Why is the UK lagging behind other major developed countries in productivity?

From the 1990s to 2007, everything was looking reasonable for the UK:

Since then, everything has been knocked sideways, moving from a very reliable curve to stasis at the drop of a hat (otherwise known as a global recession to be sure – but it was what happened next that is of most concern):

The UK was not the only country affected, however it is the only country still feeling the affects to the same degree:

In other words, having all suffered the effects of the recession hitting, some countries are now back on track and have made up lost ground while the UK is still in stasis. Of rich nations, only Japan is worse off.

Thus far, nothing is new and these statistics have been discussed previously in many forums across the nation and the web.

What if there is a new angle?

The reasons given for the productivity fall vary:

  • shifts of employment from high productivity to low productivity as employment has changed from full time to temporary work (thus keeping employment up, but with productivity slipping)
  • blaming a longer term culture in the UK in the form of not listening to the source of most solutions to productivity problems – namely to the individuals on the front line whose views, because of their often lowly position, are either unsought or dismissed
  • among others…

An interesting point arises when UK organisations, that are doing well in productivity terms, are analysed for the reasons behind their success.

  • The emphasis on everyone in the same boat needing to go the extra mile,
  • to having a clear view forwards so that everyone pulls the same way,
  • ideas of ensuring everyone’s hearts & minds are together.

It is clear that if productivity issues are clearest for the lower levels of an operation ie management/supervisors have more tools to be able to affect the productivity results while “workers” can only choose to work harder and longer.

BUT – does this mean that management knows where the weaknesses are and why productivity is lower than it ought to be?

If they are good managers, that may be the case.  Unfortunately, too often, management thinks they are good because they are in management. It is because of this attitude that they then don’t find out more from those on the front line.  Worse is to come, though! If management is bad at recognising their short-sightedness, see what happens when you add directors into the mix!

Directors have more power to change the equation than all of the management put together (by deciding to buy in more production for example).  BUT, this power does not come with automatic abilities to identify what needs to be done to improve productivity.

So the good companies have adopted a better communication system to allow front line input to be fed into their decision-making process – ideally in a way to encourage future feedback and supportively to demonstrate that good ideas are rewarded.

So now let us look at some other graphs to demonstrate another angle on this puzzle:

So is there a correlation between each country’s “ISO 9001 uptake” pattern and their subsequent productivity position relative to each other? Even if not, I think this points to some other indicators that might underlie what more is going on.

The charts show that Japan and the UK have clearly lost enthusiasm for ISO 9001 – while Germany and France are clearly still enamoured of it.  It also identifies another factor – that this state of affairs began BEFORE 2007 and therefore seems to represent an underlying state of mind that was prevalent prior to the recession commencing in 2007 (and which possibly exacerbated it).

Considering a selection of ISO 9001 requirements:

  • Communication
    • Internal audits feeding back into corporate planning
    • Staff communication and opinion feeding back into corporate planning
    • Customer comment feeding back into corporate planning
    • Strategy and company objectives feeding back into corporate planning
  • Continuous improvement
    • Sourcing concepts to improve
    • Enacting changes to initiate improvement
    • Following up to ensure improvements derived from the changes
    • Adapting process as necessary to evolve the next iteration
  • Hearts & Minds
    • Ensuring everyone in a company knows what to do, how and why
    • Training sessions to add depth to individual skills and understanding
    • Training to add scope to existing skills and broaden understanding
    • Focused on a single vision for the corporate future

When the changes inherent in the new 2015 version of the standard are incorporated, it is easy to see how these themes run on through; auditing of senior staff by junior, risk-focused action and so forth all point to ensuring all people are involved and that they work together on these projects.

These are exactly the way to identify problems, determine the issues of and develop out of productivity glitches.

Conclusion

So maybe what the UK Chancellor needed was to push ISO 9001:2015 as a key focus for all businesses?  It would take a few years to impact but would be cost effective – especially if focused on the SME end of the market as they will grow fastest over the next years and more will survive to do so with this sort of help.

It wouldn’t be hard – this has already been started: Government and Public Sector contracts often use ISO 9001 as a requirement or nice-to-have in their tender applications, there are moves afoot to match the EU and the US and have ISO 17025 a legal requirement for the forensics laboratories, the Environment Agency already reduces costs and demands to industrial sites with ISO 14001 when they apply for permits, the aviation and automotive industries have a vast preponderance of their suppliers with the AS9100 and TS 16949 standards…

Carl Kruger

Director

Qualitation

www.qualitation.co.uk

0845 600 6975