Increasing the Productivity of Office Staff

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Increasing the Productivity o Oce Staf Indexing Key Perormance Measures using an Objectives Matrix Ofce productivity is a major concern o managements. One actor is a mistaken view that changes in ofce productivity cannot be measured and that there is thereore no way o ensuring that action to improve perormance achieves tangible results. However, the productivity o ofce work can be measured, and changes up and down can be detected allowing managerial action to be taken to ensure that improvement takes place. In the ollowing article I suggest how to go about it. Importance o improving ofce productivity Productivity is the relationship between the inputs required to produce a product or service, and the value o the output produced. In a actory this is relatively easy to calculate. A certain amount o material and labor is required at an easily measured cost to produce an article at a known exactory price. Te inputs and outputs in this case are simple and unambiguous. Tey can be measured and used as a management control, or as the basis o an incentive payment system. Productivity in the oce is not so clearcut. Inpu ts are airly selevident: sta equipment, oce costs, etc but what o the outputs? What exactly do departments produce seldom a single simple item? A management accounts department, or instance, will produce a variety o reports, some regular and some ‘ad hoc’ ‘ Tey will work on several tasks simultaneously, with constant interruptions, and it will be impossible to apportion the total input to each. Additionally , in this sort o activity, volume the number o reports produced is only one actor in their output. Will the department be twice as useul to the company i it produces twice as many reports? It may be more eective by producing hal as many, i it changed to exception reporting or instance, and the lesser number o reports was more useul and relevant. Productivity is also not increased i a report is completed by one person, instead o two, reducing the input, i it is either incorrect, or produced aer the date it is required. In measuring oce work, volume measures are seldom sucient on their own. Output measures must also take into account the quality o the output, its timeliness, and cost. Te eectiveness o the outputs is what matters, rather than the eciency with which they were produced. For this reason the choice o productivity measures must be related to the purpose and objectives o the department and organization, and the needs o customers. How to value outputs All unctions in an oce have customers or their services, not just those that deal with other organizations or members o the public. Te sta o the organization are the customers o the salaries department, which itsel is a customer or the data supplied by personnel. Te analysis o who uses the services provided by each unction, and the initiation o a dialogue about the value kind delivery perormance o each o the services provided is the key to the development o useul perormance measures. I the customer does not want and value the output you are producing, it has no value and you may as well not do it. Equally what you consider to be the priority or the various services you provide may not be the customer’s priority . When was the l ast time you asked him or her? Matching your service more closely to customer requirements can in itsel promote signicant productivity gains by eliminating unnecessary work. I once undertook a business analysis study on a company’s production planning and control system. Te Inormation Services Department was working fat out producing reports on the various systems that were being run, production planning, production control, admin, stock control, human resources, engineering maintenance planning etc. Objectives matrix: A method o index- ing key perormance measures and calculating an overall, multi–actor perormance index.

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Increasing the Productivity o O ce Staf Indexing Key Per ormance Measures using an Objectives Matrix

Ofce productivity is a major concern o managements. One actor is a mistakenview that changes in ofce productivity cannot be measured and that thereis there ore no way o ensuring that action to improve per ormance achievestangible results. However, the productivity o ofce work can be measured, andchanges up and down can be detected allowing managerial action to be takento ensure that improvement takes place. In the ollowing article I suggest howto go about it.

Importance o improving ofceproductivityProductivity is the relationship betweenthe inputs required to produce a productor service, and the value o the outputproduced. In a actory this is relatively easy to calculate. A certain amount o material and labor is required at an easily measured cost to produce an article at aknown ex‑ actory price. Te inputs andoutputs in this case are simple and unam‑biguous. Tey can be measured and usedas a management control, or as the basiso an incentive payment system.

Productivity in the o ce is not soclear‑cut. Inputs are airly sel ‑evident:sta equipment, o ce costs, etc but what

o the outputs? What exactly do depart‑ments produce ‑ seldom a single simpleitem? A management accounts depart‑ment, or instance, will produce a variety o reports, some regular and some ‘adhoc’ ‘ Tey will work on several taskssimultaneously, with constant interrup‑tions, and it will be impossible to appor‑tion the total input to each.

Additionally, in this sort o activ‑ity, volume ‑ the number o reports pro‑duced ‑ is only one actor in their output.

