24 May 2017

Productivity Trumps Efficiency

Businesses focused on growth are constantly looking at ways to drive productivity and efficiency. Widely seen as two sides of the same coin, efficiency and productivity are actually very different. Synergy Strategist Liz Appleby explores the differences between the two and outlines the steps companies need to take in order to unleash workplace productivity.


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<p><a href=”https://vimeo.com/218489713″>Productivity vs Efficiency in the Workplace – Synergy 60 Seconds Ep2</a> from <a href=”https://vimeo.com/user15746292″>Synergy Creative</a> on <a href=”https://vimeo.com”>Vimeo</a>.</p>

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We were reading the recent research report from Management Consultancy Bain & Company in Harvard Business Review which outlines that businesses should be focusing on productivity over efficiency. Bain & Co spoke to 300 business execs and undertook 24 organisational audits to find the steps that companies need to make to increase productivity. They define the two as:

Efficiency = Doing the same with less

Companies look to improve efficiency by finding ways to reduce cost to the business and produce the same level of output. It’s about making savings by shrinking the ‘denominator’ like hours, employees, technology etc in an effort to improve profitability.

Productivity = Doing more with the same

Productivity is directly tied to company performance. More productivity means higher production of goods and services with the same amount of work. It’s about expanding the ‘numerator’, the output, in order to deliver greater top-line growth from the same workforce.

So what’s stifling productivity?

The two key outtakes from the research echo what we’re hearing here at Synergy from speaking to clients and their people:

  1. Systems and processes are holding employees back from doing their best work – meaning an average 20% loss in productive capacity
  2. Employees have the drive, desire and energy to be productive but lack the inspiration to do so

How can you inspire your people?

Of course, this depends on your existing company culture and employee base, but the best thing to do is speak to them. Find out what they want and need in order to be more productive. After all, the most productive companies boast a 30-50% higher operating margin than those who were less successful in this field.

Struggling to know where to start? Then talk to us! Our strategy team is adept at understanding organisation structures, teams and individuals to gather insight and turn it into action. Read more about how we’re helping the likes of Vodafone, Argos and ODEON Cinemas Group engage their people and transform their businesses here.

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