How to measure productivity and avoid focusing on vanity metrics

How often do you think about your productivity levels? Does it only pop up in your mind toward the end of the year or maybe when the audit season is right around the corner?

If your answer to that question is ‘yes’, then you aren’t thinking about it enough…

Improving your productivity is a continuous effort that requires a series of testing, experimenting and optimizing. It doesn’t happen overnight.

So how do you improve your productivity?

Well, there are many ways to go about this process. But a good way to start is by measuring your current performance—and more importantly, measuring with the right set of factors.

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So in this article, I will highlight examples of clear metrics to measure productivity and how you can use them to bring your productivity levels higher.

What are productivity metrics?

How do you measure your success? How can you tell whether the strategies you’ve implemented have driven a positive impact and boosted your company’s performance?

This is where productivity metrics come into the picture.

Productivity metrics are all about measuring two aspects of how your business is performing: effectiveness and efficiency.

Are the resources you are investing in company operations bringing about satisfactory returns? Could the time or manpower used be redirected to preferably high-value activities?

By identifying the strengths and weaknesses of the processes in place, productivity metrics can help correct the flaws in the execution of your business plan and boost your returns.

Whatever the case, you have to choose metrics that drive real impact and are not a false reflection of your success. Vanity metrics will do no good for your business in the long run.

Why you should steer clear of vanity metrics

Think about all the time you’ve spent collecting data and putting together your insights. Imagine discovering at the end of that venture that none of your data can be put to effective use. Why? Because of vanity metrics.

Vanity metrics are as the name suggests: for show. They exist to make your business performance look good to your stakeholders but provide little to no actual value in building your business success.

Vanity metrics may often be used to window-dress your business and make it look like it’s performing better than it actually is. But they aren’t actionable in any way if not followed through with proper analysis.

Vanity metrics are often those that are:

Very simple/easy to measure
Misleading
Easily manipulated
Produce insights that can’t be followed up on

Some examples of productivity related vanity metrics could be:

The total number of customers: this number is subject to fluctuations but unless you use it together with other metrics like customer ratings or spend per customer, it can paint a false picture.
The total downloads/sales: the number can only increase over time but looking at the rate of increase or growth trends can be more insightful.
Total hours worked: you might think the higher the number, the more you’ve achieved but this can be very misleading. Burning the midnight oil doesn’t always translate to efficient working.

Therefore, using vanity metrics is a bad idea. It can paint a wrong and misleading picture and prevent you from confronting and resolving issues with your productivity.

Examples of effective metrics

Rather than vanity metrics, focus on building actionable metrics.

Having defined metrics in place will not only help to increase your productivity levels but also create a roadmap of what you want your business to achieve in the long run.

Depending on your business, the key metrics you work with may change. For example, a freelancer or consultant may opt for project-delivery or client-based based metrics versus an online retailer who would focus on sales metrics due to quick turnover periods.

Listed below are examples of a couple generic but effective metrics you can start out with to measure productivity.

Productivity Metric	Functionality
Labor-based metrics(e.g. overtime hours)	Overtime hours dedicated by employees is one way to measure their output. For example, seeing a spike in overtime hours during a busy season is expected. If overtime hours are high due to increased workload, you might want to think about hiring more manpower. Sometimes, unnecessary overtime hours can also point to inefficiencies by employees who may require re-training or are not performing on par.
Sales-based metrics(e.g. revenue-focused KPIs)	Depending on the nature of your business, these may vary. For example, anything from the number of new clients acquired to deals closed. The higher the sales KPIs, the better. It’s a good idea to compare these to input-based metrics to compare the results vs. efforts put in.
Customer-based metrics (e.g. customer satisfaction levels)	At the end of the day, if you’re not ranking high on customer satisfaction, a productivity audit is in order. These include key metrics that deliver a good customer experience. For example, the number of client issues solved and customer response rates. It would help to have a customer data system in place to help collect customer data.

Once you’ve figured out your productivity metrics, it’s time to start measuring…

Improving your productivity based on key metrics

Step one: Identify your areas of improvement

Before you can take the steps to raise productivity levels and identify the metrics to focus on, you first have to identify what you can do better.

It might be easy to think, “I have to improve my work performance” but identifying the specific areas that can drive the most impact requires an assessment.

For example, if you’ve identified that an abundance of valuable hours are being spent doing one thing, you may want to find ways to work less and increase productivity. Or maybe customers have expressed dissatisfaction with your response timings.

As highlighted under the types of metrics you can utilize, there are similarly a number of areas you can improve in.

Your first step should be to track, measure and assess your current work performance to identify the areas that require immediate attention.

Ways you can do this include:

Integrate audit tools into your channels to find in-efficiencies. For instance, with emails there’s tools to track email opens, clicks, and even the delivery rate.
Assign target times/resources by using a task-based approach and identify where too much is being spent/invested
After the assessment, period has passed (for example, two weeks or a month), export your data and evaluate your current work performance against your defined metrics

Step two: Form strategies in line with your goals

You’ve identified where you’ve been lacking in productivity and now it’s time to be proactive and take the steps to turn things around. Think: strategies.

