The Paradox of Workplace Productivity – Harvard Business Review

English: Productivity comparison for the membe...

English: Productivity comparison for the member states of the OECD. Productivity is Gross Domestic Product (GDP) per hour worked, as measured in US dollars. Lines for the OECD average and the Euro-zone average shown for comparison. (Photo credit: Wikipedia)

This short HBR raises an important paradox. It suggests that people have become more productive but companies, not so much.

Source: The Paradox of Workplace Productivity

Whilst I agree with the observation, I feel that the arguments to explain the paradox were too simplistic.

Let me share a few ideas.

Firstly, I feel it essential that a business has an effective strategy. Secondly, the whole business must be effectively engaged in operationalizing that strategy – this is generally not the case, particularly in large businesses.

In my experience, it’s in business processes that the most damage is done, in terms of the productivity leakage and the diluting of strategy. Processes are frequently broken, poorly designed and maintained but most important of all they are not effectively customer focused.

Next I would like to throw in to the mix two archetypes, namely the Sales Director or VP and the Finance Director or CFO.

In my experience the typical sales director is motivated by the top line irrespective of margin, marketing considerations or the business strategy. These old fashioned sales directors are dinosaurs – they are like market pedlars and they destroy effective productivity too.

As for the CFO too many are pompous without any deep understanding of the business, the markets, customers and the strategy. Many are poorly educated, fail to understand the behavioral interactions in business – they frequently struggle because they cannot articulate themselves well. For them, there is a simplistic notion, ‘the numbers never lie’. The CFO want to slash and burn, reducing the headcount and the cost per employee. So the CFO is an effective roadblock to strategy delivery and improving corporate productivity.

I could expand this blog by introducing projects but I hope the reader will indulge me that most large projects fail to achieve their objectives and water down the effectiveness of business strategy. Most important of all is the link between projects and productivity – it’s always there in the justification stage but is very rarely delivered.

So to conclude, corporate productivity is important and I suggest that it should feature in the business strategy. Finally, I would argue that it’s time the corporate dinosaurs were consigned to the golf course.

Thoughts?

Opinion – “Misery Index” at lowest level since 1950s | Brookings Institution – John Gelmini

Dr. Alf is correct in his analysis and I would question this index on more fundamental grounds.

The Misery Index was conceived in the 1970s when inflation and unemployment figures were compiled differently and before the deliberate falsification of unemployment figures that has taken place in both the UK and America. UK unemployment is supposed to be 1.8 million but 2 million people who have registered businesses which have not traded and not made their directors a penny are counted as “self-employed”, 1 million people are in training schemes but in reality not working, 1 million people are NEETS (not in education, employment or training) but they are not counted as unemployed, 1/2 million people who are not working have been “sanctioned” by DWP jobcentre advisors but are not working, another 500,000 people who are redundant are in receipt of severance pay are ” deemed to be working” because they are in receipt of National Insurance contributions.

People who are on holiday are forced to sign off, those who are “waiting to hear about benefits” are not counted as unemployed even though they are not working and a further 11 million people who are too young to retire and too old to interest ageist employers are counted as either “economically discouraged ” or economically inactive.

The Joseph Rowntree Foundation looks at this sort of thing in some detail but even they do not know the full extent of the numerical gerrymandering as it has been explained to me by several of the Governments “training for work” providers.

A further 2 million people on “Personal Independence Payments” (the successor to incapacity benefit and “Disability Living Allowance” are unable to work but not counted in the unemployment figures.

Thus, we have a situation where real unemployment and a fair amount of misery is airbrushed out of the figures without the explanations and footnotes that Dr. Alf will remember from his years of distinguished work as a Financial Director, Chartered Accountant and interim manager looking at Annual Reports and Accounts and preparing them to international standards capable of independent audit.

The real data is kept in something called the “Benefits Computer” and is accessed by Government Ministers and top civil servants but never made public for obvious reasons.

America does not go to quite these lengths but also understates the true figures by making it harder for redundant executives, managers and workers to claim unemployment benefits in the first place.

John Gelmini

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