Productivity through People

Productivity through People

 

Australia’s productivity rates are going downhill

Did you know, that over the last decade or so, Australia’s productivity rate has seen a continuing decline?

The most common measure for productivity performance is labour productivity, which measures output, per unit of labour input.  Another, more comprehensive, way of measuring productivity is the Multi-Factor Productivity or MFP which includes not only labour inputs, but also capital, and other sources of productivity.  Both measures show an ongoing decline, so no matter how you measure it, there is no doubt that productivity is in serious trouble.  Increasing the rate of productivity growth is central to rising living standards and sustainable economic growth.

The effect on the economy

This is, of course, concerning to not only organisations (and their CEOs) who are seeing their profits even further eroded, but also to governments and industry bodies.  This is because much of the negative commentary around productivity tends to blame government policies and/or excessive business regulations.  Despite the current rhetoric surrounding the cause and effect of policy and economic decisions on productivity, it is not my intent to add to the debate today.  I have no doubt that there is an urgent need for serious and challenging, long-term policy decisions, but that is a discussion for another post!

Where do we go from here?

Instead, I want to focus on what we can do as business owners, managers and HR Professionals to halt the decline of productivity at the local level and ensure that, at least your own company is able to implement strategies to grow productivity and in turn grow both profits and long-term business sustainability.

The Australian Government’s much toted and quoted report on the ‘Asian Century’ notes that most of what is required to lift Australia’s productivity is in the hands of individuals, especially managers of businesses.  It goes on to say that productivity will emerge through innovation in business processes within firms and more sophisticated relationships. To truly unlock productivity, we need workplace leadership, skills and a culture that encourages innovation and employee engagement.

Achieving productivity through your people

The two biggest factors are the engaged employee and the manager as an efficient and effective leader of people.

Studies have shown that Australia ranks well behind other advanced economies in management skills and capability, particularly in engaging workforces and instilling a ‘talent’ mindset.

It seems to me that many managers just don’t get it.

In this decade where all the factors you need to run a successful business are literally at your fingertips – a click away – businesses are truly at the hard end of the competitive stick. It has become almost impossible to identify a competitive edge aside from people.  In fact people – the human capital of the organisation – are now and finally, the only real competitive edge any business has in this new global economy.

It is your people that make the difference between a good business and a great business.  It’s your people who quite literally have it in their collective power to make or break a business.

As melodramatic as this might sound, it’s true.

Yet many organisations act as though this is simply not the case.  They treat their people with disdain, using and discarding them!

Sweeping the problem under the rug

When I talk to organisations about their bottom line they know they must do something, but their people are often not on their radar.  I’m not sure what it is about ‘people management’ but as soon as you mention it, the interest is, so often, lost.  If you suggest the latest gadget to increase the business’ productivity, they’re interested.  But as soon as you suggest the problem lies with their people, there is often very little associated value.  There is, often, simply no acknowledgment that with some help and support their employees are the ones who can turn the business around.

So, who has the power here?  The two groups best placed to have maximum impact on an organisation’s performance are frontline managers and supervisors, and employees themselves.

Workplace skills are a key driver of productivity improvement.

Frontline managers and supervisors need to understand and be committed to the concept of employee engagement and the direct link this has to increased productivity. This means we need to take the time to actually develop and train our frontline managers and supervisors.

We need to introduce them to leadership and the skills required to shape a positive, committed workplace culture, build highly productive teams and drive people performance.

Underlying this is the concept of what it means to have an engaged, committed and motivated workforce and why it is so business critical.

We must develop our frontline managers and supervisors to think outside the square, to solve problems, make decisions on the run, look for, identify and foster innovation wherever it appears.

It is only when frontline managers and supervisors value their people, and they’re equipped with the skills and knowledge can we be confident of a positive, sustainable future.

Then we can look forward to strong business growth year on year.

Get the skills needed to excel

The College for Adult Learning has just introduced its new online Diploma of Management that is perfect for frontline managers and supervisors. This complements its hugely successful Diploma of HRM that deals with people & performance in great depth.

The College has also just launched a new bundled skill-set program ‘Productivity through People’ that provides a broad general grounding in these essential skills and knowledge.

Helen Sabell, CEO, College for Adult Learning
Helen Sabell, CEO, College for Adult Learning

The College For Adult Learning

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