Productivity vs. Performance

productivity

Executives and managers alike tend to confuse productivity with performance. Some consider both terms as interchangeable or synonymous when they are not. But before I explain the relevance of these dissimilar terms in a workplace, allow me to define each.

Productivity, according to a business dictionary, is a measure of the efficiency of a person, machine, factory, or system that converts inputs into useful outputs. Performance is defined as the accomplishment of a given task measured against preset known standards of accuracy, completeness, cost and speed. In other words, productivity is the quantity of work while performance is the quality.

Understanding the difference between the two as it relates to employees in a company will allow for a better, more efficient work environment. At least, executives and managers would understand what expectations they are communicating to their employees.

When companies use these terms interchangeably, the employee is often accused of lack of productivity and/or poor performance. Especially if the company is more focused on making many products in record time, an employee who prides himself in quality work might go unappreciated. In fact, he might receive backlash for holding up the proverbial conveyor line in the production because he is too focused on making sure the product is of good quality.

In certain industries, both performance and productivity are vital for the company’s success. For example in consulting firms, the products are the employee’s service and deliverables requested by a customer. The executives are especially critical about both because of how it affects the customer and eventually affects their bottom line. Whether or not they offer a fostering environment for their employees, most if not all executives care about making profit. This also means cutting costs in an attempt to increase their ROI, and most associate ‘cost-savings’ with impending layoffs. And guess who’s the first considered when another round of layoffs begin? The “unproductive” employee.

Sadly enough, this unproductive employee might have implemented an efficient system for current and future projects to be updated and evaluated or perhaps he/she spent weeks organizing databases that would be useful for the entire company… but alas, they contributed zero dollars to the company. Sure they may have saved the company time with their efficiency, but as far as the manager is concerned, this employee brought in zero sales and no new customers. Now if the company is more interested in increased ROI and high revenue streams, that employee would unquestionably be out of a job.

And for the millennial who is assigned to menial tasks including the reorganization of project folders, bringing coffee for senior employees (pardon my facetiousness) or other “busy work” that prevents them from directly affecting the project results, they could be among the first considered for a re-assignment or a layoff. Or if they’re lucky enough to escape the wave of layoffs, their evaluation reads “you’re doing the bare minimum so we need you to do better in the next quarter…”

The problem is “better” is qualitative even though the executive’s expectation is quantified in terms of sales numbers…

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