Cracking the productivity challenge

By 07/08/2017Blog, News
productivity

UK productivity is, according to latest reports, at an all-time low. The impacts of this decline is being described as ‘Bigger than Brexit’ in terms of damage to the UK economy. A recent BBC article states that: “Today’s productivity figures are bad to the point of shocking.” It goes on to detail a fall in productivity of 0.5% in the first three months of the year taking “the UK economy’s ability to create wealth back below the level of 2007”. This is uninspiring reading for us all, as we face unprecedented challenges in business and on political, environmental and social levels.

When looking at the CIPD’s latest ‘Employee Outlook’[1] report, there is small wonder about this decline. The report provides the latest employee engagement figures and highlights the extent of the challenge we face in reversing this productivity trend – just 21% of our workforce (across sectors) identify as actively engaged in their work.

Efficiency has been described as ‘doing the same with less’, whilst productivity has been described as ‘doing more with the same’.

More with the same requires tapping into the ‘human’ secret sauce i.e. the discretionary effort of people. Put simply, it is here we have an Achilles heel. According to a recent Bain and Co. study[2], the efforts and energy of the truly engaged equate to a 125% more productive employee, relative to a ‘satisfied one’. To have an ‘inspired’ colleague on board, is worth 2.25x more than a merely ‘satisfied’ colleague. All of this translates into a compelling bottom-line argument, bolstered by ‘engaged’ workforce operating margins up by 30-50%, and well-evidenced faster growth.

Here in the UK however, we have some work to do to achieve the high engagement that might translate into that higher productivity.

The good news is that we know where to start: if we have the appetite to do so. The CIPD report reveals that only 20% of employees rate their organisations as ‘very considerate’, with the worst performing being the public sector (13%) followed by the private sector (17%). It would seem then, that we have a good deal of low-hanging fruit from which to pick first. In moving towards a more ‘servant leadership style’ there is now a more compelling argument to see the role of leaders as one of curators, and as caretakers of a system that needs nurturing – as well as directing.

Against the backdrop of a growing national mental health challenge, only 14% of the CIPD survey base would feel confident to disclose mental health issues, and only 19% believe the performance management system in play to be fair. Additionally, 30% of staff consider themselves to be overqualified for their roles, with attendant impact on morale and satisfaction. This would seem to give us a good deal of information on how we might improve things, should we be moved to do so.

So who is doing it well? According to the Bain and Co. study; Netflix, Apple, Dell and Google are among the ‘Productive Elite’ with these organisations showing a 40% higher level of productivity than others. How do they do it? They align their ‘A Players’ (every company has them, but not all know how to place or team them for maximum effect) around the organisation’s most critical missions. They ensure that time and energy is expended on uncovering a personal purpose and aligning that to the organisational purpose. They build cultures of high autonomy and accountability when designing their systems and processes. From hiring to rewards; from entry to exit; they ensure that their people can be their very best selves at work.

If the UK is to crack this ‘productivity challenge’, we would perhaps do well to first consider Dan Pink’s findings on human motivation. Contrary to received wisdom, people are not motivated by money, status and power: but instead by autonomy, mastery and a sense of shared purpose and endeavor. It is this way of thinking that places profit firmly in its place – as a condition and an outcome of business, but not it’s reason for being.

Vicky Grinnell-Wright, Head of Corporate Engagement

[1] CIPD (2017) Employee Outlook Spring 2017

[2] Vozza, S. ‘Why employees at Apple & Google are more Productive’ Fast Company. 13th March 2017