Creating strategies that are in line with your greater goals is important. For example, if the goal in mind is to increase market share by 10% by the end of the year, then building a strong sales funnel could be a strategy you adopt to do so. Throughout the process, keeping your sales-based productivity metrics at top-of-mind will ensure you’re focused and working in the right direction.

It is important that you create strategies that are clear and leave no room for miscommunication at this stage. For this, you can use the SMART approach and align the strategies with your goals, using relevant metrics to measure your performance.

	S.M.A.R.T	Goal Example	Relevant Productivity Metric
S	Be Specific	I aim to grow my revenue and cut down on costs.	Sales-based metrics: number of deals closed/sales made.
M	Make your goals Measurable	I want to boost revenue by 15% in line with cost-cutting activities.	Sales-based metrics: has ROI increased?
A	Make your goals Achievable	I will use existing resources more wisely to achieve this.	Labor-based metrics: have the hours worked reduced? Is there more overtime being charged?
R	Goals should be Relevant to your business’ mission	This goal will help me to grow my market share and make my product/service more accessible to customers.	Customer-based metrics: customer ratings and qualitative feedback
T	Goals should be Time-Based	I will achieve a 15% increase in revenue by the end of this quarter.	Labor-based metrics: employee hours spent on revenue-boosting projects

Breaking down your goals and strategies while keeping your metrics in mind can help you form a clear plan of action that will ultimately boost your business’ productivity and profits.

Step three: Implement and review your strategies regularly

“My work here is done!”

Or so you might believe after implementing your strategies but improving your productivity is a continuous process. It doesn’t end after execution.

This is where reviewing and assessing your business performance comes in. The audit process is like a well-oiled machine. Even if you’re not carrying a productivity audit actively, you have to be aware of your metrics and need to improve performance.

Here are a few tips on how you can keep on top of your productivity after rolling out your strategies:

Set a defined timeline for your productivity audits (for example, every quarter)
Keep records of your old data and compare them with new results to identify where you can change up your metrics
Continue to evaluate your metrics against the SMART goals to identify new strategies

Sometimes, you might perform better than you expected. In that case, kudos to you! Use your success as positive reinforcement to find what worked best and replicate that growth for the future.

Other times, your metrics may not shine as much as you expected. Here, conducting an audit and identifying what went wrong can help you fine-tune a strategy that can turn things around for your productivity later.

Post-audit productivity hacks

Although managing and improving your productivity is a long-term oriented process, here are some basic things you can do to generate results faster.

Stop multitasking

Believe it or not, multitasking is not a proven solution to boosting your productivity.

Think about it logically: if you’re splitting your attention and energy between several things, aren’t the chances of slipping up and making mistakes in one task higher?

Here are the problems with multitasking:

You lose focus and sight of the bigger picture: you’re only being ‘fake’ productive and fooling yourself into thinking you’re achieving a lot when you’re not making much progress in any one area.
You invest time the wrong way: multitasking can make it difficult for you to keep track of what you need to do. You’ll end up pouring longer hours on tasks that could have completed more efficiently had you focused all your attention on it.
You will lose energy: multitasking provides a temporary gratification by giving you a false sense of productivity. The pressure to do more in little time can lead to a build up of stress and burn you out.

Adopt a focused uni-task approach that can boost efficiency, avoid errors and ultimately make you more productive.

Manage your work on a timely basis

If you think pouring in more hours equates to productivity, you couldn’t be farther from the truth.

Everyone is granted the same amount of time to do a certain task but the people with good time management practices are the ones who achieve the most in those hours.

Establishing and optimizing a workflow and processes that are in line with your day-to-day goals can help achieve this.

Using time management tools like Time Doctor or Google calendar time trackers can increase your productivity. Keeping track of your to-do lists, managing critical versus low-priority tasks and cutting down on distractions can make a significant difference to your metrics.

Leverage tech-powered apps

Tech-powered apps or even if you want to build your app yourself are an available solution to help you manage and streamlining your processes in order to boost productivity.

Earlier, in your productivity audit, you may have identified areas of work that are repetitive and manual in nature. Automating those activities with tech tools can aid coordination and boost productivity in the long run.

There are a number of productivity apps on the market for this purpose.

Conduct audits on other areas of your business

Once you’ve conducted your productivity audit, you may have a high-level picture of which areas require improvement. What can help you get to the root cause of performance-related issues is further in-depth audits into these functional areas.

Imagine this: you conducted a productivity audit and one of your insights reflects that haven’t been meeting the forecast revenue targets after implementing recent marketing campaigns.

What can you do next? Conduct an audit on the marketing function of your business. For example, if the marketing campaign that didn’t follow through was digital in nature, you could carry out an seo audit (Perhaps, leverage audit tools for further efficiency).

Understanding your business’ marketing collateral and which areas are lacking can then help you take the steps necessary to improve your marketing function and as a result, raise your productivity levels.

Bring the pro to productivity

Productivity plays an all-pervasive role in your business.

It filters down to the day-to-day tasks you do while also impacting the strategic initiatives you take on.

This is why it’s essential you have the relevant productivity metrics to assess your business’ performance and help you grow.

Once you integrate these metrics into your goals and strategy setting operations, you can take a conscious step to boosting your performance in every task you deliver.

So what are you waiting for?

Put your productivity metrics under the microscope and start paving your business’ path to greater future success.

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