Employee motivation: Time Utilization Principle
I run a web design company. Like most service companies, we are selling hours of our employees. The more hours are billed to the client, the better well off we are. The problem with graphic design and programming is that it is not always easy to assess the ratio of quality vs. speed and thus to say if a person is performing poorly, adequately or superbly this month.
At first, when the company was very young, there was a lot of motivation that drove everyone forward. However, with time everyone started to get more experience and demonstrate less enthusiasm for the job itself.
The question of motivation at work has been around for a couple of months. I thought of various employee motivation programs that would connect the quality with speed. However, these techniques turned to be a bit too complex to manage and to explain. One more problem is that we do not have a lot of money to pay out as bonuses.
As the result, the work of each person in our 11-man team was evaluated subjectively and did not always help the person chart their professional progress.
Last month an old University friend of mine who now works for a consulting company in the US came back to Belarus. In his company they introduced time utilization principle. It is all very simple. To find time utilization of your employees you have to divide the hours of their work that were billed to clients by the total hours they worked that month. For example, if your clients paid for 100 hours of the project work and the project took 200 hours, time utilization is 100/200=50%.
We calculated utilization for older projects and the figures were not so good for many employees. One of the reasons for that was not only poor work, but also poor time estimation, i.e. for how many hours the client was charged initially.
Time Utilization and Employee Motivation at Work
A week ago we had a discussion with everyone about time utilization and how the efficiency of work is going to be evaluated. It concerns not only the actual hours, but also the accuracy of estimates that go into invoices.
All employees are going to know their time utilization percentage. For each employee we are setting a realistic goal for improving the result. We can measure the progress in percentage points, which quite easy to understand and is very convenient and should help employee motivation as well.
No monetary incentives are planned for the first couple of months as we would like to receive initial feedback from everybody and take care of possible problem areas. For the future, I would like to have 80% time utilization for all employees. Money and other bonuses are going to be used to boost motivation at work to achieve this figure.
Certainly, time utilization principle is not a cure-all pill for improving intrinsic motivation of employees. What I like about it is simplicity and close ties of each person’s time utilization to the company’s bottom line.
