03 measuring effectiveness of workers (1)

7/28/2019 03 Measuring Effectiveness of Workers (1)

1/21

People in Business

Measuring the Effectiveness ofthe Workforce


2/21

Measuring the Effectiveness of the Workforce

In this topic you will learn about:

Methods of measuring workforce

performance

Labour turnover

Labour productivity

Absenteeism Calculatorsneeded!


3/21

Labour Turnover


4/21

Labour turnover

Labour turnover (staff turnover) can be

defined as the rate of change in a firms

labour force.

You need to know the following formula:

Number of staff leaving x 100

Total Number of staff


5/21

Labour turnover

Worked example:

A car firm has 1000 full time employees in 1 year

Of these, 50 employees leave the company

What is the labour turnover for the company?

Using the formula :50 x 100 = 5%

1000

Do you think this is high

or low?

What are the advantages

of labour turnover?

What are the disadvantages

of labour turnover?


6/21

Labour turnover

You will need access to the

internet to watch this video

clip

Same clip on PC
http://localhost/var/www/My%20Videos/Buss2/productivity.flvhttp://www.youtube.com/watch?v=YQsTzbd9P24


7/21

Labour Productivity


8/21

Labour Productivity

This can be measured in 2 ways.

1. Output per worker

2.

Labour costs per unit of output


9/21

Labour productivity - output per worker

You need to know the following formula:

Total value of Output

Total Number of workers

We would look at labour productivity over

a period of time e.g. 1 year


10/21

Labour productivity

Worked example:

A car firm produces 100 000 cars per year

It has a labour force of 1000 workers

What is the labour productivity (output per

worker)Using the formula then:

100 000 = 100 cars per worker

1000


11/21

Labour Productivity cost per unit

You will also need to be able to calculate

the financial aspect of labour productivity:

Labour Productivity cost per unit =

= Total Labour Cost

Number of units produced


12/21

Labour Absenteeism


13/21

Absenteeism

Absenteeism can be defined as the

number of staff who miss work as a

proportion of the total number of staff

You can use the following formula

Number of staff absent per time period x 100

Total number of staff days worked per time period


14/21

Absenteeism

Worked example:

A car firm has 1000 full time employees

Of these, 40 employees did not turn up for workon a Friday

What is the absenteeism rate for that Friday

Using the formula then:40 x 100 = 4%

1000


15/21

You need to know

these formulas!

Remember to show formulas

as well as calculating the

answers


16/21

Summary of formulas needed:

Labour Productivity

Labour productivity perworker

Total value of Output

Total Number of workers

Labour cost per unit

= Total Labour Cost

Number of units produced

Labour turnover

= number of leavers p.a. x 100

Average number of employees p.a.

Absenteeism

Number of staff absent per time period x 100

Total number of staff days worked per timeperiod


17/21

What can a Manager do.

To improve the labour productivity of the

workers?

To reduce the labour turnover statistics?

To reduce the number of absenteeism

days?


18/21

Your Task

Complete the

Qs on

Measuring staffproductivity

worksheet.


19/21

Worksheet task

1.Labour Turnover for a double glazing company. It introduced a new training programme and bonus scheme in Year 2.

Year 1 Year 2 Year 3 Year 4

Average number of

employees

42 41 42 43

Number of leavers 3 6 2 2

Value of output 1,500,000 1,300,000 1,600,000 1,800,000

Total labour costs 948,000 951,200 948,600 962,400

Average number of

staff absent on one

day

5 6 2 1


20/21

Questions.

Calculate the labour turnover for each year. ( 5 marks; 1 for formula and1 x 4 per calculation)

Calculate the labour productivity per year, using the output per employeeformula. . ( 5 marks; 1 for formula and 1 x 4 per calculation)

Calculate the labour productivity using labour costs per unit method. . ( 5marks; 1 for formula and 1 x 4 per calculation)

Calculate the percentage absenteeism rate for years 1 4. . ( 5 marks; 1for formula and 1 x 4 per calculation)

How has the new training programme and bonus scheme affected theperformance of labour in the company? (10 marks; C = 3 A = 4 E = 3)


21/21

Homework.

Textbook p 150 DO Analysis & Evaluation Q 2Vals Bakery

03 measuring effectiveness of workers (1)

Documents