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New Study Will Help You Benchmark Productivity

November 1, 1997
Related Topics: HR Services and Administration, Featured Article
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In today's business environment, traditional sources of competitive advantage-such as superior production capacity, excellent market research, quality manufacturing processes, careful inventory control and efficient product distribution systems-no longer offer the same advantage they once did. Today, these strategies for competitive advantage have become prerequisites to simply remaining competitive in a national and international marketplace.

Employers are learning they now must look instead to their employees for sustainable competitive advantage. The critical question becomes then, "How does an organization effectively tap into this valuable resource?"

A new, nationwide survey is under way to help your organization answer this question. The Productivity Benchmark Index (PBI)-a collaborative effort of the U.S. Chamber of Commerce, The Franklin Covey Co. and Vitality Alliance Inc.-is taking an in-depth look at the four cornerstones of productivity that determine long-term viability: Effort, Efficiency, Effectiveness and Capability. In addition to helping companies like yours uncover the hidden barriers that sap productivity and reduce competitive position, the PBI can point leaders in the right directions for making necessary improvements. While other productivity surveys exist, the unique contribution of this study is its focus on eliminating blockages to productivity while increasing the capability of the organization to sustain its productivity levels over the long haul without burning out employees and over-extending other resources. In a competitive marketplace, understanding how various parts of the organization help or hinder employees in sustaining productivity could mean the difference between success and failure.

The PBI was kicked off in September at a meeting of the leaders of national business associations hosted by the U.S. Chamber of Commerce in Washington, D.C. Workforce has been selected to track and report the progress of the survey as it establishes both national and industry-specific rankings or benchmarks. With these benchmarks, companies can gauge their progress against that of national and industry leaders year after year as they strive to become more competitive in their markets.

The study explores four cornerstones of productivity.
The PBI asks questions to discover if an organization's employees are fully engaged in their work both mentally and physically. The questions are structured around the four cornerstones of productivity:

  1. Effort: Do they work, and work hard?
  2. Effectiveness: Do the tasks that employees are assigned support a balanced plan for meeting the competing needs of the organization's customers, employees, owners, communities and other major stakeholders?
  3. Efficiency: Are employees finding ways to produce the greatest yield with the least amount of resources?
  4. Capability: Will the organization be able to keep up, or even improve, productivity levels as changes occur over time?

Of the areas being measured, effort may hold some of the most eye-opening information for company owners, managers and HR professionals. Studies have shown a vast gap between the minimum effort employees must give to maintain their jobs and the maximum energy, creativity and initiative they can give if fully engaged in the organization's mission and goals. As more and more jobs leave production lines and office cubicles to operate in less-structured environments, helping employers learn how to tap into the discretionary efforts employees choose to add or withhold may be one of the largest contributions of the PBI.

That's not to minimize the other three areas the PBI research is exploring. The survey will look into participating organizations' specific barriers to efficiency that stifle their efforts to control costs, minimize rework, increase accountability, and, in general, streamline the processes that allow them to competitively create and market their products and services. By pinpointing productivity barriers, managers can focus improvement strategies on specific needs.

In the third category, effectiveness, the PBI is looking at whether an organization is working smart-focusing its resources and strengths on its highest-leverage opportunities to bring significant and sustainable value to its stakeholders. Without this information, a company can be wasting employee goodwill and other expensive resources by efficiently working on the wrong things for creating lasting success.

The final category, capability, looks at an organization's ability to sustain or improve productivity. "Effectiveness and capability are where we see ourselves adding substantially to this project," says Greg Link, vice president of business development at the newly-merged Franklin Covey Co., an organizational training firm based in Salt Lake City, Utah. "Along with the developmental resources of the U.S. Chamber of Commerce and Vitality Alliance, we can help leaders look at whether or not their ladders are scaling the right walls."

The PBI partners foresee that the survey results will provide tremendous value to companies of all sizes. Participating companies will receive personalized information they need for working with their employees in creating mutually beneficial, long-term competitive advantage. These organizations also can compare their own productivity levels against top-performing organizations nationally, giving them specific goals to strive for if they want to become national leaders. And, when sufficient data are gathered, organizations will be able to compare themselves to others in the same industry.

Additionally, the survey data gathered will be synthesized into a national indicator of viability and vitality. Look to future issues of Workforce for reports on the national trends uncovered by the survey.

Workforce, November 1997, Vol. 76, No. 11, pp. 53-54.

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