Productivity has certainly come to the fore in the past few years like never before, why? Despite all the opportunity technology has brought business all the statistics point to a long slowdown in productivity growth since the 1970’s in western economies and in Northern Ireland we remain at the same level of productivity as were at in the later 1990’s which now sees us working 20% harder to just achieve the same output as our colleagues in England and over 35% harder than those in France, Italy, Germany and United States.
The slowdown, if true, and some sectors are outperforming the statistics, matters. Paul Krugman the Nobel laureate argued, “Productivity isn’t everything, but in the long run it is almost everything.” Sustainability and competitiveness of the organisations we lead and improvements in the standard of living depend almost entirely on the rising output per worker.
That leads us back to Seth Berkley, as leaders how can our vision impact productivity for our business and wider society and how can we be responsible leaders in delivering this? In an age of constant disruption, the potential impact of technology such as artificial intelligence why is the transformative power of these not impacting productivity positively?
Innovation in Processes & Products
While no one can argue that there has been significant advancement in product innovation over the past 2 decades and we have some of the leading R&D activity within business and our universities, paradoxically there could be argued a reducing element of process innovation.
As we move further forward as a knowledge driven economy, innovation in human capital, working practices, business processes, manufacturing processes is more vital than it has ever been. Our economy, due to changing demographics, will become driven as much by health & domiciliary care, education and similar activity, how do we innovate in these areas in terms of delivery?
Can we create the vision, leadership and take responsibility for investing in the technology, but equally important the people who make our businesses and organisations what they are? According to the latest Employer Skills Survey (IFF / Dept. of Education, Westminster) only 45% businesses in NI have a training plan and 14% consult with their employees!
In 2008 government intervened with support for the economy through funding business improvement training for staff to help lift the competitiveness during the financial crisis, the need has not gone away and as leaders we must have the vision to invest directly in our people to deliver change.
Investment in Leadership
In his book, Will it Make the Boat Go Faster, Ben Hunt Davis (Gold Medal, Rowing, Sydney 2000) focuses on 3 crucial elements of leadership, all of which directly impact on productivity and leadership. These may see pretty obvious in themselves, but when was the last time as a leader you took time out to:
- Focus on what’s important
- Focus on performance, in order to get results
- Work together effectively
If our businesses or organisations are going to remain or become truly competitive or productive, take stock, look at our leadership and vision and invest in developing the kind of leadership that will make a real difference.
This can take many forms, for Lush it was about taking the decision to move to the Living Wage Foundation living wage rather than the government living wage at a time of loss making and business challenges, a year later this decision was attributed as key to moving from loss to profit. For Greggs it has been about giving everyone in their stores the opportunity to sample store supervision and management, unearthing hidden potential and improving customer service in their stores.
It could be taking time out to attend an IoD Academy course to develop your leadership knowledge, enabling the development of innovative strategies for use of your team members or new and emerging technology.
Developing productivity for this small region can be truly transformative for business and wider society. If all businesses in the bottom 3 quartiles of business productivity lifted their performance by just 10% the impact would be the release of circa £2billion into the economy. This is the opportunity in front of us, productivity leadership can create something special for this region, take the time to invest now, the return will be well worth it.