Measuring Productivity in the Modern Workplace: A Game Nobody Is Winning
The r/antiwork subreddit is filled with white collar employees describing the seventy year old art of appearing useful — out of necessity, of course. Another exclaimed that the most exhausting work they had ever done was waiting to be needed and trying not to look like they weren't already working. No one says anything because people simply want to keep their jobs.
They've been subjected to playing charades because the productivity of a knowledge worker has never been measured. And any previous attempts have failed, horribly.
How do you measure the output of an employee that is intangible? How can a knowledge worker demonstrate their value if it isn’t directly tied to a dollar amount?
The Definition of Knowledge Work
Since the definition for knowledge workers is broad, I would like to point out a specific subset of knowledge workers. These workers typically have a white collar career working on tasks using their judgement, critical thinking, and problem solving to either avert risk or grow capital for a company.
As a knowledge worker, once you’re off the production floor, determining how valuable you are becomes questionable.
Many redditors question completing their work assignments within four hours, or mention having to spread their workloads across the day in fear of appearing idle for too long. This is performative productivity. As a result, the cognitive dissonance — the sustained mental strain of having to hold two contradictory realities at once. The work is done, but the day is not and you’re stuck.
This had been eroding the morale of knowledge work employees for decades.
From the Factories of WW2 to Modern Offices
Measuring productivity in a factory store was simple. One can quickly see how many units were produced by an employee within a specific period of time. Prior to the automation and offshoring of customer service work, employers could track cases per hour and average handle time. These metrics worked when the work was repetitive, physical, and identical across most employees.
Employers copy and pasted the productivity system used for factories to knowledge work even if it didn’t make sense. Once the labor mix shifted to knowledge work in the 1950’s, no one ever found a way to measure knowledge work productivity.
As a result, employers are now tracking the most meaningless statistics and a lot of knowledge workers have fallen victim to this. So what actually gets tracked in the modern knowledge workplace? Three things and none of them are productivity.
Presence.
Are you in the building? Is your Slack light green? Did your badge scan at the right time? Are you on camera?
Presence became the default metric not because it measures anything meaningful but because it is the only thing that is easy to see.
Perception.
How do you present yourself in meetings? Do the right players know your name? How busy did you look doing it?
Perception is entirely qualitative and entirely political and it rewards visibility over value and confidence over competence.
Quantity.
How much did you produce? How many things did you touch?
The person that attends every meeting and responds to every Slack within five minutes looks like a star employee. The individual who spent a week solving the one problem nobody else could look like they weren't doing anything at all.
Quality.
Quality is the thing nobody is measuring. The judgment, the institutional knowledge, the catch that saved the operation… none of it shows up in the system. And if it doesn't show up in the system it doesn't exist at review time.
The gap between what gets measured and what actually matters has been widening ever since.
If you didn't participate in the latter 3 so-called metrics, then you were expendable. It didn't even matter what value was in your knowledge. For example a compliance analyst that could avert a $3 million loss was let go, but companies don’t measure the outcome —there were no losses.
Calculating the Value of a Knowledge Worker
There are 2 main reasons why knowledge workers are susceptible to being valued at nothing at all. Accountants typically have a ledger with two columns: the cost of production and overhead.
Since knowledge workers do not technically produce anything, they simply were lumped in with overhead.
In 2014, the BLS Division of Major Sector Productivity stated
“"The real gross products of general government, of private households, and of nonprofit institutions are estimated primarily using data on labor compensation. The trends in such output measures will, by definition, move with measures of input data and will tend to imply little or no labor productivity growth. Although these measures are the best available estimates of non-market components of GDP, including them in measures of aggregate productivity for the economy would bias labor productivity trends toward zero."
This practically says your work is essentially worthless or in economical terms — the math is circular. While you’re up at night chugging energy drinks and breaking your brain strategizing, writing up plans, crunching numbers, and making high stakes decisions, no one is counting.
Drucker, who coined the term "knowledge worker" even stated that tools built for factory output don't transfer to the office. He spent most of his life trying to solve this problem.
Exploitation of Knowledge Workers
When no one can define what you produce, the terms of your employment stay permanently in someone else's favor. Your raise is discretionary and your job security remains questionable. Although your role has a market value attached to it, that is only defined by
Supply and demand of knowledge workers.
What other companies are paying for the same title.
What the labor market will bear at a given moment.
It has nothing to do with the actual output of the person in the role.
The ambiguity that was never resolved in 1959 is the same ambiguity works against you in your performance review.
Think about what the absence of a framework actually gave corporations.
No measurable standard means every decision about your compensation, your responsibilities, and your future sits entirely on their side of the table.
Your role can cross the boundaries of your job description without a pay increase because nothing was ever formally scoped.
The Economic Policy Institute tracked this for decades. Between 1979 and 2019 productivity grew 85%. Worker pay grew 13%. The other 72% went to shareholders and executives.
EPI called it a failure by design. Wage suppression increased due to numerous policy choices that resulted in an excess of unemployment, eroded unionization, increased corporate globalization, and lowered labor standards.
