How productive are you at work? How productive are your team members?
During the last several years, employee productivity sky-rocketed as employer actions taken during the recession forced longer hours, more work and therefore, more productivity from the average employee.
But that can't last. At some point employers will have to start hiring again to keep pace with a rebounding (if slowly) economy. And that time is now, according to the latest US productivity numbers reported in MSNBC's "Economy Watch":
"The drop [in employee productivity] comes after a string of steady gains in productivity, as employers slashed their payrolls during the 2007 recession but squeezed more output from thinner staffs. Some of those gains came from investment in technology and other efficiencies. Some of it came from asking workers - fearful of losing their jobs with the unemployment rate at 8.2 percent -- to work harder and put in longer hours."
That said, what can employers do now to increase employee productivity? The article points to three ways:
1) Make Them Work Harder
The problem with this approach is you can't wring blood from a stone. As the report points out:
"But employers have apparently wrung about as much work as they could from their existing employees. To increase output, they've had to hire back some of the people they laid off during the recession.
This creates a new problem for organizations that may have hurt their employment brand during the recession. People out of work for many months may consider returning to the organization that laid them off, but those still employed now have options to move on to greener pastures where they and their efforts will be better appreciated.
Essentially, organizations may find themselves in a Catch 22 position of rehiring those deemed least worthy of keeping their jobs during the recession while the better (and now overworked) employees are moving on.
2) Pay Them More
Smart organizations will look to properly remunerate employees for the level of work they have taken on during the lean years. According to the report, however, these raises are few and far between.
"Even as they've been working their employees harder, companies have been slow to hand out raises. Hourly compensation was up just 1.5 percent in the first quarter. Overall labor costs rose 2 percent in the first quarter, down from a 2.7 percent rise in the fourth quarter."
This just digs employers deeper into a retention and recruiting hole at precisely the time they need to present their best face to the potential labor market.
3) Use Technology to Increase Productivity.
Knowing this challenge, many look to technology to help solve their productivity challenges. But all the value has been wrung from that stone as well:
"Some businesses may have also reached the limits of how much more efficiency they can wring from their workers with investments in new equipment and technology. Last week's report on gross domestic product showed a sharp slowdown in business investment in equipment and software, which rose just 1.7 percent in the first three months of this year, compared with a 7.5 percent gain in last year's fourth quarter."
That leaves employers needing to reconsider their approach to labor and productivity in today's rapidly evolving market. Perhaps the best option to apply is recognizing and rewarding employees appropriately for:
- The above and beyond tasks taken on during the lean years
- Their continued commitment to the success of the organization
- Their expanded knowledge and value to the organization
Simply telling employees their work is noticed, valued and appreciated can go a long way to solving the predicted productivity, retention and recruitment challenges on the horizon. Try it. What have you got to lose (besides your best, most knowledgable employees)?
As Globoforce’s Head of Strategic Consulting, Derek Irvine is an internationally minded management professional with over 20 years of experience helping global companies set a higher ambition for global strategic employee recognition, leading workshops, strategy meetings and industry sessions around the world. His articles on fostering and managing a culture of appreciation through strategic recognition have been published in Businessweek, Workspan and HR Management. Derek splits his time between Dublin and Boston. Follow Derek on Twitter at @DerekIrvine.
Great post Derek.
1) Make Them Work Harder
2) Pay Them More
3) Use Technology to Increase Productivity
Our current high productivity is kind of like the sprint at the end of a long race. You are tired, but know that the finish line is close.
These are all great, but I bet companies can get even better results by telling their employees that if can can just get to the finish line on the visible horizon we will provide some relief in the form of refreshments and fresh runners to help carry the load.
Posted by: Dan Walter | 05/08/2012 at 09:19 AM
Thanks for sharing Derek. Was looking at your discussion from the point of changing people's perceptions from "feeling stretched" to "feeling challenged and rewarded".
I'm working with Dittman Incentive Marketing (http://www.dittmanincentives.com), and they have seen an increase in incentive, recognition, and rewards programs over the past year in order to motivate employees to greater performance.
Companies are returning to group travel for winning sales teams, and enterprise-wide solutions allow employees to be rewarded for living brand values and achieving productivity and other goals.
What's nice is the perpetual cycle of achievement ties rewards to goals. In times of economic downturn, employees like to choose event tickets, dinner gift cards, and merchandise 'gifts' to supplement their everyday lives when salary increases are not keeping pace with cost of living increases.
Dittman uses enterprise-level SaaS (http://dittmantotalpro.com) to track behaviors and performance as a way of demonstrating success and return on investment. Companies know very well what a 10% increase in productivity means to the bottom line.
Hopefully, there is no finish line in business. Ideally, it's a self-perpetuating engine that supports employees, customers, and society. There's no doubt that the recession took a toll on morale and energy, but the truth is, it's a mindset. Dittman Incentive Marketing helps companies find meaningful ways to recognize, reward, and appreciate the hard work of people for a more positive mindset that has lasting value. Those campaigns are incremental "finish lines" strategically designed to drive performance, engagement, and participation.
Posted by: Wendy Flanagan | 05/08/2012 at 12:16 PM