We hear so much about improving our productivity and managing our time better, but do you, as a Business Owner or Manager really understand what productivity is?
In the “olden days” back in the 20th Century, productivity was still a true measure of the value we reaped from our financial investments into the company. Payroll and Salary are normally the greatest cost to the business and yet as a nation we fail miserably to monitor the value our employees are PRODUCING for our money.
Employees can only be productive if they know where the team is heading. Lack of vision and unclear company goals result in wasted effort, disorganisation, and inefficiency in the workplace.
How often do you hear a manager saying their staff know what they’re doing and can be left to just get on with it? How often do you hear a supervisor telling staff to “pull your socks up”, only for them to be left wondering how far up they should be pulled? A poor explanation of exactly what is required from employees renders your business highly unproductive from the outset.
Stumped.
During one of my Productivity Improvement Programmes, consulting to one of the Forestry companies in the south of Chile, one of my Team Leaders came back from the field, with his eyebrows raised. He was so frustrated, but couldn’t understand why something so simple hadn’t been confronted before.
When lumberjacks are using chainsaws to cut down trees, it would be common sense to cut the tree down as close to the ground as possible, to get the highest yield of timber possible. However, chain saws get heavy, the days are long, and the lumberjacks want to get through the work using the law of minimum effort.
The consultant started to notice that, on average, the tree stumps were about 1m high (waist height?). He quite rightly pointed out that for the average 20 metres tall pine tree, that’s 5% of the product being left in the ground.
Now, that might sound trivial but when you’re felling millions of pine trees a year that 5% is actually worth a timber-shed load of money. As a result a standard was put in place training the lumberjacks to leave no more than 25-50 centimetres of stump, which together with closer monitoring by the supervisors in the forests, the company achieved a significant increase in yield (productivity), and extra profit to the tune of millions of dollars a year.
Other scary examples of unproductive work methods I’ve witnessed in my travels are the Financial Accountant who sat using a calculator to add up a column of numbers in an Excel Spreadsheet (because he didn’t trust the computer!!!!), or the junior Admin Assistant who sat and pulled out staples from a high stack of papers, realigned all the corners to make the stack neater, and then stapled the documents back together again! Did his Manager really have a clue HOW (or in this case WHAT) his staff were doing?
These may sound extreme, but the overriding principal is the opportunity to improve is hidden in so many ways amongst the dark corners of a business. Performance management requires the owner or manager to have a good understanding of HOW the work is being carried out, and work with their teams to critically analyse and challenge the norm – continually assessing other, potentially more productive, methods to achieve your objectives.
My advice to every business owner and manager is to get involved in the detail now and again. Make sure you’re comfortable with what is going on in the day to day nitty gritty – or not as the case may well be!
If you feel you could benefit from external support during your early years of trading, or need expert advice developing your first management systems, processes and teams, Alluxi Consulting Ltd offers Business Consulting and Executive Development programmes. An initial no obligation exploratory discussion can quickly uncover what you need to move your business forward.
Linda Garcia is Managing Director of Alluxi Consulting, Business Performance Consultants