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Growth Through People: Growing productivity

Huber Muir

This blog post has been produced in support  of the GBCC’s Growth Through People campaign. The views expressed by the author are their own and do not necessarily reflect the position of the GBCC.

Huber Muir, Organisation Specialists, are delighted to be supporting the Greater Birmingham Chambers of Commerce "Growth Through People" Campaign in February 2017.

We know that British productivity is 15% below the pre-financial crisis level. We also know that British workers' output per hour is some 30% below their counterparts in the US, Germany and France. That's bad news.

And yet Government, and the Media, tell us the British economy is performing well relative to other major countries, with high economic growth and record employment levels. So does poor British productivity really matter? You bet your life it does!

Productivity growth matters because it drives a "virtuous circle" of economic growth, which is good for businesses and their employees.

Productivity growth improves business income and profitability. This enables businesses to increase investment in physical and human capital, which further improves business profitability - there lies sustainable economic growth!

There's more good news. Improved business profitability, driven by productivity growth, enables businesses to improve employees' pay levels. This motivates employees to agree more efficient working practices, which further improve productivity, profitability and pay levels .....

Also, improved business profits and salary levels increase the Government's tax take. This enables improvements in public services, which, in theory, improve productivity.

However, let's not rely too much on Government promises to improve productivity. They already plan major investments in transport links to improve productivity - well, let's see how that works out. Governments tend to invest in the wrong projects, over-complicate the spec, over-run on costs, scale things back, delay build start-date, over-run on completion date, and end up with transport links which don't quite link!!

So what to do? We business folk need to help ourselves and help each other to improve productivity. And, by focusing on SMEs, as the Chamber's "Growth Through People" Campaign is doing, we can transform our economy.

Now, some good news and bad news on the productivity front. The bad news? Surveys suggest there ain't a great deal of employee commitment in the typical British company:

  1. only 30% of employees are actively committed to their job
  2. 50% of employees just "put their time in"
  3. and most worrying, 20% of employees are discontent, and act in counterproductive ways

That's depressing, isn't it?

The good news? Making small changes in how leadership teams manage their employees can improve the above percentages, and facilitate ongoing productivity improvements. Such changes will be covered in the Chamber's "Growth Through People" workshops. However changing the way employees are managed can be disruptive, for both the general workforce, and for the leadership team. This may involve some tricky situations, and possibly conflict within the leadership team. Huber Muir can help here.

Huber Muir partners, David Huber and Archy Muir, work closely with senior executives, helping them manage their organisations more effectively. During February, they are offering workshop attendees a confidential, one-to-one discussion on how changes in "policy and practice" might be implemented successfully in their particular business.

If you would like to book a one-to-one session, please email archy@hubermuir.com