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Winning the Productivity Game: An Innovative Approach for 2009 and Beyond
In the 1960s, manufacturing dominated the world's economy and the systems for improving the productivity of machines required investment in state-of-the-art processing technologies. Now, fast forward to 2009 when the engine of the economy relies on service intensive human capital. What must U.S. companies do now to drive productivity and revenue growth? How has the future of productivity changed?
“Think Microsoft, Thomson Reuters or even Orkin, each of these companies is essentially a collection of leased buildings and people,” explains Brad Hall PhD, Business Innovation columnist for TheStreet.com and author of The New Human Capital Strategy. “With 75% of GDP from advanced countries now coming from services, it’s time for a fresh approach to productivity improvement, one that is focuses on workforce capabilities.”
What are your company's productivity-enhancing strategies?
“More likely than not, over the past 12 months your workplace practice of choice has been downsizing,” notes Productivity Specialist, Brad Hall PhD, Founder of www.humancapitalsystems.com. “Downsizing can improve output per hour, but it doesn’t affect growth. Mass layoffs will likely reduce mid- and long-term productivity by suffocating risk and innovation. It's time to build a new model that builds efficient workforce productivity”
Create Effective Executive Teams to Assess Performance
“Executive team performance may be your organization's biggest productivity lever,” explains Brad Hall PhD, Business Innovation Columnist for TheStreet.com. “Ask team members to define the four or five outputs for meeting the organization's financial targets. Have team members define level 1, 2, and 3 performance for each. Finally, as a team, assess performance every six months.”
Key Position Excellence
“When people in our most important positions outperform their competitor peers, we win. Let's be honest, not all roles are equally important to the bottom line,” says Hall. “At Kraft, brand managers are critical; at Coldwell Banker, it's the real estate office manager. Choose two or three roles with the biggest impact on customer and shareholder satisfaction and build a complete system that ensures year-over-year performance improvements.”
Here's how:
- Clarify success measures for the role (i.e., lagging indicators of performance). This unambiguously answers the question, "How am I doing?"
- Define the four to five most important activities for each role. Get rid of your over-engineered competency models. Determine the four or five things your top 5% do each week and find out how they do it. For sales managers these might include maintaining a full pipeline, improving executive positioning and upgrading sales capabilities. For real estate managers it includes agent recruiting and community relationships.
- Assess incumbents and move low performers. Assess incumbents on each success measure and on each activity. Transfer or terminate individuals who will not be considered A or B players on the open market.
- Design HR systems to improve performance on the key activities. Align all HR systems to the five activities (e.g., selection, training, appraisal, career paths, base pay). For example, use top 5% practices to create training content for the major activities. Eliminate all training that does not drive performance improvements on the major activities. Want a mini-MBA? Pay for it yourself.
- Define your company's culture in business terms and behaviors. When IBM reset its culture, it held a 72- hour "values jam" (like a jazz jam session where everyone gets to play). IBM employees set a very clear set of business focused values: Dedication to every client's success; innovation that matters for our company and for the world; and trust and personal responsibility in all relationships. Once the values are clear, assign a leader from the executive team to lead and report progress every quarter. IBM did this by assigning culture to the Senior Leadership Team, a working group of the "best" 300 leaders at the company.
Productivity is more complicated today than it was in the 1960’s, in today's service-rich economy a new productivity system is needed, one that focuses on human capital.
“Sustained competitive advantage requires outperforming competitors, and that’s the bottom line,” says Brad Hall PhD. “That performance is defined on a set of corporate core competencies, activities that customers and shareholders value most. Beating competitors through core competencies requires that employees in roles most critical to executing core competencies outperform competitor peers. The output of a Human Capital Strategy is a workforce that is more productive and most profitable.”
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Business Branding Strategist & Media Expert, Annie Jennings, CEO of the National PR firm, Annie Jennings PR (www.anniejenningspr.com) advises businesses, CEO’s and their Management Team, Authors & Experts on how to build stronger businesses and position themselves as thought leaders in their fields. Annie Jennings PR books clients on the most prestigious media outlets in America. Her commitment to excellence has forever changed publicity as she has created the most advanced publicity tools and strategies used in PR today. Annie’s mission is to help everyone share their messages all over the world.
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