Solving the puzzle...improving workforce productivity
Since the onset of the 2007-08 financial crisis, labour productivity in the UK has been exceptionally weak.
Figures from the Office of National Statistics (ONS) state that first estimates for 2014 suggest that output per hour in
the UK was 20 percentage points below the average for the rest of the major G7 advanced economies.
This is the widest productivity gap since comparable estimates began in 1991.
Consequently, there is a requirement for greater levels of productivity in both the public and private sector.
Public sector organisations are under increasing pressure to reduce costs which in many cases means a reduction in headcount
and the challenge of doing more with less.
For example, new rules are being introduced to control NHS spending on agency staff, police forces are required to reduce
overtime costs and within local authorities, austerity is a permanent condition.
Furthermore, within the private sector, organisations are increasingly moving to 24/7 working patterns to increase capacity
and the use of capital equipment and, in turn, boost productivity.
Productivity is simply the ratio of output to cost and is a fundamental measure of any economy and of business success.
Despite solid economic growth since the downturn, the UK has struggled to get more out of each hour worked, the problem has
become known as the ‘productivity puzzle’.
For the majority of organisations their largest controllable cost is their wage bill; Professor Cary Cooper commented that
“businesses talk about profit margins but not necessarily about how productive each worker is and how to make them more
productive” (Roper, 2015).
A recent report by Acas (2015) provides an overview of the part that the workplace plays in boosting productivity.
It describes seven ‘levers’ which will help organisations improve their productivity levels.
One of these levers is ‘well designed work: jobs and work organised in a way that increases efficiency and makes the most
of people’s skills’.
This includes giving employees the opportunity to have some control over the way in which jobs are carried out which may
include flexibility over hours worked and working patterns.
This white paper will consider traditional models of working and the types of peripheral labour that are often a dependency
within these models.
When models of work do not include built-in mechanisms to deal with fluctuations in the supply and demand for labour, it
can often lead to the excessive use of overtime, temporary labour and periods of non-productive time.
Traditional models of working:
Throughout the UK, working time arrangements are failing many organisations because they lack...
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