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How to Increase Productivity Simply by Measuring Work Time

By: John Malmo

John Malmo began an advertising agency on a cardtable above a delicatessen in 1967 and built it into the largest in the mid-south. He also owned a travel agency, a clock shop, and a snack food manufacturing company. He is president of Koenig, Inc., Management Consulting, specializing in marketing, and he writes a weekly business commentary column for The Commercial Appeal. His 45 years of marketing experience encompass, virtually, every business category. Email him at: jmalmo@archermalmo.com

In 1867 Karl Marx espoused an hour’s work as the measurement of value. While it’s clearly not, necessarily, always a true measurement of value, it’s a whale of a measurement of cost.

Even at the Millenium, the feds’ still measure the economy’s productivity in goods and services produced per hour of labor.

In factories and many service businesses worker time is measured down to the second per unit of production or service. In most offices few companies even try. They just look at some total sum and stash it under something like “general and administrative” cost. Then they wonder why G&A keeps going up.

It seems appropriate in this age of American productivity bashing that each businessman and woman ought to devote oneself to the pursuit of increased productivity. The No. 1 prerequisite of increasing same is the necessity to first be able to measure productivity. In a building jammed with white-collar folks that’s not easy.

Consider the primitive timesheet

In behalf of productivity, profitability, progress, prudence, and downright preservation of business, consider the primitive principle of the daily timesheet.

In personal service businesses, like accounting, law and advertising, most work is sold by the hour, and everyone keeps a daily timesheet, in quarter-hour increments. There are as many arguments against the practice as there are workers, but for those who have kept daily timesheets for most of our business lives the arguments don’t stand up.

First, consider some of the fundamental barriers to increased productivity. In too many cases there is no distinction between work (activity) and productivity (achievement). Take meetings. While meetings could be defined as work (activity), meeting time often is not acquainted with productivity (achievement).

Achievement is generally what is accomplished by individuals after they leave a meeting. If you don’t believe that, ask yourself if you’ve ever said or heard, “I didn’t get anything done today. I was in meetings all day.” Case closed.

During the current “slow down” we have read of thousands of layoffs of white- collar workers. Usually, these layoffs are neither caused by, nor do they have any effect on, the amount of “production” in those offices. They simply occur because costs have to be cut, the work of three workers is shifted to two, and, miraculously, the same amount of production results.

Who’s carrying the load?

It would appall a lot of people if they could go over the previous week’s timesheets of other workers. You start with some idea of what got done that week, but now you’d have another equation, a good idea of who did it.

Several good, and specific things, happen. There is immediate accountability. You find out that some guy spent eight hours writing a letter. Honest. He makes $80,000 a year plus benefits. That letter cost about $400, not including any secretarial time, paper, envelope, postage, etc. Maybe it was worth it, maybe not. At least now you know how much it cost.

Another curious thing occurs. When someone starts filling out timesheets, that person is the first to know the score. And a 5 o’clock timesheet with only one legitimate 45-minute entry for the eight-hour day strikes sheer terror in the heart of somebody who wants to keep his job. The mere presence of timesheet discipline, itself, can have an enormous effect on productivity without the boss saying a word.

Few employees welcome the measurement of individual productivity. It’s a primary reason why labor unions consider payment on a piece-work basis dirty words. But in the long run, while weeding out under-producers (those mountains of activity and molehills of achievement), it also increases self esteem and confidence among the most productive personnel.

A management tool

Timesheets are an extraordinary management tool to increase productivity simply by measuring it. Businesses that “buy time” from their employees and re-sell it to customers could not survive without timesheets. Businesses that don’t charge thusly still find that they are more profitable, benefitting from the discipline and measurement created by timesheets.

Even though a business may not charge by an hour’s work unit, it’s certainly shelling out for it on that basis. And if it’s a cost, it has to somehow show up in the selling price, and the bottom line.

If timesheets do nothing else, ultimately they slash meeting time. Try walking out of a three-hour Tuesday meeting with six other people and the realization that the only decision reached was to meet again Wednesday. Then look at the timesheets and see that the meeting cost the company from $1,000 to $2,000.

Now that’s scary.

© Copyright 2000 John Malmo

Other Articles by John Malmo

The author assumes full responsibility for the contents of this article and retains all of its property rights. ManagerWise publishes it here with the permission of the author. ManagerWise assumes no responsibility for the article's contents.

 

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