Exploitation in the economic sense means someone is capturing the value of your labor beyond what they compensate you for. None of this required a meeting where executives decided to exploit knowledge workers. The absence of a framework was profitable and convenient. Solving it never was.
Then All Hell Broke Loose
Then the onset of the pandemic thrusted many employees and employers into an experiment. Remote work finally gave the knowledge worker the breath of fresh air they needed. Instead of focusing on Taylorism metrics from the factory, they were able to feel work life balance, in real life.
The pandemic had an even darker side that was going to throw knowledge workers for a loop. Low interest rates created a hiring frenzy between 2020 to 2022. Once the feds increased the interest rate in February of 2022, the hiring ceased and now the companies were left with a lot of employees counted as “overhead” or in their words “dead-weight”. There were more employees than work to go around and companies were looking for a way out fast.
Layoffs don’t look too good in the papers so companies began implementing Return to Office. A lot of employees were willing to leave once they were required to commute again. When RTO didn't work, companies had no choice but to double down and enact 5 days a week in the office, or to turn to layoffs. Especially when the great AI race began. And AI aint cheap.
Visibility replaced accountability once again because visibility was available and true measurability was never created. That required someone to actually solve the problem Drucker mentioned in 1959.
Nothing seems to truly measure the true worth of the knowledge worker.
Attempts of Measuring Thought
Companies have tried to find ways to determine the output of knowledge workers, but products like BetterWorks and 15Five fail to measure productivity. They measure whether you wrote your goals down and how you felt about your week.
Both Saas products are sold to human relations departments as performance management solutions. But neither one can measure what a knowledge worker actually produced.
BetterWorks is a platform for tracking Objectives and Key Results (OKRs). 15Five is a weekly check-in tool that has OKR tracking added as a feature. The name comes from the idea that an employee should only spend 15 minutes writing it and a manager should spend 5 minutes reading it.
Both platforms were problematic because self reported goal completion does not paint the full picture. There’s evidence that both companies are fully aware that their solution does not close the gap in productivity tracking. Neither product tells you what a knowledge worker actually produced.
On the Betterworks blog, in 2023, CEO of Betterworks, Doug Dennerline stated that
“Traditional performance management rewards the top 20% of the workforce, dispels the 10% who are considered low performers, and forgets about the other 70% of employees whose contributions are important to the organization. Worst of all, it doesn't improve performance”.
That's the CEO of a performance management company admitting that performance management doesn't improve performance and that its mostly employees keep up with the perception of busyness.
BetterWorks also determined that 90% of leaders think their performance management process is a success compared to only 55% of employees. BetterWorks found that gap in their own data and used it as a sales pitch.
What Honest Measurement Would Require
Name the Deliverable
It would require leadership to define the deliverable before a knowledge worker begins the job. This excludes the number of hours they've worked or the number of the meetings they'll attend. Instead, leadership would measure the actual thing a worker should produce such as strategy, decisions or whether a system was built that works or if a problem stays solved.
Define a Deadline for Outcome
There is a defined deadline for the outcome. How you use the hours between now and that deadline is your business. The gaze of a manager is no longer something a knowledge worker would have to worry about. If you need 75% of the agreed upon time or need all forty hours that's fine. What matters is whether the output meets the standard by the agreed date.
Determine How Outcomes Are Weighted
A consultant who writes a single memo that saves a company $10 million produced more than someone who wrote fifty slide decks nobody read. Any honest framework has to account for the weight of the output and not just the volume.
Lag Time Acceptance
Some knowledge work outputs don't show results for months. A hiring decision. A market entry strategy. A product architecture choice. Honest measurement would have to accept that the output of thinking often can't be evaluated the same week it happened.
Conclusion
An issue that was named in 1959 continues to remain unresolved.
The Bureau of Labor Statistics admitted in 2014 that measuring knowledge worker output makes the math circular so they removed the category entirely. Academics published papers in 2004 and again in 2020 concluding there is still no universally accepted method to measure the output of thinking.
Presently, corporations found a solution to a problem it wouldn’t solve. They implemented measures to track your presence and how often you appear busy.
The silence in that room where you finished your work at 2pm is not awkward. It is the most honest thing about the entire arrangement. No one built the correct and ethical framework because it would change who holds the leverage.
Sources:
Sources:
Peter Drucker — The Landmarks of Tomorrow (1959); "Knowledge-Worker Productivity: The Biggest Challenge," Harvard Business Review (1999)
Ramírez, Y.W. and Nembhard, D.A. — "Measuring Knowledge Worker Productivity: A Taxonomy," Journal of Intellectual Capital, Vol. 5, No. 4 (2004)
Bureau of Labor Statistics — "What Can Labor Productivity Tell Us About the U.S. Economy?" (May 2014); Division of Major Sector Productivity methodology documentation
Economic Policy Institute — "The Productivity-Pay Gap": productivity grew 85.1%, worker compensation grew 13.2%, 1979–2019
Doug Dennerline, CEO of Betterworks — "Reimagine Performance Management to Make Work Better," Betterworks (September 2023)
Betterworks — 2024 State of Performance Enablement Report (survey of 2,000+ employees and leaders, U.S. and U.K.)
