Improving productivity is seldom about the drastic overhaul of procedures and process in a company where good, solid managerial processes already exist. It is more about management technique and iterative improvements in culture, procedure and process.

Improving productivity in a well-established organisation is complex and needs to be well considered. There is no silver bullet – the experience of productivity improvements involves a fair bit of disturbance, patience and above all, perseverance.

Productivity is about measuring the outputs of an organisation against its inputs. It typically constitutes quantity and/or value of products and services (outputs) measured against the costs incurred or time used through the production of such outputs. Inputs can include capital, materials, tools, and employees.

Productivity is measured by identifying the quantity and/ or value of the outputs and dividing by the costs of the inputs or measuring it against them. Productivity can be measured in financial terms or simply by quantity.

Broadly, there are two ways in which an organisation can benefit from increased productivity:

• Increased outputs for the same level of inputs – assuming there is enough of a market to absorb the extra output.
• The same level of outputs, but at lower costs – for example lower overheads by reducing staff numbers while maintaining the quantity of outputs.

Effectiveness and efficiency
The two key ingredients of productivity are effectiveness (doing the right things) and efficiency (doing things right). Often the focus is on one but not the other, but the two are tightly integrated and need to both be worked on continuously for true productivity gains.

Like migrating caribou, the herd needs to be heading in the right direction to be effective, and the whole herd needs to move together. Similarly, your business needs to have a clear direction, and the entire business needs to be aligned to that direction.

Efficiency is achieved through people, processes, and technology, and is a relentless process of looking at each of those factors and asking how they could be improved. It’s not just a top-down question – anyone and everyone in the organisation can be expected to contribute, and the business needs to be open to suggestions from them all.

How is this demonstrated for people, processes and technology?

• People – A key component to efficiency is people – the right people in the right places, well motivated, fully engaged, and well led.
• Processes – Business processes can be physical, mental or data, but essentially entail the same approach to make them more efficient. Typically the low-hanging fruit are found at bottlenecks and decision points – for example: do all payments need to be approved by the Purchasing Manager, or just all those over $10,000? The manager’s time can then be released to add more value, for example by optimising purchases.
• Technology – Very broadly, machinery, hardware and computer software are the primary types of business technology, with communications and integration being increasingly important technology types in their own right.

Building a clear understanding
The foundations for effectiveness and efficiency are tightly interwoven, and therefore understanding how People, Processes and Technology work in your business is essential to be able to identify opportunities for productivity gains.

Your organisation already has roles defined, either formally or informally. Your people in their assigned roles carry out your day-to-day business processes via a series of processes, activities, tasks and steps. This happens according to rigorous rules or in some modified form based on their personal capabilities and the tools they have at their disposal. They may be suited to those tasks, sometimes they’re not.

A thorough, accurate understanding of your current business practices is essential. This understanding needs to be based on actual processes followed on the “shop floor” and not solely on documented procedures. It is important to have an accurate picture of “already modified” processes.

Technology means shop-floor machinery, communications, information technology (both hardware and software), which may be well integrated or a loose collection of electronic and mechanical gear.

Getting software to serve you
Businesses don’t develop insights or make decisions.

Businesses don’t close deals, invent new products or find new efficiencies – people do. But they need the tools to help them be the best they can.

Based on an individual’s role there are three possible interfaces with software:

• Business application interface – Some people spend most of their day working within the Business Application software and have neither the need nor the interest in leaving it. They would like information from other systems and applications such as their personal productivity software to be dealt with directly in their Business Application Interface.
• Personal productivity interface – Some people spend all day in their personal productivity applications but occasionally need information from the Business Application software. They would prefer this to be available to them in the PP software directly so they don’t need to learn additional applications.
• Business portal interface – Some people only interface with applications for a specific process. For these people software needs to combine all the elements they need in a set of simple web-based screens or reports.

At the same time, there are three distinct worlds of software to improve productivity:

• Business process automation software which automates processes in areas like accounting, sales and production. This software has proven to be very good at automating specific tasks, but in some instances it can be inflexible and hard to change.
• Personal productivity software, the tools that we all use daily e.g. Word, Outlook, Excel and the Web.
• Platform software, i.e. the software platform that supports both the business process automation software and the personal productivity software. This software is typically out of sight and resides on big boxes called Servers. It consists of application and database server operating systems, email and database software as well as collaborative software tools.

The current goal of business software is to integrate the user friendliness and familiarity of personal productivity software with the user experience of business process automation applications, so they have the same look and feel. Further, integrating the two means that people can get up and running quickly with less training and support, and are inclined to do more with familiar tools.

Technology can bring together people, processes and technologies to help drive business success. Productivity and effectiveness can be increased by automating and streamlining financial, customer and supply chain processes.

In order to identify how a software application can best aid any particular role in an organisation, an understanding of what specific jobs and tasks people need to perform is needed.

The first stages – assessing the organisation’s people and processes – provide tremendous insight into how companywide productivity can be influenced and therefore improved.

This sets the stage for productivity gains from better, or betterused, software.

A business operates in a changing world. The complexity of the environment and processes are key influencing factors in what specific roles an individual holds and therefore the processes they will participate in. It also determines how intricate a process is and how the process breaks down into activities and tasks.

At the highest level, the combination of roles a user has translates into a personalised user interface or ‘home page’ which helps them access the tools they need for the processes they participate in. Within the navigation structure on the home page, a user can access a variety of ‘activity centres’ with all the tasks the user performs in a specific process. Finally the tasks for each process step are available in a Task Page.

Summary
In summary, productivity improvement is a relentless process of ensuring the business is both effective and efficient. Effective means ensuring that the whole business (people, strategy, processes, tools, data and activities) is dedicated to achieving the same goals, and that the whole business is moving in the same direction.

Efficiency means ensuring that people, processes and technology are regularly examined and improved wherever possible, to remain competitive.

In practice, the two are tightly interwoven and need to be addressed together. Careful planning, good management, and a relentless dedication to productivity are the key ingredients – there are few quick fixes.

For more information

This feature was abridged from a white paper prepared by Enabling, a professional services organisation recognised as a leader in the provision and support of business management applications throughout New Zealand and Australia.

www.enabling.net
Ph 0800 ENABLING

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