One thing is clear from the myriad of UK statistics; a huge number of UK companies just aren’t productive.
They may be working hard for their customers and stakeholders, but they just aren’t working smart.
Here is the evidence
• Productivity (measured as output per hour worked) is as a huge 18% below the G7 Average (ONS) and the widest since 1995.
• If we compare the UK to EA/EU productivity growth (2016) we are just above Italy and Greece in the group of 32 countries.
• Historically our productivity growth was 2% per year. Since 2007 growth has evaporated and as of 2017 (Q2) we are .5% below 2007 levels.
• To put this into perspective we are 20% poorer due to productivity stagnation than we would have been had productivity continued to improve at 2%.
• These figures are bad enough but when you remove London (home to the Finance Sector and 32% higher than UK average) from the figures productivity is even worse than the headline figures.
How does this affect your business?
The statistics reveal that the problem of poor productivity is not a problem that affects “some other business” but to some extent and degree most businesses. Poor productivity results in loss of competitiveness, reduced profits, wage stagnation and skill/staff attrition. If any of these resonate then you may also be one of the many and not the few.
Whose fault is it anyway?
Whilst it is true that national infrastructure (Rail/Roads/Broadband) contribute towards productivity gains (something the government is “working on”) this is just one factor which is outside of the control of business. The other critical and contributory factors remain with the CEO and the company board.
A task too often focused on maintaining the status quo rather than constantly striving to improve the efficiency of their area of responsibility.
Ensuring your staff are continually trained to perform their tasks at optimum performance. Improving skills not only increases output it also reduces rework though improved quality.
Outdated paper-based and unwieldy processes that simply burden staff and reduce their productive time must constantly be identified, reworked and automated.
The ability for technology not only to automate processes but transform them is no longer a vision but an everyday fact for most high-tech business. Both process transformation and (technology) automation should be viewed as a single inseparable goal and activity.
Planning & Measurement
The transformational impact of technology enables not just improved planning but also real-time measurement enabling a business to close the loop on productivity initiatives and implement continuous improvement easily and cost effectively.
Where do I start?
For many businesses the answer is simple and that is to measure the output per hour worked. One of the biggest costs for businesses is staff and highly productive companies have the following information at their fingertips and often in real-time;
• Where are my staff?
• What are they working on (activity/task/client/contract/customer)?
• Are my staff working patterns aligned to business demand?
• What changes must be made to align staff to business demand and avoid unnecessary downtime, overtime or unproductive time?
• What is my team’s overtime, absence and unproductive time today/this week/this month?
If you cannot answer these questions simply and quickly about your greatest and most expensive asset (your staff) then you cannot even start to identify issues, implement improvement plans or measure the effectiveness of those plans.
Nor have you laid the foundations for continuous improvement.
The biggest mistake companies make with improvement projects is that it is a one-step process rather than a continuous never-ending cycle that is impacted by technology, methodology, tools, training and materials.
Above all, its time to measure, not once or twice but constantly to ensure improvements are not one-off but continuous. The UK needs a Productivity Reboot and businesses should not wait for the government to make it happen but make the changes only business can make. That time is now.