Last week, the Labor Department reported that productivity slowed over the summer months. While the overall indicator did increase (1.3%), the increase was smaller than Q2 (3.6%).
So what does this mean? Productivity is an important measurement – the more productive employees are, the more companies can provide in terms of wages (because the company’s sales will cover the payroll expense.) Simply put, the more employees produce, the more the company can sell, then the more a company can pay. As Homer Simpson would say, “D’oh!”
Anywho, we’ve got ourselves in a vicious cycle right now. Times are tough and companies are laying people off. So what are employees doing as a result? Could it be they’re hanging around the water cooler wondering if they’ve got a job next week or surfing the net to see who they can connect with on LinkedIn?
And, what does that do to employee productivity? Well if people aren’t giving work 100% of their attention then, of course, productivity will be down. That translates into companies producing less…which means they are selling less…which means they don’t have the money to make payroll. Bingo…you see where this is going.
As a result, it’s time we dust off that old cliché “doing more with less”. Now I know, some folks might say you can’t do more with less. But, the sad truth is we aren’t operating at 100%. Five employees operating at 100% can do more than six operating at 80% . . just do the math. Simply put, that’s doing more with less.
And since we’re all tightening our budget belts…then the statistical probability exists that, whatever we do, it will be with fewer resources. We just need to get creative.
It’s time for all of us to get 100% in the game of doing more with less. We’re asking our government to take action to improve the economy. We want businesses to do their share. Everyone needs to contribute. As employees, our contribution is productivity.
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Kaya Singer says
Great article and good points. But I did notice that the phrase “doing with less,” makes me feel constricted. I already live a lifestyle that does not include shopping as a past time. I don’t buy new furniture, appliances, or big screen TV’s. However I do attempt to keep an abundant state of mind. I never feel like I am doing with less. I feel that I am focusing on making quality choices. Doing with less, in terms of running my own business, can be a poor choice and will certainly trickle down to my sales. It reminds me of a short story I read about an older man selling hot dogs in NYC around the time of the depression. He had a good business and would run out every day. He decided to buy more hot dogs and get a cooker that could handle more. His son, who just graduated from college, told him that was a mistake because there was a depression. He figured his smart son was right so instead he cut back and had less. His customers came and by mid-day he ran out. They were disappointed and went elsewhere for lunch. Finally he had no customers and he had to close shop and sell his equipment. He told his son, “you were right son, there is a depression!”
George Black says
Management attitude greatly affects how productive employees care to be. Being stimulated by an exciting and shared objective is very different from “…beatings will continue until morale improves.” New, more entrepreneurial businesses, with deeply engaged, skilled employees—many with an ownership stake in the enterprise—have reputedly very high productivity. I suppose they must have…or die.
I don’t know the answer for more established traditional businesses as to how they can create or encourage such engagement but it seems to me that fear of job loss alone won’t do it. Proactive steps must be taken. Massive layoffs encourage a wave of fear and resentment among those left with the mandate of producing the same amount of work as before–or be the next to go. My sense is some will be happy to go…or if they can’t afford it…may surreptitiously subvert the project.
Could social networking work to release the pressure felt by layoff survivors? Or be used by management to inform and initiate two-way interaction to encourage buy-in to the mission by employees? So much traditional corporate communication is slow, formal and clunky by contemporary social networking standards.
What is the current thinking of social networking-conscious HR folks, Sharlyn?
Dustin Henderson says
Why all the doom and Gloom – this is the beginning not the end!
It is in this environment the real innovators will emerge. I heard this quote once and I really liked it – “Innovation requires constraint.” We are emerging from a time of very little constraint. All bets were winners. No one had to think creatively.
Now, times are hard. There are very few answers. Good people are loosing their jobs and their homes (and that is bad!). Budgets are shrinking. We have to do more with much less. In other words, we are in a time of significant constraint.
Increased constraint means a decreased in the idea pool. The posers have left the building. It is now up to the believers, the real innovators, to step up enjoy their place in the sun.
eitan says
Thanks for the nice post and for bringing this important subject up as it tends to be pushed aside in the current climate. I second George’s point: engagement plays a key role now, as it is when economy booms. I read some people suggesting to postpone, defer or “soften” retention initiatives now. While I think the strategy should be adjusted, it cannot be put in a time capsule box that will be opened in a year or two.
Engagement = Productivity. And productivity is very important now.
hr bartender says
Those of us who are tuned in to social media know its power for internal engagement and external marketing. Stay tuned and you’ll see more about this in my prognostications for 2009. And yes, hard work without good decision-making is always a recipe for failure. There is never a substitute for strategic planning. Let’s hope Dustin is right . . that the posers have indeed left the building, leaving it up to us socially networked inmates to take over the asylum. Cheers!
Chris - Manager's Sandbox says
Even when benefits get slashed, staffing gets cut and work-loads increase, it’s still possible to keep productivity up and people motivated. Someone else through out engagement, and culture obviously plays a huge part in the engagement of employees.
This is a great time to examine how effective your reward and recognition programs are, too. Are they based solely on money and promotions (instrumental motivation). If so, people are missing out three or four other great ways to inspire and motivate people.
Instrumental Motivation: Putting people in jobs they love. They’ll do they work even if they’re terrible at it (which doesn’t help you, of course – but if you can align what they’re good at with what they like… jackpot!)
Internal Validation: Provide people with challenging but realistic work. People motivated by internal validation enjoy the internal thrill of completing a challenging or difficult task. If the work isn’t realistically achievable, you’ll just demotivate. If its too easy, they’ll lose interest.
External Validation: Money and success are great, but are you publicly announcing people’s successes. Make a big show of it, put their name up somewhere, give them a certificate. Allow people to bask in the glory of a job well-done.
Goal Identification: One of the hardest to achieve, people who are motivated by goal identification do things they hate just to see their company succeed. You see this more at non-profits and companies that make or do cool stuff.
Sharlyn, I hope you don’t mind a shameless plug, and if this is inappropriate, please feel free to delete this part. I’ve written at length about motivating employees on my blog, and offer a free podcast and ebook. You can check it out here: http://managerssandbox.com/archives/motivating-your-employees/
Cheers!
Chris