
This situation prevails in India, Brazil, Argentina, China, Malaysia, Indonesia, etc. In developed economies the profitability of the organisations is very high due to higher productivity. The employees are also paid higher packages. All these are contributing the development of the national economy. Here we have examples of USA, United Kingdom, France, Japan, and Germany.
Employee Productivity – How to Improve Employee Productivity (8 Important Steps)
Productivity improvement is the concern of everyone who ever is related to the work. The may be employee, team, division, department, organisation and government for national economy. There is no doubt that the productivity can be improved and further it can be maintained also if proper and timely care is taken. In the competitive situation only the company giving good performance through products and services stay in the market.
It has become very difficult to grow, stabilize and excel in the performance. It is only through good performance and higher productivity. For improvement of productivity different academicians, practitioners and managers have suggested many points. These points or concepts are very simple but the implementation of these points is not very easy.
A lot of efforts and attention is needed. In implementation the changes are to be made as per the situation, rules and regulation, available resource and employees.
The productivity improvement process should have the following steps:
Step # (a) Setting Mission of the Organisation:
To give the clarity regarding the objectives of the organisation is very important. If it is clear in the mind of people what for the organisation is in the business and where it wants to reach in due course of time, accordingly the employees will understand and work. To fulfil the objectives of the organisation the goals are to be decided. It should be clear in mind of everyone.
The goals are to be finalized in joint meeting of management, union and employees. There should be acceptance from all parties for smooth functioning. The goals setting should be realistic and should not be very high to achieve. Special care should be taken and the consultants and internal experts should be consulted.
This will take everyone into confidence and objections would not be there in future. This contributes in mental preparation of the employees and managers. It would provide the clear guideline to the employees and the sense of commitment would develop.
Step # (b) Setting Goals and Performance Standards:
Once the company’s mission and objectives are set then these are to be achieved. The organisational objectives would be divided into divisional or departmental objectives. To achieve each objective the goals are to be decided. These goals or targets are to be decided with reference to a point of time. Further, the departmental objective should be divided into individual objective and goals.
Individual goals are to be decided in consultation with the employees and their acceptance is necessary because they have to achieve the goal they agree. To achieve the goals next is deciding the performance standards. These are to be decided by the top management in discussion with the departmental heads and employees concerned.
The performance standards include the quality and quantity, cost, level of responsibility to be fulfilled, leadership quality, initiative for problem solution and discipline.
Generally, performance planning is often neglected at the department and individual levels. Employees need to know how and how much they can contribute in meeting the company and department goals. They should be given opportunity in developing the plan for productivity improvement. The management should meet the employees at regular interval and discuss regarding their performance, difficulties faced during the work and get the other inputs.
This can contribute in motivating the persons to take the responsibility to meet the performance standard for achieving the goals. The goals and performance standards should be properly and timely communicate to everyone without any delay. During the job performance the employees should be counseled, coached and performance feedback should be given.
This would help in overcoming many difficulties faced during the work. The performance planning and time-to-time review of the performance should be carried out. It would pinpoint the deviations in performance and planning done. If any deviation has taken place in the performance then the employees can be guided, trained and helped so that the performance should not be affected.
During the performance period and at the end of the year the performance appraisal should be conducted. It should be fair and unbiased. This would be very helpful for identification of new talents, development and remedial actions.
Step # (c) Motivate Employees:
For getting the desired performance from the employees they should be taken care of properly. Their motivation is very important.
There are different methods of motivation of employees:
The management should understand the importance of motivation methods and where these can be applied. The employees should be properly selected and placed on the jobs. They should be trained on the job before assigning the job responsibility. During the job if any new procedure of technology is replaced then they should be trained properly. They should be placed in good salary package so that their monetary requirements can be fulfilled.
In addition to salary they should be provided with performance incentives, welfare facilities, bonus, promotion, job and social securities. These facilities would contribute to retain the trained persons in the job. It is difficult to get a good employee but it is more difficult to retain and maintain the employee. The trained and motivated person can contribute a lot because he is happy and committed person.
Further, the managers and supervisors should have frequent discussion between then regarding the goals, performance standards, emerging trends in the market and the competitive situation prevailing in the industry. They would make up the mind of the employees in line with the requirement of the organisation.
