| | UK businesses achieved
improved productivity in
2005, ahead of Germany
and France, according to
a global report from
Proudfoot Consulting.
Workforce
productivity was up 6.4%
in 2005, according to
executives surveyed by
Proudfoot Consulting for
the firm’s annual
largest scale study of
productivity performance
at the company level.
This year's Proudfoot
Productivity Report
records a widespread,
global labour
productivity improvement
in 2005, and presents
both good and bad news
for the UK economy. On
the plus side,
unproductive labour time
in UK companies fell by
8.4% between 2003 and
2005. Last year, despite | |
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| | that will surprise many
is that there is no
evidence to support the
official view that the
USA enjoys a
productivity advantage
over Europe. The report
shows that companies in
both locations have
similar levels of
unproductive time
measured over three
years.
Inefficient use of
labour is believed to be
costing the UK economy
as a whole billions of
pounds. Using average
wages in manufacturing,
Proudfoot Consulting
conservatively estimates
the cost of poor labour
productivity to the UK
economy in 2005 at
around £70bn, or 6% of
GDP.
Simon Glynn, chief
operating officer of | |
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| | Proudfoot Consulting,
said: "It would be easy
to view the global
productivity increase as
cause for celebration in
company boardrooms
around the world. But
our report shows there
is clear and
considerable scope for
further productivity
improvement. It also
shows that executives
tend to overestimate
efficiency improvement
in their companies.
On average, 38
working days per
employee are lost each
year through operating
inefficiencies. However,
a considerable
percentage of executives
say they have no plan to
address this: almost a
quarter of those we
surveyed, a third in the
UK, have no current | |
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| | action plan. And those
in the UK that do set
targets are less
ambitious than those in
competitor economies.
"No company can
achieve 100% labour
efficiency all of the
time, but experience
shows that 85% is a
realistic upper
threshold,” says Glynn.
“To achieve this, a
business needs firm
chief executive support
and a mix of clear,
consistent strategy,
management ability, work
systems, technology use,
people supervision,
motivation and
commitment. The
challenge for the many
now is to mirror the few
that have so far managed
to achieve this level of
performance."
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| | longer working hours, UK
companies are shown to
have performed
significantly better
than those in France and
marginally better than
those in Germany, a
finding counter to
official productivity
statistics.
However, over the
three year period as a
whole, the picture is
reversed, with UK
companies recorded as
having more unproductive
labour time than those
in any other nation or
region studied except
Asia. Another finding | |
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