01 Mar Navigating during turbulent times – How to increase business productivity in 2012
March 2012: With economic conditions likely to remain challenging in 2012, one of the key areas that South African employers will need to focus on if they are going to remain competitive is inspiring their employees to increase productivity levels.
This is according to Tjaart Minnaar, MD of OIM International, one of South Africa’s leading business consultancy firms, who explains that it is crucial that South African employers create an environment conducive to high levels of productivity in the workplace. “In poor economic climates, employers must understand that the destiny of the company, to a large extent, is in the hands of its employees. The only way to manage costs, quality, service levels and commitment, is with the buy in and determination from employees,” he says.
Adcorp figures late last year revealed that throughout 2011, labour productivity growth was negative (-1%), with an all-time low since 1970, reached in October. According to Minnaar these figures are highly concerning and point to a leadership issue. He urges employers to assess the state of their businesses now and to come up with a detailed improvement plan based on the principles of strong leadership.
Minnaar provides the following guidelines for strong and effective leadership in 2012:
Give clear direction and purpose
“In order for employees to identify areas where they could improve, they must have a clear understanding of the overall business direction and critical success factors, as well as exactly what is expected of them. Only then can they visualise their role in the organisation and how their daily output affects overall results,” says Minnaar.
Empower employees with the right tools and skills
Even if employees do know exactly what they should focus their energy on each day, they cannot deliver on this unless they have access to all the necessary resources and skills. “Often people are willing to do a good job, but are restricted due to ineffective processes, inferior equipment and a lack of appropriate skills,” says Minnaar.
He urges employers to avoid costly errors by investing in the necessary training should their staff lack certain skills. “Training can be an expensive exercise – but not nearly as costly as the ultimate cost of incompetence.”
Create stability and trust through credible leadership
A crucial requirement in challenging times is credible leadership. “Difficult economic realities will always create insecurity and dependable leadership will go a long way towards creating stability and trust among employees.
“It’s essential that employees observe that leaders are serious about living the values and driving the strategic goals within the realities of the external business environment. Set an example and be positive, yet realistic and communicate honestly and directly – both about positive and negative aspects.”
Engaged employees are committed to business success
Coupled with credible leadership, line managers must create an environment that inspires employees to actively participate in business performance.
According to Minnaar managers should create operational communication forums where they effectively and sufficiently engage employees so that they own their jobs and have a willingness and incentive to continuously improve on cost, quality and service.
In this way you ensure that everyone in the business is regularly engaged in effective team meeting structures that:
- Are focused on critical success factors
- Are action oriented
- Get everyone involved in regular performance review, goal setting and planning
Ensure that there is regular, accurate business & individual performance measurement and feedback
Employers must ensure that performance discussions are conducted as an integral part of the company’s daily operations. It cannot be run as a separate HR initiative,” Minnaar says.
“Managers should provide regular feedback on business, team and individual performance and hold people accountable. Give recognition and reward for good performance and decisively improve substandard performance with support and/or consequence management.”
Continuous improvement and optimisation
“It’s important to continuously evaluate business process and eliminate ineffective practises. Employees shouldn’t be inhibited to challenge processes and so-called holy cows.”
At the same time, you need to streamline cross-functional efficiencies to ensure cost-effective, quality client service and products.