Management must develop the habit to listen the points suggested by the employees and timely action should be taken if the suggestions are proper. The employees should be informed that everybody is useful in the company and nobody is inevitable. Their contribution is valuable in achieving the goals of departments and organisations. Communications must be frequent, clear, and positive and must come from every level of management to the employees.
It should be properly informed that the performance of everyone would be considered and it would not go unnoticed. The good performers would be rewarded accordingly. The poor performers would be tried to improve their performance also. Further if not improved despite of repeated sincere efforts the remedial actions would be taken.
The performance review should be carried so that the planning, development and correcting actions can be initiated. The higher performance should be considered to higher pay increase, incentives and rewards, the poor performances should be treated for wage cuts, denying facilities and dismissal.
Success and achievements of the company should be highlighted to everyone and they should be thanked accordingly. The team-spirit and their contribution should be acknowledged. All these steps would get the high level of commitment of employees towards the company and its objectives.
Step # (d) Identification of Strengths and Weaknesses:
In almost every organisation the demographic situation of employees is changing with the time. In past, the more number of males were working in the jobs. Female were interested only for household activities or were not cable to do the other work. With the changing time the demographic scene has undergone a drastic change. Due to development in education more number of females getting education and they started coming in jobs.
Now at national and international level the percentage of female employees is increasing. People are coming from different caste, creed, region, religion, language and sex. The diversified workforce is now available in most of the companies. All these people are having their own strengths and weaknesses. These strengths and weaknesses are to be identified. The strengths can be utilized and weaknesses can be overcome by timely remedial actions.
The employees are to be selected out of the lot applied on the basis of their merits. The weak candidates are to be denied and capable should be taken by considering the strengths. During the work the performance appraisal would help to find out the strengths and weaknesses of every employee. The potentials can be identified for new future jobs or higher responsibilities.
The employees’ strengths can be considered in assigning the new jobs or assignments. The management would take the corrective action to overcome the weaknesses by guiding, coaching, counselling, training, etc. By doing all these, the performance of the employees would be higher.
And once the performance of employees improves the required resources are used effectively to give the output. The productivity automatically goes high. The objective of performance and productivity improvement can be achieved. The leading companies in the market got the success in this area to a good extent.
Step # (e) Training and Development of Employees:
Training is the process of imparting the knowledge and skills to the persons. It gives knowledge and skills and in turn these give confidence to the person performing the job. The confident persons perform the jobs in a better way. The performance and productivity both improves. If the persons are not trained on the job then they do not know the basics of the jobs.
Many difficulties are to be faced in understanding the doing the jobs. Many problems are likely to be faced. These cannot be overcome easily. The time, efforts and money all are wasted. To avoid all these, the importance of training is felt in the beginning and during the job also.
The development facilities also should be provided to the employees in their career. Training and development activities are to be conducted regularly. The employees should be trained on the job and they should be provided training for improvement of productivity also.
Productivity-oriented training should focus on setting objectives, performance standards, leadership quality in group problem solution, job knowledge and skill and communication. Similarly, the supervisors and managers also should be trained for productivity improvement. The productivity-oriented training should be designed as per the jobs and requirement of the company. It is not going to work for all jobs and industries. It should be tailor-made according to the specific requirements.
The training responsibility should be assigned to the supervisor or manager in-charge. They should identify the need for training of different jobs and then the training should be conducted. Further the effectiveness of training system from productivity improvement point of view should be reviewed. The steps should be taken to improve for future requirements also.
Step # (f) Performance Appraisal:
The objectives, goals, objectives and performance standards have been fixed through mutual discussion. These are properly communicated to all employees. They are properly guided and trained on the job for giving better performance. Whenever they face problems on the job they are helped by their supervisors and managers. Further, it becomes necessary to measure their performance during the year.
Once it is measured it can be managed also properly. The supervisor should conduct performance appraisal in mid and end of the year. The quality, quantity, cost involved in production, level of involvement shown, competencies exposed, initiatives taken for problem solution and leadership quality shown in guiding or helping the others and problems faced during the work. All these are to be measured.
