Productivity – A question of balance

Do you remember motorcycle display teams? In particular the military ones. I think they were called the white helmets, correct me if I am wrong? It seems that times moved on and they don’t seem as popular. Perhaps the insurance companies representatives kept having heart attacks when they priced up cover for their events!

Thinking back, they were impressive though. I always wondered how they got that precision just right, it looked impossible, it was magic wasn’t it? Well, probably more practice, trial and error. What it did demonstrate was a seamless balance when it came to perfecting their craft.

In many ways the idea of balance is the foundation of good productivity. The balance between the inputs to the production process and the outcome or outputs. When this ratio is out of kilter performance suffers and so does productivity.

According to the Office for National Statistics (ONS), The UK Government office responsible for the collection and publication of statistics related to the economy, productivity in its simple terms is.

A measure of how much output is generated per unit of input.

Perhaps a leap across the channel to the Paris based The Organisation for Economic Co-operation and Development) (OECD), the intergovernmental organisation, founded to stimulate economic progress and world trade can provide a slightly more comprehensive description.

Productivity is commonly defined as a ratio between the output volume and the volume of inputs. In other words, it measures how efficiently production inputs, such as labour and capital, are being used in an economy to produce a given level of output.

When I think of ratios and balance I am back to our ambidextrous friends on motorcycles. But what is the balance between inputs and outputs? In efficiency terms as the OECD suggests it is ‘how well’ are the inputs of labour, capital etc being managed to produce a given level of output?

How well indeed. What should happen to improve our use of resource to maximise productivity? A suggested and effective approach is to introduce automation. Or/and in conjunction a system like Enterprise Resource Planning (ERP), designed to provide greater visibility over how resources are used. These two interventions provide an important part of how we use capital to boost productivity, but what about labour? Automation of course can replace repetitive and low value activity, allowing for a redeployment to more value-added tasks. But how do we maximise productivity as labour remains an important input in every business?

Productivity can be increased in labour by focusing on capabilities in teams, or more specifically improving that capability. An improvement in skills, leads to better capability, which transforms performance through higher productivity.

These improvements can be seen in teams through

·?????? Better prioritising, agility and planning

·?????? More accuracy

·?????? Higher quality decisions

·?????? Improved communication

·?????? Accessing the unconventional to solve problems and optimise ways of work

All these lead to improving the work done, thus increasing productivity, and that improvement is supported by developing the skills of critical thinking, lateral thinking and problem solving. For example, critical thinking skills can be applied to improve the ability to prioritise. E.g. asking questions, evaluating and removing assumption to improve accuracy and focus on what is important as a business objective. The encouraging aspect thing is this can all be gained in conjunction with automation and systems mentioned earlier. In-fact in a recent study by Harvard University, production team members were trained in better communication and problem-solving skills. They increased productivity by 12%. (1)

We can therefore increase the level of productivity by strengthening the quality of the input and benefit from an increase in output. Improving the standard of the work done, by applying the skills directly in job roles, leading to higher output.

This all matters because 86% of Britain’s largest businesses are worried about their ability to raise their productivity levels, with 39% per cent describing their productivity as “very concerning.’’ (2) Why is this a problem? Well, according to The Midlands Engine, The UK Midlands region had a productivity gap of ￡82.3bn in 2019. (3) That is a considerable sum for UK PLC but also for your business.

At Sara Penrose Ltd we help companies to improve their productivity by training, applying and embedding the skills of critical thinking, lateral thinking and problem solving in the business. This is the improving of the input. We equip teams with the capability to use these skills to be more effective at their task in their roles. The more effective they are at prioritising, making decisions, checking data etc, the more output that can be produced. ?

If you would like to discuss how we can improve your productivity contact us

[email protected]

1.????? University of Michigan’s Ross School of Business, Shahi Exports/Harvard University 2017 - Soft skills training boosts productivity

2.????? Concentra Analytics, 2019

3.????? The MIDLANDS ENGINE State of the Region Executive Summary, Oct 2021

John Henderson – Co-founder and Director

Sara Penrose Ltd

Optimising performance through skill development

www.sarapenrose.co.uk

? Sara Penrose Ltd 2023