Essential pieces of the productivity puzzle No 3: Infrastructure
Improving productivity has become a top priority for the UK. But what are the factors that make the biggest difference? The Productivitypuzzle.com website looked at the importance of having an infrastructure to deploy the culture in an engaging way.
According to Office for National Statistics figures, in 2015 UK workforces are 31% less productive than those of the US and 17% less productive than the rest of the G7 countries. This is despite workers in the UK working similar hours to elsewhere.
The 2015 What’s killing UK productivity survey also found that just a third (35%) of British employees are highly engaged at work, while 50% were moderately engaged and 15% had no or low engagement.
It has been Unipart’s experience within our own company and within our clients, that creating an infrastructure to deploy a culture of engagement is essential in fostering capability to continually improve productivity within an organisation.
Unipart’s proprietary business system, The Unipart Way, provides for such an infrastructure that enables employees to learn while working, solve problems, gather and use data effectively and share best practice.
But Unipart has found that creating an infrastructure is not just about having processes in place. It includes the so-called ‘soft’ cultural issues that inspire people.
In his paper, “Productivity: There’s a better way”, Dr. Steve New from Oxford University suggests that a core element of that culture is respect.
“Asking people to treat workers with respect is not the same as asking for a workers’ paradise. It doesn’t involve, necessarily, lots of perks or extra benefits. It’s not, necessarily, about particularly generous working conditions or premium pay. It’s not about being soft-hearted towards poor performance.
“But it is about according workers credit for their normal human capabilities. Productivity can often only be improved with the direct involvement of the people who do the work, and they will only get involved if treated with respect.
In their report on a survey of 10K small business participants, Goldman Sachs extend this idea of infrastructure to a national ecosystem that will encourage particularly small businesses to drive productivity through innovation. The report states:
“Ecosystems and infrastructure need to be supported and enhanced to encourage and stimulate SMEs. This includes, but is not limited to:
- The support of the private sector and the opportunity for expanded scale and impact through the establishment of public-private partnerships to deliver world-class business support to SMEs.
- The role of national and local government in supporting and encouraging SMEs. Credit should go to the UK Government and its recent initiatives, including the Government’s Business Growth Service, UKTI, Local Enterprise Partnerships and the finance organisations referenced in this report for their work in this area.”
Creating such an infrastructure may be a fundamental requirement for government and the private sector working together to improve productivity, particularly for SMEs.
As the SME sector is seen as an essential part of the government’s growth initiatives, addressing productivity enables in the sector would appear a sound economic strategy.
In the third Albion Growth Report, which was published in 2015, the findings underline the importance of productivity as a key indicator of SME growth.
Of those companies that predicted increased productivity, the vast majority (89 per cent ) also foresee growth, compared to just 61 per cent among all firms. Similarly, of those firms that see their productivity stagnating, only 36 per cent predicted they will grow.
Creating the productivity to support a culture of ambition and productivity across the sector may be the critical element in inspiring and supporting growth.
Productivity: There’s a better way by Steve New, Associate Professor at Oxford University’s Saïd Business School
Unlocking Productivity – Goldman Sachs report
What’s Killing UK Productivity
The third Albion Growth Report
Author: Frank Nigriello
Director of Corporate Affairs at Unipart Group Ltd