HR’s role in solving the UK productivity puzzle

productivity-puzzle

Economists and politicians have expressed concern at the UK’s productivity lag. Unlocking a culture of collaboration could be the key to working more effectively, argues Jean Martin.

The UK productivity crisis has been highlighted at the highest levels. Several high-profile figures, from Chancellor George Osborne, to Bank of England governor Mark Carney, have expressed their concern about its role in sustaining economic growth, job creation and improving living standards.

What is puzzling about this slowdown in productivity is that while both employment and working hours are up, labour productivity – output per hour worked – has fallen and is behind many other industrialised economies.

Economists and politicians alike have been wrangling over the issue, looking to population shifts and the impact of technology as possible reasons.

But research from the CEB shows that the key to unlocking higher productivity may be much simpler than expected; that better collaboration across the workforce delivers greater results at both an individual and organisational level.

Jigsaw pieces

The productivity puzzle, just like the workforce, is comprised of individual jigsaw pieces that interlock to make up the bigger picture.

Within an organisation, the pieces combine to form a collective “one company” mindset that enables employees to collaborate across business divisions and units, so their work benefits the company as a whole rather than just individual performance.

Today’s workplace is more interdependent than ever before, which means individual success is dependent on the way employees work with and through their peers.

Our research shows that employees who work collaboratively can significantly increase company productivity – with the average annual revenue per employee rising by £10,500. Profit growth is also boosted by up to 11% for every employee who excels at working collaboratively.

Findings also show that employees are naturally willing to collaborate, with eight in 10 reporting that they want to work more effectively with colleagues. Yet companies seem to be actively blocking people’s efforts; 75% of employees believe their organisational environment actually impedes their ability to work with others effectively.

Today’s practices and culture are forcing employees to make difficult trade-offs every day; colleagues are asked to help each other, but they also compete for pay increases and promotions.

Employees lack the information they need to efficiently seek support from peers to progress their projects and goals.

Against the grain

HR systems and people management processes need to be upgraded to better support the needs of the business. Performance reviews and key performance indicators should no longer be based just on completing individual tasks but on organisation and team goals.

This works against collaboration because people feel they would never be recognised or rewarded for contributing to a bigger group project or helping out peers. Employees must be empowered to shine through collective effort and be recognised for their network contribution in the workplace.

The research shows that those who lead through collaboration have teams that are 35% more engaged, 68% more innovative and achieve 20% higher customer satisfaction scores than those teams with more individually-focused leaders.

To help solve the productivity puzzle, HR leaders can support collaboration by addressing these four key areas:

Reframe competition: evaluate employees against collaboration and “competitive” cooperation targets by formalising these as performance indicators and reviewing them frequently.

Incite cohesion: provide employees with the context, transparency and connections to help them prioritise work efficiently.

Empower collaboration: prepare employees to expect collaboration challenges and equip them to work together to address those challenges.

Leverage motivational drivers: use non-financial rewards to accelerate and improve collaboration. Current financial incentives often diminish employees’ motivation to help one another.

It is rare that individual employee behaviour can occur with such frequency as to explain a nation’s economic lag.

However, in an economy where increases in productivity will be born of creative, highly motivated, agile people, able to achieve the highest levels of customer satisfaction, these findings suggest that this may be one case where the UK’s productivity boost is sitting not in the banks and the boardroom, but at every desk.

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