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The right stuff

Nick Howes, Managing Director at Leadership Management International UK, argues that developing the skills of existing workers could be the solution to closing the UK productivity gap

UK businesses continue to struggle to match, let alone exceed, the productivity levels achieved by our global competitors. Over the last decade, the UK’s labour productivity growth rate fell to a level lower than at any time during the 20th century, with little indication that the situation will improve any time soon.

With the UK now currently ranked behind many of its main European counterparts for productivity, including Germany, the Netherlands, France, Switzerland and Denmark, it’s crucial that businesses address the issue sooner rather than later – especially as Brexit uncertainty continues to build.

Productivity is measured by the amount of work produced per working hour, and is the main driver of long-term economic growth and higher living standards. According to data from the Office for National Statistics (ONS), the UK has achieved productivity growth of just two per cent in the last decade – a rate that was previously managed every year. Widely referred to as the UK’s ‘productivity puzzle’, the statistics support the idea that despite more people being employed, organisations still face an uphill battle when it comes to improving business output.

In theory, recruiting more workers or increasing working hours could help solve this long-standing problem. However, in practice it is having the opposite effect, as more people seem to be entering unproductive jobs. Businesses are beginning to take more extreme measures to improve the situation, whether by turning to new technology like artificial intelligence or spending more money on recruitment.

Of course, investing in state-of-the-art technology can be a positive move and a sign of growth as firms allocate significant resources to making processes more efficient. However, new research from the CBI suggests the UK could add £110 billion to the economy by improving people management practices within firms – using personal development to help workers realise their full potential. 

Rather than replace workers with technology, improvements can be made by providing more focused training, helping individuals learn the skills needed to complete high pay-off activities.

Not only will personal development enhance workplace productivity, but it will also reduce the need for businesses to recruit talent from elsewhere, saving significant time and money.

While some organisations attempt to solve the productivity puzzle by bringing in experienced leaders, others recognise the potential in their existing workforce, using bespoke development courses to help staff progress into more senior positions.

For many years, there has been a false perception that productivity can be improved by simply working longer hours. However, some of the most productive nations in the world have a shorter average working week than the UK. According to research, the UK averages 1,677 annual hours with £16.84 hourly productivity, ranking behind many of its European counterparts. Germany, for example, has 1,371 annual hours and £25.95 hourly productivity, while the Netherlands claim 1,425 annual hours with £28.35 hourly productivity.

I would argue that a better course is to discover the strengths of your existing team, using your workforce effectively to accomplish tasks. There are programmes available designed to teach people how to use their time and talent effectively. Refined and improved over time, these courses help individuals understand the true power of goal-setting and teaching communication, time management and delegation skills – all vital to operating within a highly productive team.

Other programmes focus on the strategic side of personal development, recognising the need for clear-thinking leaders who can create effective business strategies. Helping workers to become strategic leaders is crucial to long-term business growth, as they begin to optimise internal structures and enhance productivity using new skills.

While training your team and inspiring a new wave of leaders is a major part of the journey, businesses must also look for ways to continuously improve standards. In recent years, psychometric assessments have become increasingly popular, allowing organisations to uncover the personalities and motivations of new and existing workers. Typically used during the recruitment process, these assessments allow businesses to clearly judge potential candidates, gaining a better understanding of whether an individual will fit the culture of the organisation.

Rather than testing individuals with right or wrong questions, the assessments are used to uncover hidden traits, allowing organisations to find exactly what they’re looking for. They have become particularly popular within organisations suffering from high staff turnover, where decision-makers have relied heavily on gut instinct and hired the wrong candidate.

Psychometric assessments can also be used within existing teams to identify strengths and weaknesses, showing businesses how to enhance productivity by utilising the talent at their disposal.

The UK’s productivity puzzle has left organisations scratching their heads as they continue to search for ways to improve the situation. While expanding the existing workforce or investing in the latest technology may help soften the blow, these solutions tend to cost a significant amount of money and are not sustainable in the long term.

Instead, businesses must look closer to home, recognising the potential of their existing workers and giving them the support and training needed to become effective leaders. This will mean researching the development tools and opportunities available, as well as seeking advice and guidance from those experienced in drawing out the best from people.

About Sarah OBeirne

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