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Q & A: Jack ZengerMeasuring Up

Are your employees as productive as they can be?

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This story appears in the November 1996 issue of Entrepreneur. Subscribe »

Would you like to double your profits? Outrageous as that goal might seem, there's a fast way for most businesses to dramatically increase profitability: Just tweak worker productivity. Little gains in productivity turn into big profits fast, says Jack Zenger, chairman of Times Mirror Training Inc., the world's largest group of employee training companies (among them: Zenger Miller and Learning International). "Increasing productivity by only 5 percent can increase profits by 50 percent," promises Zenger.

Here's how Zenger's arithmetic works: In most companies, costs associated with labor comprise half or more of total expenditures. "Assuming the business has a 5 percent return on sales, a 10 percent increase in productivity will double profitability," says Zenger.

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