Will the department be twice as use ul tothe company i it produces twice as many reports? It may be more e ective by producing hal as many, i it changed toexception reporting or instance, and thelesser number o reports was more use uland relevant.

Productivity is also not increasedi a report is completed by one person,instead o two, reducing the input, i itis either incorrect, or produced a er thedate it is required.

In measuring o ce work, volumemeasures are seldom su cient on theirown. Output measures must also takeinto account the quality o the output,its timeliness, and cost. Te e ectiveness

o the outputs is what matters, ratherthan the e ciency with which they wereproduced. For this reason the choice o productivity measures must be related tothe purpose and objectives o the depart‑ment and organization, and the needs o customers.

How to value outputsAll unctions in an o ce have customers

or their services, not just those that dealwith other organizations or members o the public. Te sta o the organizationare the customers o the salaries depart‑ment, which itsel is a customer or thedata supplied by personnel.

Te analysis o who uses the

services provided by each unction,and the initiation o a dialogue aboutthe value kind delivery per ormance o each o the services provided is the key to the development o use ul per or‑mance measures.

I the customer does not wantand value the output you are producing,it has no value and you may as well notdo it.

Equally what you consider to bethe priority or the various services youprovide may not be the customer’s prior‑ity. When was the last time you askedhim or her?

Matching your service moreclosely to customer requirements can initsel promote signi cant productivity gains by eliminating unnecessary work.

I once undertook a businessanalysis study on a company’s produc‑tion planning and control system. TeIn ormation Services Department wasworking fat out producing reports onthe various systems that were beingrun, production planning, productioncontrol, admin, stock control, humanresources, engineering maintenanceplanning etc.

Objectives matrix: A method o index-ing key per ormance measures andcalculating an overall, multi– actorper ormance index.

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In total there were over 100 regularreports produced, with distributionlists o running well into 3 gures at alllevels o the organization, over a widegeographic area. Producing these reportswas a signi cant element o IS’s workload,and due to increasing demands or otherservices, the IS department elt that it was

orced, reluctantly, to try and reduce the

number o reports produced or expand it’scost base by employing more.Part o my role as project team

leader in this exercise was to interviewthe managers who received the in orma‑tion and try to persuade them to reducetheir requirements.

In the event the reaction Ireceived was the opposite o that whichI had been led to expect. Most manag‑ers I spoke to were only too happy todiscontinue receiving the reports. Many

Te department was more e ective,as well as more e cient.

The development o per or-mance measuresNo single measure is likely to beable to encompass the range o work undertaken by most o ces.

A range o measures must be usedwhich refects the main inputs andoutputs o the department. A ‘ amily’o measures can refect the work o the department in a way no singlemeasure can. For example, the key per ormance measures chosen ora management production controldepartment might be:• Reports with errors / Total

Reports• Actual cost / Forecast Cost• Average Report Produc-

tion Time• Reports late / Total Re-

ports• Number of reports /

Number of staff • Average Cost of Reports

Tese measures shouldencompass the range o inputs used:labor, materials, capital and equip‑ment, and the measures shouldencompass the actors o quantity,quality, timeliness and cost.

A amily o measures such asthese, related to the real objectiveso the department, allows the levelo per ormance to be measured andmonitored over time to establishwhether it is stagnating, declining orimproving. It allows the e ect o pro‑ductivity initiatives to be establishedand ocuses managers’ attention onthe need to improve productivity, theonly true way to improve a compa‑ny’s competitive position.

Figure 1.

Performance Measure

1 2

Index Actual Actual

Minimum 1 5.5 3

2 6.0 6.5

3 6.5 2.4

4 7.0 2.1

5 7.5 1.7

6 8.0 1.5

7 8.5 1.2

8 9.0 0.9

9 9.5 0.3

Maximum 10 10.0 0.0

Weighting 60% 40%

NB Performance measure 1 = reports per manPerformance measure 2 = % reports with errors

Figure 2

Measure (Weight) Measure (Weight) Weighted Value MeasureReports / Man (60%) % Report Errors (40%)

Actual Index Actual Index (Reports) (% Errors) TotalWeek 1 7.0 4.0 0.9% 8.0 .4 3. 5.6Week 7.5 5.0 1. % 7.0 3.0 .8 5.8Week 3 8.0 6.0 .4% 3.0 3.6 1. 4.8Week 4 8.5 7.0 3.0% 1.0 4. 0.4 4.6Week 5 7.0 4.0 .4% 3.0 .4 1. 3.6

Week 6 8.0 9.0 .7% .0 5.4 0.8 6.Week 7 8.5 7.0 .7% .0 4. 0.8 5.0Week 8 7.5 5.0 1.5% 6.0 3.0 .4 5.4

predated their time in the job, and they merely looked at them, be ore ling ‘ orre erence, just in case’.