On the basis of this measurement the management would get the clear picture of the responsibility fulfilled, level of performance standards achieved, available of potentials, strengths and weaknesses, behaviour at work, etc. This appraisal would give the timely reporting to the management regarding the performance achieved to accomplish the objectives. Here the focus is more on result rather than activity.
On the basis of performance appraisal or measurement the other management decisions like rewards, incentives, pay increments, promotion, demotion, training, bonus, welfare facilities, etc., would be taken. This would help to channelize the efforts to improve performance and productivity of employees so that the objectives or goals of the organisation as a whole can be achieved effectively and efficiently.
Step # (g) Future Planning, Development and Corrective Actions:
On the basis of performance appraisal the management would get the clear idea whether the objectives of the organisation are fulfilled or not. If it is done so then the existing situation is to be maintained. If not then to improve the situation the planning is to be done for resetting objectives, goals and performance standards. These are to be aligned in line with the emerging trends in the market and competition.
If the competency level of employees is not found up to the mark then training and development programme are to be implemented. Through this the knowledge and skill of employees would improve and this would contribute in improving the performance and productivity.
Further, the employees those who have given good performance and higher productivity, they should be motivated further to continue with the same level of performance. If they are not motivated then they would also do the work like others. Higher performers should be selected and given incentives, rewards and recognition, etc. Their case should be considered for higher pay increase, promotion and bonus.
Those who are not improving their performance despite of repeated efforts of management; they should be denied increments, bonus, promotion and other facilities. They should be motivated by fear of wage cuts, demotion and dismissal. These practices are being utilized in leading companies in India and abroad. In addition to these a lot of other innovative techniques can be utilized to motivate them to give higher performance and higher productivity.
Proper and timely actions are needed on the part of the management for productivity improvement. There is no hard and fast rule and only on technique would work for this purpose. These may work in combination but it is difficult to specify which technique has contributed for productivity improvement over a particular point of time.
Step # (h) Performance Improvement Plan:
The performance improvement plan is to be prepared and implemented timely and properly. The importance of improvement plan should be communicated to everyone. They would have the clear idea where it is going to be used and what would be its impact in future. The performance is measured and timely the feedback is communicated to employees.
This would reply to the questions of employees in their mind. If plan awareness is not created then they may not take interest in work because they do not know the uses of improvement plan. The employees should be communicated regarding their importance in accomplishment of objectives of the organisation. The business of the company is due to the performance of employees.
Better performance means better business. They should be taken into confidence and then the performance plan is to prepared and implemented. This would be in a position to get the whole hearted support of employees and in turn the productivity and performance both would increase.
The productivity improvement programme can be planned and implemented with the initiative of top management. It needs time and efforts to perform. The quality of leadership matters a lot to bring the changes in the mindset of employees. It should be driven by the top management. Top management should understand the importance of better quality of performance in the competitive situation. If the management is determined then the directions can be given to the other managers and employees.
“The management can take the help of internal as well as external (consultants) experts.” Sometime the personnel managers may oppose this move because they have to do a lot of work for this programme. They should be properly convinced. If it is done then willing support is likely to come from every one. The productivity improvement plan can be prepared and implemented properly. The expected level of productivity can be achieved. The performance management process is to be applied on continuous basis so that the continuity can be maintained further also.
Many academicians, consultants and practitioners have advocated for different point in this direction.
Mainly William J. Stevens suggested the following steps to improve productivity:
(i) Develop productivity measures for all operations.
(ii) Look at the system as a whole and overall productivity is more important.
(iii) Develop methods for achieving productivity improvement and timely review them also to keep than tuned in line with organisational requirements.
(iv) Establish reasonable goals for improvement which can be achieved.
(v) Make it clear that management supports and encourages productivity improvement.
(vi) Consider incentives to reward workers for contributions.
(vii) Measure improvements and publicize them.
(viii) Don’t confuse productivity with efficiency. Efficiency is a narrower concept that pertains to getting the most out of a given set of resources; productivity is a broader concept that pertains to use of overall resources. For example, an efficiency perspective on mowing the lawn given a hand mower would focus on the best way to use the hand mower; a productivity perspective would include the possibility of using a power mower.
While taking these steps the company should not focus mainly on productivity but other factors like quality, timing, innovation, market competition and strengths and weaknesses of the company.