Get More Out Of Your Day With Increased Productivity
Productivity is one of the main drivers of profitability and growth in your education business and is therefore very important for business success. All businesses face similar challenges in terms of time, capital and talent limitations, but productivity allows you to achieve more from these limited resources.
Increased productivity can benefit your business in the following ways:
You can deliver better value to customers
Increased productivity and efficiency will allow you to provide customers with better value for money. You’ll be able to charge less for a specific level of service while still generating more profit than a less productive competitor.
You can save more time
You can quickly reduce the demands on your time by improving your own productivity as well as the productivity of your team. This will help to reduce stress and give you more time to focus on other areas of your business.
Higher profitability is possible
Spending time on increasing your business’ productivity will definitely pay off in the long run as productivity is one of the best ways to increase profitability.
It makes your business more durable
The more productive your business is, the easier it will be to survive a slowed economy. A business with low productivity will quickly become unprofitable during a downturn, whereas a productive business can continue to be profitable during a lull.
It ensures higher value when selling
If selling your business at some point in the future is a consideration, you will definitely benefit from improved productivity. An already productive business will sell at a higher price since many of the principles used to make a business more productive also makes a business more attractive to buyers.
It makes franchising a viable option
As your business’ productivity increases, your return on investment increases as well, making it more attractive to potential franchisees.
What Exactly is Productivity?
Productivity is a ratio that describes the relationship between inputs and outputs. This ratio measures how much of an output you can produce from an input.
For example, in the context of an education business, the primary input is generally labour (other inputs can include things like money spent on software, learning materials, buildings etc). The primary output is generally education and this can be measured in a few different ways such as hours taught, number of lessons taught, or revenue.
Productivity can be measured by relating these inputs and outputs to each other. For example, the following measures of productivity could be used for your education business:
- Revenue per teacher/employee
- Lessons per teacher
- Hours per teacher
While these ratios are effective methods for measuring productivity, they may not always give you the full picture. A teacher may have a very high lesson count compared to other teachers, but the total revenue generated from these lessons might be lower. In this case, the teacher appears more productive than others, but they aren’t generating more profit for your business.
A good way to account for this is to measure inputs and outputs in monetary terms. Using the “Lessons per teacher” ratio as an example, you may offer multiple services with varying rates. By converting lessons into the fees generated by the lesson, you can account for the extra value of lessons with higher fees. This method allows you to compare teachers with different mixes of lessons.
If you’re like most education business owners, you’ll definitely understand the frustration of not being able to finish all the tasks you wanted to complete for the day. While we can’t add more hours to your day, we have developed a productivity framework that will allow you to get more done in the same amount of time.
Interested to learn more? Download our FREE e-book here.