How To Calculate Productivity in Under 5 Minutes
More than 50% of employees are “relatively unproductive” at work, according to McKinsey.
So, sooner rather than later, you need to get an objective response to this question: “How to calculate productivity within my team?”. And act on it fast, as otherwise, a lack of productivity costs you and your business by the day.
What is productivity? (and why it actually matters)
At its simplest, productivity measures how efficiently you turn resources, like time, money, or effort, into valuable results.
So, it’s your output divided by your input, measured over time. But unlike the vague “busy work” that’s in essence toxic productivity, which just fills your days, true productivity focuses on meaningful results. Meaningful results are the finalised projects within the agreed timeline, the campaign plans created for your client, or the tasks completed that move a strategy forward.
Why does productivity matter?
Employee productivity is directly connected to your company’s bottom line.
Companies with engaged teams outperform companies with disengaged teams by 202%. At the same time, disengaged employees cause $8.8 trillion in lost productivity every year globally, according to Gallup. To add a layer of clarity, engagement and disengagement refer to labor productivity, as if employees are not engaged in their jobs, they’re unproductive.
What are other obvious reasons for which you should be measuring productivity and increasing it?
- It drives profitability and growth: Higher productivity is always connected with increased profitability and growth. McKinsey reports state that this is the case at the firm and national levels, and standout companies (in terms of productivity) have bigger financial performance and investment capacity.
- It enhances decision-making: While not always directly quantified, productivity metrics are highlighted in any operational excellence framework based on McKinsey. When you track productivity and enhance it, you can make informed resource allocation strategies and planning.
- It improves operational efficiency: When you track and improve productivity levels, you’re able to discover bottlenecks with more agility and deliver faster at lower costs.
- It boosts accountability and motivation: Transparent metrics create a culture of ownership, improvement and employee satisfaction. All these are central and recurring themes in organizational performance.
- It strengthens your competitiveness: A more productive company will always be able to offer better pricing and quality. This results in a better position on the market.
Productivity impacts many other areas of your business, and it ultimately allows your business to be more innovative, have sustainable growth, and have a healthy work environment.
The basic productivity formula that works
As I’m convinced you’re not trying to overcomplicate your work, I’ll teach you how to calculate productivity based on a simple model. Here’s the foundation everything else builds on:
Productivity = Output ÷ Input
Let’s break this down with a real example. Let’s say your customer service team handled 480 support tickets last week, working a combined 120 hours. In this case, your productivity rate would be:
480 tickets ÷ 120 hours = 4 tickets per hour
But here’s where it gets interesting. The next week, they handled 450 tickets in 100 hours:
450 tickets ÷ 100 hours = 4.5 tickets per hour
The same team, fewer total tickets, but higher productivity—this is the insight that separates effective operations from busy ones. You can also keep in mind here that the tickets’ complexity may be entirely different.
You can apply this standard productivity formula to virtually any work scenario:
- Sales: Revenue generated ÷ Hours worked
- Content creation: Articles published ÷ Time invested
- Manufacturing: Units produced ÷ Labor hours
- Software development: Features delivered ÷ Development time
The key is choosing meaningful outputs that align with your business goals, not just the easiest things to count.
4 other ways to measure productivity
1. Task completion rate
Track how many planned tasks your team completes versus how many they started with. This gives you a clear picture of planning accuracy and execution effectiveness. If you consistently get high completion rates (above 75%), then you have a good planning and execution.
How to calculate: Task completion rate = (completed tasks ÷planned tasks) × 100
Team example: Your customer service team planned to handle 50 support tickets this week, but they completed 42. Hence, the task completion rate = (42 ÷ 50) × 100 = 84%
What to track weekly:
- Monday planning session: List all tasks each team member commits to, or just keep these logged in a project management software. You don’t have to write these yourself, but make your team members accountable for keeping track of their productive tasks.
- Friday review: Check and Ccunt actual completions – Be aware that you have to count in delays caused by different stakeholders, etc, and don’t directly assume your team is unproductive.
