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How do we increase productivity?

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How do we increase productivity?

Old 25th Nov 2017, 08:50
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How do we increase productivity?

I have been wondering about this for a while and thought this would be an ideal discussion point for JB.

I am now recently retired from the construction and energy sector. I felt that during the last 10 years of my career my productivity reduced due to the rising intervention of the 'compliance industry'. Some of it may have been required, but a great deal of it was designed to suck money out of the system and slow things down.

I am now mentoring other companies and I see the same thing, pointless paperwork and compliance which adds no value whatsoever and slows things down.

I know creating jobs is paramount in improving the economy, however, some jobs appear to be slowing our economy down.

Or is is I just don't understand, pull my socks up and work harder?
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Old 25th Nov 2017, 09:02
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I don't think you are going to beat this. It stems from two sources - one is the growing number of people who can't do a proper job but want to tell everybody else how to do theirs (H&S dorks), and the other is the need to CYA from the people who actually do the work, to avoid getting shafted by the compensation culture.

Doesn't help that most of the people I come into contact with (as a customer) are totally incapable of doing their job properly, certainly not as well as I could do it (and I'm not in their business) which makes it even more necessary for their (also incapable) management to adopt every means possible to CYA. You are best out of it.
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Old 25th Nov 2017, 09:41
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Grayfly, you know where I work - and I quite agree.

As 3D CAD technology advanced, the QS profession found it necessary to reinvent itself as cost consultancy with a sideline in concocting procedures. Unnecessarily convoluted procedures which we are required to follow. I recently flicked through one for adding a Business Continuity Plan to shared folder. You really need a multi page procedure for copying and pasting a PDF document? Whatever happened to KISS?

Kill all the lawyers? No, first sack most of the QS team (some are jolly nice and worth their salary!). Then scrap ISO9001.

Then there's "pre-qualification" businesses like Achilles who certify the fact that you are certified ISO9001, 14001, 18001, etc with BSI or BV or whoever. Different customers expect you to be registered with different PQ organisations, all at a cost and considerable time updating your details, insurance, etc, each year. Achilles? Oh the irony...
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Old 25th Nov 2017, 09:42
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Well, you could try the Australian model; import lots of of untrained, uneducated labour from 3rd world nations on "scare the bejeesus out of 'em" temporary visas so that they'll work unlimited hours, under 3rd world conditions for half of the statutory minimum wage while spending zero on training.
This model definitely increases corporate profits so it must be "productivity", right?
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Old 25th Nov 2017, 10:00
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Originally Posted by WingNut60 View Post
Well, you could try the Australian model; import lots of of untrained, uneducated labour from 3rd world nations on "scare the bejeesus out of 'em" temporary visas so that they'll work unlimited hours, under 3rd world conditions for half of the statutory minimum wage while spending zero on training.
This model definitely increases corporate profits so it must be "productivity", right?
I'm not even sure we'd get that right. That model certainly increases staff utilisation.

In the 1990's and early 2000's in my business sector, the amount of time staff spent on revenue generating work was between 80% and 100%. Training, holidays, sick days etc eating into that 20% non-value stuff.

When I left this sector last year, organisations I got the figures on showed staff utilisation down as low as 47% to 60%.

Not everyone in a business is a revenue generator, it just appears as though we have too many non-revenue generators. 'Passengers', as they used to say on the railways before they became 'customers'.
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Old 25th Nov 2017, 10:03
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We could sack more people more quickly.

There seems to be a tendency in the UK to hang onto staff as long as possible in a downturn, rather than sack people pre-emptively (so that their notice period is worked out just as the orders drop off). This is partly because firms believe that if there is an upturn soon it'll be cheaper to carry extra staff for a while than to re-hire and re-train, and partly because some bosses simply don't like throwing families on the dole if they think there's a chance of avoiding it

Either way, you end up with more people employed than you actually need, hence lower productivity than could be achieved by sacking more people sooner.
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Old 25th Nov 2017, 10:21
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Keeping people in employment when not really required could make business sense if you hope for an upturn soon. It also may reflect that we have become a more caring society under the radar.
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Old 25th Nov 2017, 10:35
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Why is productivity in Germany approx 25% higher than the UK? Are their workforce treated better or worse than ours? Do they train workers better?
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Old 25th Nov 2017, 10:36
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Sweat shops, we need more sweat shops.
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Old 25th Nov 2017, 10:45
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Keeping good professional staff who know the business during a lean period is essential.
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Old 25th Nov 2017, 11:50
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Doesn't it all depend on how you measure productivity ?

Is it the value of goods / sevices produced per employee or inhabitant ? In that case, you'd say Qatar or Brunei or even BVI are the most efficiently productive countries in the world - not Germany.

