Efficiency is not enough

Are you doing everything you can to make your organisation efficient? Do you run a very ‘tight’ and ‘lean’ company..

Good! 

But it’s not enough.

Efficiency is the baseline. It is where all organisations should start from. It is almost a ‘given’.

If your competitors are also striving for efficiency, they will be at the same base position.

So, on top of your efficiency, you need to add .... innovation, strategic direction, world-leading customer service ... those things that make a difference to the customer experience. These are often perceived as somewhat more difficult to achieve ... but a singular focus on the needs of the customer is all that is required.

One way to help this is to think not about what the customer wants but about what the customer wants to achieve,  So, if you are selling dog biscuits successfully, you might, on reflection, assess that what the customer really wants to achieve is a healthy, happy dog. The biscuits are simply a means to that end. 

You might then consider what other things you could do (and sell at a profit) to help create healthy, happy dogs.

Your expertise and experience with dog biscuits should be retained (and even enhanced) but you might look for complementary products and services ... or simply a marketing campaign for the biscuits that focuses on their role in creating healthy, happy dogs.

Your biscuit manufacturing should be efficient but the ‘wrapper’ of customer service and appropriate promotion is where additional, customer profits lie.  

What can you do over and above becoming efficient to unlock those additional profits?

Know what you want

I saw someone suggesting the other day that increased private  investment in (private) education would improve its productivity.

 think this is debatable.

As in many other areas, it depends on how you define and measure productivity. We all know that productivity is quite different than production or output: fundamentally it involves the incorporation of resources consumed ... mirroring the judgement we all face daily on assessing 'value' for goods and services we consume.

More investment would certainly raise the numbers of students coming out of private education .... but, as we have just said, that is not a measure of productivity..... nor, importantly, of that very elusive factor 'quality'.  

Take India as an example. Lots of private colleges and universities output thousands of students each year. Yet, there is some doubt about whether many of them are fit for the workplace. They know lots of stuff ... but they can't do very much. Their employability skills are lacking.

Even in admittedly strong areas like engineering, India's education is limited. Their engineering graduates are excellent at solving 'standard' engineering problems .., but when faced with a problem that requires ingenuity and innovation, they lack the problem-solving and creativity skills to take the next step.

So, let's define what we mean by 'productivity' in relation to education, let's determine our aims, objectives and aspirations ... and then try to assess whether more investment from the private sector can help us deliver.

It possibly can .... but if we don't know what we want to happen, we can't bring it about.

The same is true in your business. Unless you know exactly what you are trying to achieve, it is difficult to make it hsappen.

Too remote?

Remote or distance working (often referred to as ‘working from home’) has become increasingly popular over the last decade.

There is no doubt that fir many job roles, the technology exists to facilitate such working. Access to company data and services is no longer a problem.

What is still a problem, however, is that most workers are not ‘solo fliers’ ... their role is part of a wider set of roles that constitute a team - and, often, the performance and success of the team depends on more than the performance of the individuals within it.

Success depends on how the group of people function as a team, sharing responsibility, handing off tasks to one another, supporting one another when something goes wrong and acting on the basis of mutual trust. 

This can happen with remote workers but only if the relationships hsve been built by face-to-face working before remote working is introduced and preferably when at least some of the team maintains a physical presence and co-working. The team needs to maintain the ‘glue’ of shared values, culture and trust that make them a team.

So, introduce remote working by all means but you must manage it. Decide which roles can be carried out remotely without breaking team spirit, team responsibility ... and team productivity.

Well planned and well managed, it can work, and can save costs and help some employees with work-life balance, child care, etc.  But if you don’t plan and manage it well, it could destroy team cohesion .. and cost you more in the longer term.

No answers - just young thinking!

I talked recently to the Young Fabians (a UK-based left wing think tank) about "Britain's puzzlingly poor productivity".  In such situations, people often want to know the 'secrets' or the 'answers'. The YF were too smart to expect that. They understand that complex problems require hard thought, experimentation and multiple potential interventions.

Of course, experience helps. I have worked around the globe and have some understanding as to what works in particular situations - with a different geography, history, culture and so on. This shortens the list of options and reduces the time for experimentation.... but there is still no guarantee of success. Pulling the 'big levers' is often affected by the little cogs ... those little things that keep the whole machine running. Forgetting this is a big mistake.

In any situation, you have to understand who has the power, the influence and the commitment to making things work.

Generic principles apply - but may have to be overridden by local knowledge. That is why it is absolutely essential to 'go to gemba' and find out for yourself what is happening, what the current context is, who the key stakeholders are and what might or should influence the approach you take.

The members of the organisation (or the leaders of the country) are often too involved. They find it hard to step back and 'read' the current situation. Politicians, in particular, find it difficult to set aside their core political beliefs and act only on their core values. They 'know' what they want to work and are generally very surprised if and when it doesn't.

So, we need people like the Young Fabians to keep an open mind but stay true to their core values, to read the situation they are examining and to construct interventions, with advice from 'experts' that they are sure fit the particular context and situation. We might then grow a generation of genuinely radical thinkers.

What do you need to improve productivity?

Interesting question, is it not?  I guess you found it interesting or you wouldn't be reading this.

So what do you need?

Well fundamentally - just one thing.

A burning desire to identify and eliminate waste in all its forms - waste of resources, waste of effort, waste of talent, waste of time and so on. 

Once you've learnt to identify waste, it can become something of an obsession.  Seeing people wasting their time and effort makes you angry.  Seeing people who create processes that makes people waste their talent and effort makes you even angrier.

So, start to attune your radar.  If you don't know the 7 wastes of Lean, read up about them - and start to look for them throughout your organisation - and everywhere else. .  Calm your anger and think about how you would organise things differently to avoid the waste.  You have now worked out how to make your business more productive.

Life is ....

I used to ask myself the question...

What have you done today to improve the organisation?

Now I am older and wiser, I ask ...

 What have you done today to improve your life?

After all, work is part of life and we are understandably being asked to think about work-life balance.

Too many people don't think about their non-work life ... yet there is quite a bit of evidence to show that those who do - and have an active, balanced life - are more effective during work time,

Remember also, that life is what happens whilst you are waiting for something to happen. If you don't take control of your life, you are left at the mercy of ..... fate.

So, regularly ask yourself ...

What have I done today to improve my life?

What am I planning to improve my life?

You and your organisation will be better for it!

Good news or bad news

UK productivity has been bad for quite a long time and productivity growth is currently low.

What impact will BREXIT (the departure of the UK from the European Union) have?

Well, we don't know all the implications but here is one scenario.

The UK is currently a high employment, low wage economy with lots of people working part-time.  This means that for some time it has often been easier for firms to expand production by hiring new staff than by investing in capital equipment.

When the free movement of labour from EU countries ends, there may, in certain industries, be a shortage of the right people with the right skills.  This will create problems .... but in the medium term, it will make capital investment seem more attractive and more financially viable. So, in the longer term, we may see a gradual move to a higher wage but more capital-intensive economy ...  with an associated productivity rise.

Its an ill wind .....