The construction industry contributes a major share of gross domestic product (GDP) and has a vital role in the economic growth of countries. Thus any performance improvement in this industry enhances the economic growth especially in developing countries.

Due to the lack of reliable performance measurement models agreeable to industry and academy, this research seeks to take steps to introduce a novel  functional and flexible method for measurement, analysis and comparison of  labor productivity. Furthermore; an addition to the site organizational chart, called “Construction Productivity Management Office, CPMO”, is introduced for implementation of this method. In a case study it was shown that this addition can improve productivity indicating its practicality and capabilities. The novel method also introduces a new index called the “net baseline productivity”. This approach is based on filtering and excluding the total idle times that provides a managerial index called “Earned Performance Ratio (EPR)”. This new method can provide an objective-based approach for measuring the productivity as well as introducing a new insight into the baseline productivity. The introduction of CPMO with dynamic duty description of measurement, analysis, and comparison of productivity and its relevant indexes is one of the other achievements of this research. Effective implementation of productivity concepts can play a key role in achieving the ultimate goals of projects and organizations.