- Calculate individual and team rates
Management benchmarks:
- 75% + = Strong planning and execution
- 60-74% = Review task complexity or resource allocation
- Below 60% = Investigate bottlenecks or unrealistic planning
📍 Action steps: If your team’s rates consistently fall below 75%, dig deeper. Are tasks too complex? Do team members need more time or training? Are there unexpected interruptions? Use this data to improve your weekly planning process.
2. Revenue per hour analysis
For revenue-generating teams like consulting, marketing, or sales team members, divide the money they bring in by the time invested.
How to calculate: Revenue per hour = total revenue generated ÷ total hours worked
Team example: Your sales team of 4 people worked 160 hours last month (4 people × 40 hours/week × 1 week) and closed $64,000 in new business.
Revenue per hour = $64,000 ÷ 160 hours = $400/hour
What to track monthly:
- New client revenue
- Existing client expansions
- Time spent on sales activities (calls, meetings, proposals)
- Administrative time (separate from revenue-generating time, as your team deals with repetitive tasks as well).
Worried about tracking time accurately?
Instead of manually logging hours, as manual timesheets are time-consuming, I recommend using an automatic time tracker.
EARLY, for example, automatically captures time spent across different activities. It can distinguish between 3 hours spent in a CRM software (revenue-generating) versus 2 hours in email (administrative). So it can easily give you precise data for your calculations on employee activity data.
With EARLY, you can:
- See real-time data on hours spent by individual team members or across entire projects.
- Identify bottlenecks by pinpointing tasks that consistently take longer than planned.
- Compare planned vs. actual time to improve future estimates and resource allocation.
📍 Action steps: If revenue per hour is declining, analyze whether it’s due to market conditions, lead quality, or process inefficiencies. Use this metric to identify your top performers and understand what they’re doing differently.
EARLY captures everything—from deep focus sessions to those quick Slack checks—giving you the full productivity picture.
3. Quality metrics monitoring
Count revision requests, error rates, and client satisfaction scores. High productivity with poor quality destroys long-term value and creates more work later.
How to calculate: Quality score = (error-free work ÷ total work output) × 100
Team example: Your design team completed 25 projects this month. 3 required major revisions, 2 had minor errors, and 20 were approved without changes. Quality score = (20 ÷ 25) × 100 = 80%
What to track weekly:
- Work requiring no revisions
- Minor corrections needed
- Major revisions or rework
- Client satisfaction ratings
- Time spent on corrections
Management benchmarks:
- 90 %+ = Excellent quality standards
- 80-89% = Good but monitor trends
- Below 80% = Quality issues affecting productivity
📍Action steps: If quality scores drop, investigate whether it’s due to rushed deadlines, skill gaps, unclear requirements, or insufficient review processes. Remember: fixing quality issues early prevents bigger productivity drains later.
4. Goal achievement tracking
Ask your team to set their own 3-5 specific work goals per month or quarter and track completion percentages. Help them with any bottlenecks in your 1- 1s, or any other way – it’s best to be proactive. This measures both how your team sets long-term and short-term goals
setting accuracy and execution capability.
How to calculate: Goal achievement rate = (goals completed ÷ goals set) × 100
Team example: Your project management team set 12 goals this week across 3 team members (4 goals each). They completed 9 goals fully and made partial progress on two others. Goal Achievement Rate = (9 ÷ 12) × 100 = 75%
What to track weekly:
- Specific, measurable goals set at the beginning of the month or quarter
- Completion status by Friday afternoon
- Reasons for incomplete goals
- Goal difficulty and resource requirements
Management benchmarks:
- 70-80% = Optimal challenge level
- 80 %+ = Goals may be too easy
- Below 70% = Goals are too ambitious or obstacles are present
Action steps: If achievement rates are consistently above 85%, increase goal difficulty to drive growth. If below 65%, review whether goals are realistic, resources are adequate, or unforeseen obstacles are blocking progress.
