There seems to be an obsession with tracking productivity in organisations. Leaders sometimes focus too hard on maximising productivity to the extent where focus is lost on what the actual goal is. Statistics show this can be detrimental to an organisation’s culture and that these practices achieve the opposite of what they are meant to.
- 90% of people daydream in meetings.
- 50% of people find meetings unproductive.
Further to this, constantly tracking an employee can reduce them to mere numbers, devaluing their worth as a human as they are only seen in terms of their objective contributions. This can drive down morale which in turn means lost productivity. The pressure to hit targets and high productivity levels causes stress and has a negative effect on an employee’s well-being. This will cause them to leave resulting in new people to be hired who then have to be trained, wasting resources and time.
- 22 million active disengaged employees.
- This costs as much as $350 billion per year.
It would be absurd to suggest not tracking your employees at all, of course it is necessary to maintaining high standards. However, it must be balanced with a human approach. Tracking too much and you will drive down morale, too little and you sacrifice revenue. Tracking employees is fine as long as leaders are empathetic and are looking out for their workers’ needs. Create a culture which benefits the workers so that they are happy and productive but also willing to work hard.
Generally, the most productive countries of the world actually work less than the least productive (collectivehub.com, Melanie Dimmitt). Norway is more than twice as productive as the UK while they boast just a 27 hour working week, with the UK averaging 37.4 (ons.gov.uk). However, relying solely on these statistics would be folly as there are external factors such as cultural differences. It is up to you to recreate that culture in your own company by being more empathetic. Further to this, South Korea has reduced its working week from 68 hours to 52 in a bid to increase productivity (bbc.com, Fernando Duarte). It has longer working hours than the rest of all the developed countries whilst not even being in the top 20 most productive countries (expertmarket.co.uk, Jennifer Pinches).
On the other hand, the USA works an average of 47 hours a week, yet are the 6th most productive country in the world. Therefore, we can see that it is not so black and white. Reducing working hours will not necessarily increase productivity. You need to understand your people, the environment that surrounds them, and then make adjustments that are relevant to your company. This is all possible through being more empathetic.
What about AI?
There is a constant tension around improving productivity, and with this we must consider AI. The easier it is to measure work, then the easier it is for technology to take over and automate that same process. Companies and leaders that focus on tracking productivity are missing the bigger picture. There is a common misconception that AI will destroy jobs. This is not the case.
- By 2020 AI will create a net gain of 500,000 new jobs.
Technology’s impact on the workplace augments human traits and it is up to companies to create human centred cultures. The most successful and productive companies will be the ones who are creating a human culture for tomorrow. AI will help create new skill sets which require valuable human traits such as empathy, insight, creativity and leadership. Having a workforce who can harness these traits is vital to being productive in the future and maximising the potential of technology. Productivity and culture go hand in hand, so fostering that positive company culture is vital to going forward.
The productivity and culture relationship
Having a culture that promotes collaboration and empathy is a recurring theme of recent fast-growing, highly profitable companies. Creating this environment starts with recruitment. Zappos, a shoe retailer, embodies this idea within the core values of the company. Training involves intense focus on customer service and company philosophy where everyone is offered $2000 to quit now. This unusual, innovative idea works perfectly in creating a collaborative environment. Employees are enthusiastic to work there, therefore creating positive team culture.
- Within 9 years of its birth, Zappos hit its goal of $1bn in gross sales.
- Within the same time period, hit 23rd on Fortune Magazine’s best companies to work for.
This culture can also be fostered by empathising with employees and giving them more control. A 4 day week was trialled by Perpetual Guardian in New Zealand with great success.
- Despite staff spending 20% less time in the office, productivity did not drop.
- Job stress declined from 45% to 38%.
With this example, we should note it is not just about giving Fridays off. Different employees have different needs and so you need to creatively design how this is going to work. Some people do not want a whole day off as they will get bored at home. They would rather finish earlier everyday so they can spend time with their kids. On the other hand, some may like to arrive later so they can drop their kids off at school.
CEO Andrew Barnes says “When a new mother negotiates a shorter work week, in most jobs now, she gets paid 20% less. Why? This is about productivity. Negotiate on productivity–hours are irrelevant.”
What Barnes says here is so important. Leaders get far too concerned about numbers and need to treat their workforce as humans, not robots. Giving more autonomy to staff as to how they plan their week will make them happier, less stressed and therefore more productive. This is not about stopping the tracking of productivity. It’s about future-proofing your workforce by marrying productivity and culture together to ensure your workforce has the ability to move into tomorrow. Give them the tools so that they can choose how they work while remaining clear on the output expected.
The future is AI, but it is not the ultimate solution to the productivity problem. It is paving the way for a shift in the labour force to become better skilled and more collaborative. However, this is only possible with leaders that are empathetic and understand the relationship between productivity and culture. Adopting a positive company culture which is more collaborative is core to maintaining high productivity and being successful in the future.