In 2021 Office of National Statistics estimated that the UK was in sixth place for productivity compared to other G7 countries, with output per worker being 10% less than the average, and output per head in the US being 1.5 times higher. Despite the need to improve productivity never being more important for business leaders, Be The Business’ productive business index in 2023 reveals there has been very little progress and points out that UK business leaders appear complacent about their abilities despite the findings that “against every question regarding activity to increase management capabilities… the UK ranks sixth out of seven”. This is not an isolated finding, with the World Management Survey also commenting “It is estimated that about a quarter of the UK’s productivity gap with the United States could be down to poor management”.
The question is why and what more can business leaders do to improve their productivity, with all the obvious benefits of being able to be more competitive or invest more in accelerated growth? Going deeper into the Be The Business report, it notes following specific performance gaps that compared to business leaders in other G7 countries:
- Management and leadership: Business leaders in the UK seem particularly unreceptive to regularly seeking advice and not investing in management capabilities such as decision-making, strategic planning, forecasting, mitigating risks, training and mentoring.
- Technology adoption: UK business leaders are behind on: adoption of e-commerce; developing digital capabilities; digital training for employees or managers; implementing new ideas; and access to funds for innovation.
- Innovation: UK business leaders are behind on plans to use external parties to drive innovation, time spent on developing new ideas from prototyping, introducing new internal processes.
- Training, development and HR: UK business leaders are behind on: initiatives to improve employee motivation; investment in new systems; initiatives to improve effectiveness of employee performance reviews, increase staff welfare, measure staff and business performance.
- Operational efficiency: With one rare stand out success of believing they are ahead on meeting customer expectations, UK business leaders are behind on introducing any new initiatives to measure and improve efficiency and productivity, and invest in data mining and analysis.
While most of our clients are actively addressing the above to support growth of value creation many businesses can make a significant improvement by taking two simple approaches:
- Work on the business rather than just in it. Even allowing just an hour and a half once a month has provided clients with a point to focus on the strategic development of the business.
- Implement affordable productivity initiatives. Many leaders appear to believe that the above are ‘big business’ practices that come with bureaucratic processes, high costs and big overheads. The reality is that successful businesses implement straightforward implementations that are cost effective and provide a quick return on investment (typically in the same year).
We work with scale up businesses to established businesses to help them accelerate business outcomes, drawing on our experience of working in and with high growth businesses. Our integrated approach combines operational expertise covering leadership, strategy, finance, people, legal and IT.
If you would like a confidential conversation to understand how we might help you, you can contact us on email@example.com for one of our specialists to get back to you.