How to Make the Shift from Hourly Work to the “Work Done” Model

Take a peek behind the scenes of almost any company and you’ll find the same formula - employees toiling away to earn an hourly wage. But as the workplace becomes more efficient, via tech tools and a greater understanding of human psychology, it’s becoming increasingly clear that this model has outlived its usefulness.

Insistence on tracking work by “hours worked” rather than by “work done” isn’t just refusing to adapt with the times. It can have serious detrimental effects on your team and organization as a whole. Post-pandemic, the world is moving into a new era. For employers, this provides a timely opportunity to reassess how to evaluate and reward performance. We’re collectively moving towards a “work done” model, and this involves a few shifts on the part of management and company culture.

The downsides of tracking work by the hour

Some work still needs to be tracked by the hour, such as billable hours for lawyers or IT support. Where such a model does not exist, assessing productivity by the quantity and quality of completed work over hours put in makes far more sense to enhance productivity and retain employees. Here are a few reasons why the “hours worked” model does not work for today’s workplace. 

It’s counterintuitive

When you view the working day in terms of hours at a desk, you incentivize your employees to take longer on tasks. 

If your star staff member can race through three projects per hour but their less able colleague can only manage one, you’re creating an environment where the former is punished for her productivity - earning the same wage but doing more. In that workplace, it won’t take staff long to figure out that they may as well dilly dally around a task rather than be efficient.

It creates a toxic culture

This kind of unfair imbalance can quickly lead to resentment and distrust among teams. More conscientious workers may start dragging their feet while others grow frustrated.

It also increases the likelihood of burnout as managers load their efficient employees up with work, knowing they’ll get it done but lazier colleagues won’t. This could end up with your good employees walking out, leaving you with those who don’t work as hard. 

It encourages employees to game the system

Unscrupulous employees can easily take advantage of the hourly wage system, delaying tasks so that they stray into overtime and earn more for projects that could have been completed during the working day.

It offers less flexibility

The pandemic prompted many to readdress their work/life balance and staff are now looking for more flexibility in their work schedules, with some even making it a condition of their employment.

Hourly wages tie teams down to clocking in at a certain time and clocking out again. Whether they take that time all at once, or segment it, they’re still constricted by the calendar rather than working task by task and managing their own time.

Given the continuing labor shortage, this rigid adherence to the clock is likely to increase staff turnover and attrition as employees will readily job hop until they find someone who can offer a more flexible approach.

Be careful not to reward productive employees with more work

Hours still need to be used by managers as a way to schedule employee time and estimate the amount of time they expect should be spent on a deliverable. If a team member finishes a task ahead of time, their reward should not be more work heaped on because they can “take it” where other employees cannot. Instead, consider fast-tracking these employees for promotions to management if they continue to deliver quality work ahead of time. Instead of more work,  try rewarding them with more time to think about their next project or complete any ongoing work they may have. 

Additionally, you may want to make it clear in company culture that finding efficiencies in process and tasks could net a fast track to promotion rather than making someone simply a workhorse. That will inspire employees to pull together and get things done well and on time, rather than just “putting in the hours” for pay.

Time Management Training

In order to shift from an “hours worked” to “work done” mindset on a larger scale, your company may want to offer regular time management training to encourage employees to use their time better. You may also want to offer them the tools they need at an individual level to block off time - this can range from scheduled focus time added to their calendars to software solutions designed to block all but the task they should be focusing on. 

KPIs not calendars

When managers take an hour-by-hour approach, they have to be very careful they’re rewarding productivity. 

Performance-related pay, based on measurable results, can help companies acknowledge their stand-out employees while incentivising others to catch up. But this approach relies on first defining productivity, and then finding a way to accurately measure it.

Employee Productivity Monitoring solution Prodoscore can help. Created as an unobtrusive and objective way to gauge employee engagement, the innovative platform monitors how employees interact with company tools to give a comprehensive picture of how they work. 

Prodoscore doesn’t trawl through personal data, track mouse movements, or count clicks. It simply gathers information across core business processes to compile team and/or individual productivity scores so managers can gain better visibility into their team’s daily activities.

With this kind of oversight, managers can better reward employees who hit their KPIs rather than those who are just running out the clock. This, in turn, increases employee satisfaction, offers accountability, and increases transparency - especially among remote or hybrid teams who are at risk of becoming isolated and withdrawn. 

How will visibility impact your business?