Productivity in the workplace relates to how efficiently your workers accomplish your company's goals and produce goods or services for customers. Examples might include the speed at which your workers produce a product at a factory, handle technical support calls for a tech firm or serve customers at a restaurant. Keeping workplace productivity high is important for helping your company reduce its costs, satisfy its stakeholders, expand its operations and stand out in a competitive marketplace. By understanding common causes of low work efficiency, you can coach your employees on work expectations, streamline business processes and foster higher morale among your workforce.


Workplace productivity refers to how efficiently your company's workforce produces an output. You may calculate this in terms of labor productivity or total sales productivity.

Meaning of Workplace Productivity

Workplace productivity typically describes the amount of work your staff can do within a certain number of hours or amount of labor cost. An easy way to calculate it is to divide your total output by total input. Input will include labor hours and other resources used in the work process. There are two ways to calculate productivity that may fit your organization's needs. If your company produces a good or offers a service, you can find your overall labor productivity by dividing the number of goods or services produced by work hours. If you run a sales firm, you might instead divide net sales by work hours to see how much in sales your company generates for each hour of work.

Benefits of a Productive Workplace

A productive workplace not only benefits your workforce but also customers and investors. When your employees manage their time and produce work without defects, you get a greater output for your labor and materials costs. This ultimately increases your profitability, reduces waste and satisfies your investors. In addition, employees tend to feel better about their work and have better morale in a productive environment. This can lead to employees providing better customer service, attending work regularly and staying motivated in their work. Customers benefit when your company can produce enough output and provide excellent service.

Effects of Low Productivity

When your workplace is not productive, you'll usually see a negative financial impact in the form of higher costs for labor and supplies. For example, your employees might take longer to complete one task or create one product, and resulting in a lower output of goods or services. Low work efficiency also harms your company's competitiveness and can cause its place in the market to suffer if your competitors create more value at a lower cost than you do. Low productivity is also a common sign of low employee morale, which can cause your workforce to show increased absenteeism, negative behavior, lower quality work and higher turnover.

Causes of Low Workplace Efficiency

Your workplace can suffer from low efficiency if employees lose sight of their role in helping the company meet its goals and are unclear about expectations. Low work efficiency can also occur due to ineffective management, including when managers micromanage their employees, do not delegate assignments appropriately or have unrealistic deadlines for assignments. The organizational culture can also harm efficiency when it does not foster appropriate behaviors, take advantage of time-saving technologies or show consistency in work processes. Also, employees may not work efficiently if they receive no recognition or reward for performing well.

Ways to Improve Workplace Productivity

There are several steps you can take to increase productivity at work and keep your employees motivated. You can use clear performance metrics to show employees the efficiency and quality of work you expect, and you can then show your workers appreciation when they meet those metrics. To be a more efficient manager, make sure your business has consistent work processes, allows for clear and honest communication and does not pressure employees with unrealistic deadlines. Employee productivity can also increase if you help them find new tools that speed up common tasks, take action when the work environment is hostile and give employees more control over their work.