Many o the managers whoneeded the reports said that the ormatwas not as they wanted, the in ormationwas not exactly what they needed, orthey had to make additional calculations,or change the presentation to make it

easier to see relationships or trends.As a result o the review, thenumber o reports was cut by more thanhal , and the ones which continued to beproduced were changed to make themmore use ul to the managers involved.

In this case, the per ormance o the In ormation Services Departmentwas improved, because what they wereproducing met the needs o their cus‑tomers more closely, while at the sametime workload and cost were reduced.

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Indexing per ormance measuresIn order to be able to compare dissimilarmeasures, such as cost and quality, to seethe inter‑relationships between them, itis possible to index the measures scores,and so convert them to the same scale. I a weighting is applied, an overall produc‑tivity index can be created.

Te index scale is created by es‑tablishing a target per ormance or each

measure. Tis is use ul in itsel , as peopleand work groups should have targets orquality o service so that they know thestandards o work that they are expectedto achieve. Te bottom o the targetrange is de ned as the minimum levelo service that can be permitted. Inter‑mediate values are calculated or scoresbetween these ranges. For example seeFigure 1.

Dissimilar measures can then becompared, and combined to producean overall per ormance measure. Tis isshown in Figure 2.

In this example, the volume o output is rising, but the error rate isincreasing as a consequence. Te relativeimportance o the measures as de nedby the weightings attached and by thisstandard the overall per ormance o thework group has declined.

Tis method o indexing per orm‑ance measures, and calculating anoverall, multi‑ actor, per ormance indexwas developed in the US by the Univer‑sity o Oregon, and is called an objectivesmatrix.

PC per ormance reportingTis all seems very complicated, butthere is a simple computer program

or PCs which guides departmentalmanagers through a process o con‑sidering the purpose and objectiveso their department and company, as‑sists in the identi cation o customersand their needs, helps in the develop‑ment o measures, and the collection,

calculation and presentation o thedata.

An example o the type o report that can be produced by theprogram is illustrated in gure 3. Inthis example the number o reportsper number o sta has increased, butwith a corresponding increase in thenumber o errors.

It’s relatively easy to setupa spreadsheet to do the numbercrunching and generate the graphs

or your particular department us‑ing the in ormation outlined in thispaper.

Using per ormance measuresO course, measuring productivity in this way is not an end in itsel . Aonce o calculation is o very limiteduse. However as data is collectedover time, trends can be determinedto show where productivity improve‑ments are occurring, and whereaction is needed to correct stagnantor declining per ormance. Te e ‑

ects o action can be progressively

0

1

2

3

4

5

6

7

8

Total

(% Errors)

(Reports)

Week 8Week 7Week 6Week 5Week 4Week 3Week 2Week 1

Production Reporting Performance Measures

P e r f o r m a n c e

I n d e x

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Contact: Clif F. Grimes

E-mail: c [email protected]

monitored, and progress comparedbetween departments. Te develop‑ment o per ormance measureswill ocus attention on the need tocontinually improve productivity inorder to maintain and improve thecompetitiveness o the organization.

Tis approach to per ormancemeasurement has been extensively

used in the United States, or o ceworkers at all levels, rom clerks toscientists, and also or workers inservice industries. A consortium o major companies and governmentorganizations, including 3M, West‑inghouse, Northern elecom, Chrys‑ler Corporation, Nabisco Brands, theUS Army, Navy and the departmentso Commerce, Education and Justice,developed the so ware, which isused to assist in this process.

ConclusionTis method o monitoring the per‑

ormance o o ce and service sta works. It will enable you to identi y your current levels o per ormance,and where action is needed to im‑prove them. It will provide eedbacko the e ects o your actions, andensure that the per ormance o yoursta continually improves.

