At the macro level New Zealand’s private sector productivity has not, according to new Statistics New Zealand study, been the laggard it’s been labelled over the past 17 years. Nevertheless, at the day-to-day management and leadership level, the New Zealand Institute of Management has been thinking about some very practical approaches to delivering better workplace productivity.
The New Zealand Institute of Management has been thinking about productivity. To be more accurate, some of NZIM’s best management thinkers have been thinking about it. And they have come to some useful conclusions.
Even if newly released Statistics New Zealand figures show steady 2.6 percent year lift in the country’s labour productivity between 1988 and 2005, individual enterprises that don’t keep focused on making productivity gains priority will find the going tough.
As recent issue of The Economist points out; businesses everywhere need to organise for high productivity if they are to compete and succeed in an era of global competition, ceaseless innovation and fewer barriers to the spread of information and ideas.
The NZIM “fellows forum” focused on developing key productivity concepts and processes to help the Institute contribute tangible recommendations to productivity discussions with government departments, other business organisations and research institutions, particularly at the micro and enterprise level.
Productivity drivers
The panel endorsed the relevance of seven productivity drivers identified in working group report issued by the Department of Labour in December 2004. The drivers are:
• Building leadership and management skills
• Creating productive workplace cultures
• Encouraging innovation and the use of technology
• Investing in people and skills
• Organising workplaces better
• Networking and collaboration
• Measuring what matters.
But, says report from the NZIM panel, productivity improvement is about more than simply producing greater volume of existing goods and services with given input of labour and capital. It is not sufficient to boost existing production if it can’t be sold profitably. Production patterns need to consider competitive pressures and changing demand and supply conditions.
What matters is increasing the returns to suppliers by producing more of what customers are prepared to pay for. The aim of increasing productivity and reducing costs is to improve shareholder profits and deliver more employee and customer satisfaction.
The panel thinks NZIM could identify employers, enterprises or organisations that have successfully improved their productivity and create case studies to highlight how their productivity gains were achieved. This information could then be shared with other enterprises.
Skill shortages
The shortages of skilled managers and staff are, and seem likely to remain, serious impediments to productivity improvement, says the panel. They recommend businesses recruit, train and make better use of mature workers and immigrants who possess or could acquire suitable skills. And there are people, married women who have been raising families for example, who are prepared to return to work after break if their skills are properly recognised in the workplace.
The panel suggests NZIM and interested parties in business and government seek the assistance of the Institute for Research into Ageing and researchers to survey the attitudes and practices of employers in relation to mature workers and the attitudes of mature workers to remaining or becoming employed.
“The results of such surveys could provide useful basis for improvement of government and business policy affecting the employment of such workers,” says the report.
Officials need to review and discuss how effectively New Zealand enterprise utilises the talents and experience of migrants, what improvements might be made to job placement programmes, mentoring, training and English-language courses, so that migrants can make an increased contribution to improving productivity.
Untapped resource
Developments in information and communication technology have, according to the panel, made people resourcing even more important as productivity improvement factor than it has been in the past. And more attention should be paid to improving the effectiveness with which the new technology is being utilised by New Zealand businesses. Currently staff are only trained to use fraction of the electronic capacity available and that is not very productive.
Accordingly, NZIM and other training providers should pay special attention to how management and workers can improve the selective use of the increasing information available through the internet and other media, to help improve workplace productivity.
Using the knowledge and experience of the workforce and the contribution which can be made by part-time and contingency workers is an important consideration.
Leadership
The panel stresses the importance of good leadership and the need for every enterprise to aim at developing culture of improvement and innovation. “Such culture should produce an operating environment of delegation, accountability and continuing education, in which people feel valued, are encouraged to communicate effectively and honestly about goals, plans and programmes for improvement; and are rewarded for their contributions to both individual and team improvement,” said the panel.
Special thanks to the members of the NZIM fellows forum: Prof Frank Holmes (economist), David Chapman (NZIM national CEO), Bernie Harris (management consultant); Boyd Klap (company director), David Moloney (company director), Brian Murray (business consultant) and Gordon Rabey (management writer).
