“While productivity isn't the sole determinant of success, it remains one of the most crucial factors over the long term,” says ExpenseOnDemand director Siddharth Nigam.

In business, productivity is crucial even in the best of times. However, during challenging trading conditions, maximising the efficiency of limited resources can determine whether a company survives or shuts down. This underscores the close relationship between productivity and resilience, as highly productive companies are better equipped to withstand unexpected shocks.

What is productivity and why is it important?

In simple terms, productivity is about how effectively resources like staff time, inventory, and capital are transformed into revenue-generating products and services.

Lost productivity costs employers $1.8 trillion each year.²

One of the most common measures is revenue per hour worked. When companies increase revenue without increasing working hours, they're considered productive.

For small businesses, productivity enables them to compete with larger counterparts and meet customer needs on a tight budget. It also creates flexibility to handle unexpected expenses or sales variations.

How to measure and manage productivity

Measuring productivity requires calculating ratios like revenue per full-time employee or profit divided by expenses over a consistent time period. While large corporations meticulously measure such metrics, smaller businesses often don’t have the tools or manpower. Consequently, they miss out on insights that could help streamline operations.

Fortunately, ExpenseOnDemand offers easy-to-use expense management software that provides the visibility independent contractors and small businesses need to measure productivity. By automatically capturing expense data and linking it to projects and clients, the solution makes it simple to see key ratios across your business.

You can effortlessly monitor individual employee spending or the company's overall expenditure on business expenses. Alternatively, you can calculate expenses as a percentage of revenue to gauge profitability. This level of visibility enables you to pinpoint successes and areas for enhancement effectively.

Redesign your workflow

Step through your list of inefficiencies and work out the kinks. You can often make big improvements simply by clarifying roles and responsibilities, optimising job sequencing and enhancing communication between departments.

Make sure employees know where to access the details they need to complete tasks or assist customers.

Reducing the time wasted searching for information, waiting for approvals, or tracking people down to ask questions is a productivity game-changer.

ExpenseOnDemand provides authorised employees with immediate access to the financial information they need, precisely when they need it. This streamlining of workflows effectively reduces bottlenecks, resulting in a smoother, more efficient operation.

3 tips to boost small business productivity

While every small business faces unique challenges, these three universal tips can help you optimise productivity:

1. Adopt technology

Small businesses that leverage technology tools effectively can bridge the productivity gap with larger enterprises. ExpenseOnDemand is tailor-made to assist small businesses in managing expenses and gaining valuable insights.

86% of UK workers agree that workflow automation software would boost productivity while making workers happier and improving morale.

2. Systematise processes

Standardising repetitive tasks saves employees time while reducing mistakes. Document procedures so staff can consistently follow best practices. ExpenseOnDemand simplifies even the most complex expense-related tasks with straightforward workflows and processes.

3. Incentivise employees

Workers who feel invested in the company’s success are intrinsically motivated to be productive. Offer bonuses or perks for meeting targets to ignite their competitive spirit. ExpenseOnDemand's user-friendly interface simplifies expense management, empowering your employees to focus on their best work with greater efficiency!

Reality check: worldwide study on small business productivity

Much remains unknown about small business productivity. To develop smarter strategies, ExpenseOnDemand invites you to a free consultation to discover how automating your expense reporting can save your business money and time to reinvest in higher revenue generating tasks.

The insights will empower small businesses to match and even surpass their larger counterparts.

Now is the opportune moment for small businesses to prioritise productivity. By measuring, managing, and maximising it with solutions like ExpenseOnDemand, they can enhance performance and resilience regardless of economic conditions. Thriving amidst uncertainty yields the ultimate productivity dividends.

Start improving your productivity today

Experience enhanced productivity with ExpenseOnDemand's streamlined interface. Watch our 50-second video below and schedule your demo today:

https://www.expenseondemand.com/book-a-demo

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Sources

1. https://www.welcometothejungle.com/en/articles/8-hour-work-day

2. https://slack.com/intl/en-gb/blog/collaboration/effects-low-productivity-business-growth