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UK productivity is a controversial topic in the business world. Despite being one of the world’s most developed economies, UK businesses ‘trail’ behind G7 competitors in terms of productivity. Professionals from various disciplines have debated reasons for this problem, examining economic, political and social factors contributing to the inefficiency of the workforce. For example, some suggestions include instability of UK politics over recent years, insufficient government investment and repercussions of the pandemic.
On a smaller scale, we can use management strategies to aid the explanation of this issue. In particular, productivity in the workplace is arguably the result of successful management and implementation of efficient strategies. However, according to the Chartered Management Institute, fewer than one fifth of managers in the UK have received suitable training for their roles, thereby constraining the success of workforces. A significant cause of this problem is the occurrence of ‘accidental managers’- individuals who are promoted to managerial positions based on their success in other roles but lack the necessary qualifications and experience for management. Their previous successes often provide them with strong motivation and ambition; however, observations find overconfidence is common. Due to this, between 2020 and 2023, we saw many companies with strong intentions to improve productivity, yet 37% had made no progress towards understanding or improving their workforce limits. So, how can managers improve productivity of their teams? On a ‘basic’ level, productivity can improve by simplifying work tasks for employees, making work seem less overwhelming, and motivating employees to get more done. Managers should be transparent in their goals, whilst keeping them simple and clearly outlined.
Looking at some of the highest productivity levels in the world (measured as GDP per hour worked), we can turn to Sweden. A possible reasoning for this is their distinctive company cultures that revolve around fitness and well-being- an approach definitely less common in UK firms. Focus on well-being through exercise can be seen as a great approach to increasing workplace enjoyment, and therefore productivity. For example, Henrik Bunge, ‘Head Coach’ (CEO) of Björn Borg, is an extreme example of adopting a work culture that mirrors that of sports culture. To him, success at work goes hand-in-hand with exercise, and so he enforces a mandatory ‘sports hour’ for his employees every Friday. Interestingly, since he was brought in as CEO, operating profits of Björn Borg tripled. While causation cannot be established here, there is much evidence towards exercise increasing concentration, camaraderie and mental wellbeing, all of which is likely to increase productivity.
Another thought-provoking example is that of tech-giant Google, with its ‘20% time’ initiative. Employees are encouraged to spend 20% of their working week exploring work outside of their regular role or projects. The effects on productivity of this approach are profound; some of Google’s biggest triumphs, including Google Maps and Gmail, are a consequence of the autonomy employees are given through 20% time. It was reported that this strategy allowed employees to engage with their passions, which led to the tendency for them to be their most productive selves. However, a criticism of this approach is that Google has the resources to spare when implementing this time and small companies may not have such a large fraction of time to give to employees in their free time.
Overall, looking at these two examples, we can see characteristics common in both. Personal long-term benefits are clearly established as individuals regularly spend time to focus on their future ambitions and, at the same time, productivity increases. On the other hand, it may be argued that these positive company cultures are not increasing productivity of current employees, but are attracting more talented and dedicated employees to these corporations, which is ultimately the cause of the company’s improved productivity. Either way, the level of success and growth a company has is strongly correlated to the level of productivity a firm works at. If UK firms want to start being noticed amongst their competitors in terms of productivity levels, managers need to be aware of the significance of their leadership. The importance of reflection and assessment is clear and it would be particularly beneficial for managers to allow time to improve the performance of their teams.
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