Red flags: When productivity math is lying
The hours trap
During an 8-hour workday, the average employee only spends 4 hours and 12 minutes actively working, according to Zippia.
If you’re measuring your team’s productivity purely by hours logged, you’re missing half the story. This creates a false sense of productivity, and you might end up rewarding attendance over results.
Instead, focus on output quality and completion rates when evaluating team performance. Hours worked should be a baseline expectation, not a productivity metric
The multitasking myth
According to this report, someone touches their phone 2,617 times per day, switches tasks every 3 minutes, and processes the equivalent of 174 newspapers’ worth of information daily. If your productivity calculations don’t account for context switching, your numbers are inflated. True productivity requires sustained focus and deep work.
Unnötige Meetings
71% of the weekly meetings employees have to attend are unproductive, according to Harvard Business Review. Don’t count meeting time as productive unless it directly leads to decisions or action items. Many high-performers actually have lower meeting attendance but higher output.
The activity vs. achievement error
Your team might be answering 200 emails a day, but if none of the advanced key projects are being worked on, it’s just expensive busy work. Research shows 60% of employee time is spent on “work about work”—activities they do throughout the day that aren’t what you hired them to do (Asana).
As a leader, always distinguish between team activity (being busy) and achievement (moving business goals forward). Measure outcomes, not outputs.
From numbers to action: using your productivity data
Productivity measurements are the first piece of the puzzle, but they’re followed by actionable strategies to raise the productivity ratio. Let’s understand some key metrics that can help you with creating even higher employee performance:
A weekly team review process
Every Friday, carry out a 15-minute check on your productive employees and how much revenue your projects generated against your predictions. Focus on these key questions:
- Which projects took longer than estimated, and what caused the delays?
- When was your team most/least productive during the week?
- What patterns do you notice in your team’s high-output periods?
- Are there recurring obstacles slowing down multiple team members?
- Can you create a more positive work environment to help them achieve more productivity?
Use this data to adjust next week’s planning and resource allocation.
📍Pro tip: EARLY’s automated weekly reports provide these insights without manual data collection. You’ll see exactly which team members were most productive on which days or how much work was put into a project already. This way, you’re making your Friday reviews data-driven rather than based on memory or guesswork.
The 80/20 team analysis
High-performing employees are 400% more productive than average employees due to talent, engagement, and wisdom (McKinsey). As a manager, identify which 20% of your team’s activities drive 80% of your business results. Then systematically:
- Assign more high-impact work to your top performers
- Delegate low-value tasks or eliminate time wasters that drain team resources
- Reallocate team time toward strategic activities, add productive meetings, and remove the ones that are not
- Consider automating or outsourcing routine work that doesn’t require your team’s expertise
Identify team bottlenecks
Analyze your productivity data to spot recurring patterns where employee productivity drops. Common organizational culprits include:
- Approval processes that create unnecessary delays and affect how much output they generate
- Team members switching between too many different projects, affecting the total productive hours
- Unclear project requirements, success criteria, or organizational targets
- Inadequate tools, software, or resources on which you’re measuring productivity and tracking progress
- Dependencies between team members that create waiting periods
Address these systematically by streamlining processes, clarifying expectations, and investing in better tools or training.
Team calibration
Share productivity insights (not surveillance data) with your team. When everyone understands what “good” looks like, performance naturally improves. Organizations with higher employee engagement have double the average productivity rate. That leads to more services produced and an overall higher employee engagement.
Die Quintessenz
Measuring and increasing productivity in the workplace takes time. Start measuring one metric consistently for 30 days. You’ll be surprised how much clarity emerges when you replace gut feelings with actual data. The goal isn’t to optimize every minute but to ensure your effort aligns with your impact and generates a higher total output.
Remember: the most productive people aren’t necessarily the busiest ones. They’re the ones who know exactly where their time goes and consciously direct it toward what matters most.