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A

B

C

D

How production and service time is made up…how to view work

TOTAL

WORK

CONTENT

TOTAL

TIME OF

OPERATION

UNDER

EXISTINGCONDITIONS

TOTAL

INEFFECTIVE

TIME

BASICWORK CONTENT

of product or service

WORK CONTENT

ADDEDby defects in design orspecication

WORK CONTENT

ADDEDby inefficient methodsof manufacture or

operation

INEFFECTIVE TIMEdue to shortcomingsof management

INEFFECTIVE TIMEdue to shortcomingsof workers

2005 © Copyright Accel Team

Trans orm your workplaceTe resources in the Accel Productivity Improvement Collection will enableyou to trans orm existing conditions (see schematic) to improve business andemployee productivity.

• Measure per ormance, utilization and e ciency • Set accurate per ormance standards• Make improvements to processes, products and services• Involve employees in improving productivity • Achieve goal congruence• Improve working conditions• Cultivate a productivity improvement culture

• Improve your management and leadership skills• Get on top o your job

What’s the realproblem?

Evaluate the schematic opposite.Your real problem will lie with workcontent added (A, B,) and or ine ‑

ective time (C, D.) Whether your

organization produces a product orprovides a service, the Productivity Improvement Collection will assistyou in de ning the real problem,then solving it.

It’s not rocket scienceTese resources do not expect youto be an industrial engineer. All thatis required, to make improvements,is a modicum o common sense,tact, grit and patience in a spirit o cooperation and consultation.

Productivity Improvement CollectionAn indispensable set of supervisory guides for the simple analysis, measurement andimprovement of departmental and organizational productivity

PURCHASE$39.99(requires Internet)

Productivity ImprovementCollection

Sense • Simplicity • Relevance = Results

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Accel

Productivity ImprovementCollection

Employee Motivation, theOrganizational Environment

and Productivity

Employee Performance

Improvement

Organizational Norms Survey

Productivity Improvement

Personal Efficiency

Employee Evaluation and Selection

Team Building

Open Systems Analysis

TotalWork

Content

Time of Operationwithin the

Controlof the

Management

Total Timeof

Operationunder

ExistingConditions

TotalWork

Contentof the

Product

BASIC WORK CONTENT

A1.BAD DESIGN OF PRODUCT / SERVICE prevents use of most economical processes

A2.LACK OF STANDARDIZATION prevents use of high-volumn processes

A3.INCORRECT QUALITY STANDARDS cause unnecessary work

B1.WRONG MACHINES used

B2.PROCESS NOT OPERATED CORRECTLY or in bad condition

B3.WRONG TOOLS used

B4.BAD LAYOUT causing wasted movement

B5.OPERATIVE ’ S BAD WORKING METHODS

C1.EXCESS PRODUCT VARIETY adds idle time due to short runs

C2.LACK OF STANDARDIZATION adds idle time due to short runs

C3.DESIGN CHANGES add ineffective time due tostoppages and rework

C4.BAD PLANNING of work and orders adds idle timeof manpower and machines

C5.LACK OF RAW MATERIALS due to bad planning adds idle timeof manpower and machines

C6.PLANT BREAKDOWNS adds idle time of manpowerand machines

C7.PLANT IN BAD CONDITION adds ineffective time due to scrapand rework

C8.BAD WORKING CONDITIONS add ineffective time through forcing

workers to restC9. ACCIDENTS add ineffective time throughstoppages and enforced absence

D1. ABSENCE , LATENESS AND IDLENESS add ineffective time

D2.CARELESS WORKMANSHIP adds ineffective time due toscrap and rework

D3. ACCIDENTS add ineffective time throughstoppages and enforced absence

WORK CONTENT

ADDEDby defects in design

or specicationof product / service

WORK CONTENT

ADDEDby inefficient methods

of manufacture or

operation

INEFFECTIVE TIMEdue to

shortcomings of management

INEFFECTIVE TIMEwithin thecontrol of the worker

Use above supervisory guidescontained in the Productivity

Improvement Collectionto reduce A, B, C, and D work

content, in order to reduce theoverall time it takes toproduce your goods or

services.

The 8 Supervisory Guides