Study Shows Employees Remain in Their Positions Long After Productivity Has Declined

High-performing organizations not only weed out unproductive employees faster but also bring new employees to full productivity in less than a year

The Institute for Corporate Productivity (i4cp) has released a new study titled Time to Optimal Productivity that shows a clear delineation between high- and low-performing organizations. The study reveals that over half (55%) of respondents from low-performing organizations report that employees often remain in positions after their productivity has begun to wane. The same is true for only about a fifth of those from high-performing firms. A total of 312 respondents participated in the study.

“Sometimes patience is not a virtue, and high-performing firms know it,” says Jay Jamrog, i4cp’s senior VP of research. “They get their employees ready quickly, they avoid employee stagnation, and they weed out those who don’t come up the productivity curve.”

Time to Full Productivity

According to the study, high-performing organizations tend to move faster: even in a slow economy. When respondents were asked about the time to full productivity in their companies, 45% of those from high-performing firms said this occurs in 12 months or less, compared with just 32% of those from low-performing firms.

“There are plenty of ways to shorten time to full productivity,” notes Jamrog. “Better employee orientation and onboarding, job shadowing, better access to informal learning tools, improved peer coaching and, generally speaking, higher-quality learning and development programs. It all adds up and results in a faster track to full individual productivity.”

In spite of the potential productivity gains, the study also found that many companies don’t even bother to track time to full productivity. In fact, only about six out of 10 organizations use this metric, and high performers are no more likely to use it than the average company.

The important differentiator is that when they use this metric, high performers use it more effectively. Specifically, they’re much more likely to make both termination and recruitment decisions using time to productivity as a factor. “With high-performing firms, it’s all about making sure you have the right talent,” says Jamrog. “They’re more likely to use that metric to get rid of less productive people, and they’re likely to use it to gain insights into who to recruit. In other words, they’re more structured about who to bring in the door and, if necessary, who to release.”

Maximum Time in Position

The i4cp study also asked companies about “maximum time in position,” which was defined as the maximum amount of time that employees can stay in the same position before their productivity falls off from the optimal level. The study found that this is not a common metric in today’s organizations, with over half of participants reporting that they don’t estimate or calculate it for any positions.

“It makes sense to use it for succession planning,” notes Jamrog. “You don’t want to keep up-and-coming managers in a job so long they become unproductive there. You want them to have some success and then move them along to the next level.”

Click here for information about how i4cp defines a high-performing organization.