Is it a comparison of amount of labour costs required to ' make ' something ? In which case China or Vietnam or Bangladesh are probably the most efficiently productive countries in the world - not Germany.

If the measure is GDP per employee / inhabitant - then, OK, it's quite probably Germany as most things German are high quality but also high price. Same number of people needed to build a € 50k car or € 100k machine tool as a much cheaper one, but that metric suggests that Germany is more productive than, say, Japan.

So when we've decided how / what we include and measure when we compare countries' productivity, then we and the politicos can start to decide what improvements / deletions / additions are required for each individual country.

Or am I just proving that I know bugger all about economics ?
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Old 25th Nov 2017, 12:33
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Originally Posted by treadigraph View Post
Keeping good professional staff who know the business during a lean period is essential.
Totally agree, however, when things get really tough the people ringfenced to remain, no matter what, appear to be the senior management teams.

If there isn't enough work coming in surely I must question the revenue earning potential of my very expensive management team. I have been in situations in tough times where the management team decide to pay the vital workers first and take salary cuts accordingly. That is probably happening now in some businesses but is not sustainable.

The 'passengers' I referred to in my previous posts are more likely to sit in senior management positions and I must question why I need to have a head of the variety of new processes that have now turned into professions which don't generate me any revenue. Obviously, the ones which keep me out of prison are essential.

If I hire workers that don't know that falling from a height is dangerous to themselves and others, that enjoy being abusive or bully others etc then I am seriously hiring from the wrong end of the labour pool. Perhaps my hiring processes need to be improved and the money spent on senior position overheads reinvested in training and education of my workforce.
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Old 25th Nov 2017, 12:35
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Or am I just proving that I know bugger all about economics ?
Nope, you just proved that measuring productivity can be unproductive.

On that basis you could keep all your old staff and old ways of working and keep sacking those that measure productivity until you find ones that give you the results you want. Works the other way too if your organisation is already at peak performance and some corporate flunky wants to make their point.
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Old 25th Nov 2017, 13:34
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I'd say a large part of it is down to a lack of investment in training and technology.

For example - when I was a lad car washes were those automated gizmos that you drove through, operated by a single guy to take the money. Now they are pretty rare and it is now hand car washes where half a dozen East Europeans to clean your car. You still only get your car cleaned but now it takes 6 people instead of 1.
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Old 25th Nov 2017, 14:24
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I used to work in the voluntary sector by reading my utility meters and sending the readings to my energy company. They installed smart meters and made me redundant without any golden handshake. They didn't even provide me with any training to read my meters. I wonder if they are now more productive? I suspect not.

Luckily I still provide free recycling services to my local authority by sorting my rubbish on site. I then manhandle my bins to a pickup point outside my property. They haven't trained me to do this and didn't provide any manual handling training or protective equipment. The people collecting the rubbish appear to have received training and PPE. Each year despite my free contributions my local authority requests more money as they are not improving productivity. If they pay less for training and PPE they may break even each year.
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Old 25th Nov 2017, 14:50
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One place I worked 'downsized' by getting rid of engineering staff. It certainly saved money, except the good ones went to a competitor....followed to the same competitor by the good ones who had been kept and their managers. Very rapidly shut the whole place down permanently......
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Old 25th Nov 2017, 15:24
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I've read several articles which puts our declining productivity down to UK businesses investing less money in R and D than American and German businesses. I also also wonder if freedom of movement has anything to do with it as businesses have been able to employ low paid people by the bucket load for some sectors since 2004 rather than investing in innovation and new working practices.
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Old 25th Nov 2017, 17:05
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When I joined my last outfit in the 80s the 73s were kept airborne 18+ hrs a day. You never got into a cold seat or a cold aircraft. When I retired we were lucky if the aircraft were airborne for 12 hrs as the infrastructure could no longer cope, slots sceds etc. So yes how do we increase productivity today.
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Old 25th Nov 2017, 18:11
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There was a discussion on productivity on Radio 4 recently. I listened quite carefully and it turned out that economists were not able to actually define what exactly productivity means.
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Old 25th Nov 2017, 21:54
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I once visited a factory assembling air treatment units and was struck by the way that the workers seemed to have lots of time for idle chit-chat and socialising. As a member of the armed services I was mortally offended by their lackadaisical attitude! The idea that a worker was supported by his trade union when he brought a camp bed in for the night shift at one of British Leyland's establishments (in the 1960's) shows how the British do NOT have the work ethic. As a contractor at a nuclear power station I summoned a lift used to transport used protective clothing and as the doors opened I found one of the station staff sound asleep on a pile of the said clothing, he was most miffed when I prodded him awake! I just do not understand why the British are so against doing the job for which they are being paid. According to the Europeans I have worked with, the Brits are idle and workshy and I must agree.
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