We use productivity metrics to analyze how employees’ work affects business objectives. These KPIs are vital for improving the overall job site productivity while reducing unnecessary waste.
Although performance analysis is vital in any business, it is even more essential for construction companies. A lot of unpredictable things can happen in the field, with revenue and expense variables being rather high.
Among other things, productivity metrics play a key role in improving employee well-being. They asses how a company can better allocate its resources while reducing the burden on craftsmen. In this article, we’ll talk about the benefits of construction KPIs and will go through some of the most important ones.
We can calculate the overall productivity on a job site by summing up outputs and dividing them by total inputs. Keep in mind that productivity is quite a vague KPI. While it shows you whether or not your business is doing things right, it doesn’t take into account various business factors.
This is why the input/output model usually doesn’t work. Instead, we utilize a three-part process. We take into account the company’s main objectives, and we select appropriate metrics that would reflect these objectives. As a third part, we take into account employee-related KPIs.
Most construction businesses introduce their own standards for performance. According to these standards, they can create a workflow with deadlines, timestamps, and progress. But when companies assess productivity for sustainability, they’re able to enhance the approach to encompass entire organizations.
Through accurate result measuring, construction companies are able to significantly boost their revenues and improve their market positioning. These are just a few ways KPIs help construction businesses yield better results:
These metrics are vital for detecting and addressing potential issues as well as anomalies within the company’s activities. By reacting to what construction KPIs tell us, we’re able to minimize business losses.
No matter whether you’re a small family-owned business or a large international corporation, you’ll have a unique set of needs. These needs will affect the selection of metrics. Your goal is to create an analytical model that will focus on aspects of productivity that are most relevant to your particular case.
Although it’s always better to use as many metrics as possible, as they would give you a more comprehensive understanding of the performance, you’ll likely have to settle on a few crucial ones:
Perhaps the most important performance metric is the revenue per employee. The KPI is crucial in construction, as it is often hard to track what each person is doing on the job site.
Revenue per employee is measured by taking the total revenue over a period and dividing it by the total number of workers. Among other things, this KPI shows us if we’re understaffed or if the current employees are undermotivated. In many cases, it indicates a lack of jobsite control.
While this metric is fantastic, it doesn’t take into account individual performance.
The total cost of workforce, otherwise referred to as TCOW, shows us how much money we’ve spent on our workforce. Besides salaries, it also takes into account bonuses, training, taxes, worker benefits, and more. With this indicator, we can see how much money we’ve spent on our workforce compared to our overall operating costs.
TCOW helps construction companies enhance their budgeting and decision-making processes. If we’re able to minimize the value of this metric while having a high revenue per employee, we should consider increasing our workforce. Total cost of workforce shows how spending money on our workers translates to business profits.
Another worker-related metric is the employee utilization rate. It shows how many hours our employees spend on productive activities in comparison to spending time on something that doesn’t generate profits. The metric is especially valuable when executing projects for clients, making it a necessity in IT, marketing, construction, and consulting.
We get this figure by dividing the billable hours by total hours worked. For example, if a person works 50 hours per week, and out of those 50, only 30 are billable, the utilization rate will be 60%. With this metric, companies determine if they’re using the available employee hours the right way.
This employee engagement metric is somewhat similar to the employee utilization rate. In fact, many companies use these two KPIs in conjunction. Basically, focus hours per day show us how many “focused” hours a person has each day.
Nowadays, companies use various types of time tracking for construction to determine each person’s input. These tools monitor what we’re doing at every moment, and whether we’re located on a job site. Through focus hours per day, we’re also able to learn more about bottlenecks and other external barriers hindering employees’ performance.
The construction business is notorious for wasting resources. Although modern companies spend enormous money on planning their budget and other aspects of a project, delays in the field derail these plans. Planned-to-done ratio is a vital indicator in project management, as it analyzes our ability to stick with the initial projections.
We get this KPI by summing up the total tasks that need to be done and dividing them by the number of tasks that were actually finished. For example, if you plan on finishing 100 tasks and do 90 of them, you’ll have a 90% planned-to-done ratio.
If you’re serious about your business, you should introduce productivity metrics into your flow. These financial and operational indicators show you how your workforce is doing in the field, but also whether your plans are effective.
Luxury used to be all about flashing big logos and bold statements. But lately, the game’s changed. Quiet luxury is all about subtlety: investing in quality, craftsmanship, and classic pieces that don’t cry out for attention but quietly elevate your space. It’s that feeling you get walking into a room where everything just feels right, without needing […]
Imagine a home that breathes with the breeze, where sunlight filters through lush foliage, and the vibrant hues of nature are an extension of your living space. Tropical houses are architectural marvels; a profound dialogue between human habitation and the natural world, born from centuries of adapting to warm, humid climates. Far from rigid structures, […]
Buying a mini excavator isn’t something you do on a whim. Whether you’re expanding your fleet or picking up your first machine, you need to know it’s the right fit, not just for today’s jobs, but for what you’ll be tackling a year or two down the line. These machines might be smaller than full-size […]
“Dream kitchens don’t just happen — they’re designed with care and style.” Walking into the same old and outdated kitchen in your home? It’s time to change the design and get that wow factor, according to your needs and wise design choices. Seems like a challenging task, right? But let’s be clear here, the kitchen […]
Kerala style homes have courtyards surrounded by rooms on each side. Traditional Kerala-style homes have a central courtyard known as Nadumuttam surrounded by rooms. These homes promote natural light and ventilation according to the region’s climate. These homes, due to the feature of courtyards as their core spaces, offer beautiful opportunities for social gatherings. This […]
When it comes to enhancing the kitchen window over the sink, various design ideas are possible to decorate Indian homes. From rooted in tradition to Western-style modular kitchens offer both functionality and attractive aesthetics. Apart from the sleek profile and raised breakfast counter, the kitchen window over sink is another spot to add appeal and […]
Indian homes place equal importance on pooja room door designs as they do on main door designs. With diverse and unique ethnic backgrounds, every family strives to reflect their personalities and identities in their designs. These identities can encompass religious or spiritual interests, local contexts, or other personal elements. This series of blogs, featuring 50 […]
The door design for main door is a defining feature of any Indian home, embodying both style and cultural significance. In a country rich with diverse architectural traditions, the entrance to your home reflects not only personal taste but also cultural heritage. Whether you’re drawn to the intricate carvings of traditional Indian door designs or […]
Pillar design is a cornerstone of architectural elegance, seamlessly blending structural support with aesthetic appeal. Our blog, “50 Best Pillar Design Inspirations,” celebrates this essential element, showcasing a variety of styles from classical Doric and Ionic to contemporary and avant-garde innovations. Whether you’re an architect, interior designer, or a design enthusiast, these pillar design inspirations […]
The integration of screening evergreen trees serves as an artful blend of practicality and natural beauty. These screening evergreen trees, with their lush foliage and diverse benefits, play a crucial role in enhancing privacy. It also blocks unwanted views, and contributes to the overall well-being of homeowners. From the majestic Jamun trees to the versatile […]