Productivity is an enduring hot topic among macro-economics nerds and managers in charge of operations, quality, and improvement programs. But current trends—notably remote work, rapid turnover, and the controversy over “quiet quitting”—have gotten more people thinking about what productivity really means and how it should be measured. Some leaders are struggling to set sustainable productivity goals that balance efficiency, innovation, and employee engagement. Further complicating the issue is the challenge of assessing effort put in by remote workers and the need to manage costs in the face of economic turmoil and fluctuating talent pools.
But what is the actual current state of productivity?
The answer, it depends on which lens you look through.
At the macroeconomic level, the U.S. Bureau of Labor reports that productivity (defined as output/hours, or throughput) declined in the second quarter of 2022—to the tune of 4.1% in the non-farm business sector. This includes a 1.4% decrease in output and a 2.7% increase in hours worked. But the current dip follows a 2.2% increase in productivity between 2019 and 2021.
It’s easy for someone worried about quiet quitting to ascribe lower productivity to TikTokers doing the bare minimum at their jobs. But this ignores the fact that hours worked went up, not down. A recent study by Microsoft uses “productivity signals” from across the 365 platform (including hours worked, activity levels, and meetings) to show that employees are working more than ever.
Why are there conflicting views on the state of productivity?
Often the word productivity elicits images of manufacturing floors and warehouses. This is in part due to the 20th century Fordism roots of productivity that emphasize throughput, costs, and efficiency. But some experts question whether this framing makes sense for modern knowledge work.
One challenge is how different groups define productivity. At the macroeconomic level it’s throughput. APQC’s research finds that knowledge workers characterize productivity more broadly as a mix of effectiveness (e.g., quality and customer satisfaction) and efficiency (e.g., cycle time, throughput, and volume) measures. Employees see their productivity not just as throughput, but also as the quality of their work and their ability to invent better work processes and solutions.
In other words: At the macrolevel, productivity is defined as very specific efficiency measure, but when it comes to actually tracking employee productivity, it can get complex. To make things even trickier, many employees also consider intangibles like collective success—taking on additional work to support team or organizational goals—when assessing their productivity.
These conflicting and overlapping conceptions may explain the chasm between how leaders and rank-and-file employees view the current productivity landscape. In a Microsoft survey of 20,000 employees in 11 countries, 87% report they are productive at work. But in the same survey, 85% of leaders say they are uncertain whether employees are productive, particularly in a hybrid work environment.
Leaders may be unsure how to gauge productivity, given that traditional “hallmarks” of productivity—heads down, keyboards clacking, and an office buzzing with energy—are less visible in a distributed work environment. Many organizations are also struggling to get a large volume of new hires up to competency while reskilling existing employees to tackle new challenges. All this makes it difficult to know whether a dip in productivity represents unavoidable growing pains or a longer-term problem that leaders must address head on.
Enter: productivity tools and surveillance software
There’s been a lot of hype around productivity tools, especially as managers struggle to manage in remote and hybrid environments. The typical tools include:
- Email analytics: Tools that analyze communication patterns through email activities (receiving and sending) as well as response times
- Time trackers: Tools that use timers to objectively measure employee time spent on explicit tasks, which allows managers to sort and analyze time spent on tasks per category
- Task and project management apps: Tools for organizing projects and related tasks to create transparency around projects and manage the efficiency of project efforts
- Activity trackers: Tools that provide insight into how and where employees spend their time through keystroke counters, mouse movement trackers, screen captures, and website tracing
Do productivity tools actually work?
The answer is: It depends. These tools are best suited for managing efficiency and “butts in seats”-style measures (e.g., whether employees working in X software program for Y hours per day). But they are not good at capturing the full range of productivity, especially for less transactional roles that involve creativity, critical thinking, mentoring, and offline collaboration. Even more importantly, they can erode employee morale and trust between employee and employer.
This is particularly relevant when employees are already experiencing ennui, exhaustion, and disconnection from what motivates them to be productive in the first place: the feeling that they are doing their job well and helping their team and the organization achieve meaningful goals.
For more information and solutions on the topic check out.
- Understanding Productivity: Where Organizations Go Wrong with Employee Monitoring
- Empowered Employees Improve Productivity
For more knowledge, process, and performance management research and insights, follow us on twitter at @hlykehogland or @LTrees_KM or connect with Lauren or Holly on LinkedIn.