The Productivity Crisis

20-07-2017

Earlier this month the Office for National Statistics announced that UK labour productivity declined by 0.5% in the first three months of the year with productivity in the services sector shrinking by 0.6%. This means that workers, and their managers in the UK have produced less per hour than in the previous period. It has been reported that a British worker takes 5 days to produce something a French worker can do in 4 days and a German worker in 3.5. In fact, despite numerous rounds of cost cutting since the financial crisis of 2008, productivity in the UK is now back to levels seen in 2007. And that last sentence points to one of the reasons behind this. Managers have been focused on cost cutting which typically results in headcount reductions, a reduction in investment in new technology and a clamp down on external spend, such as consultancy and training.

Perhaps this might not be the answer after all…

The solution may, in fact, lie in more targeted spending aimed at creating a highly skilled workforce supported with the tools and technology required to deliver more for the same effort. Give managers the skills to manage their teams and create an environment where collaborative working and continuous improvement is the norm. Give them the tools to measure performance – and I don’t just mean time at work but also actual output – and build in objectives that support and encourage them to address the issues that are holding the business back. Once the spiral of decreasing productivity is broken, successful businesses see the results which can then be re-invested in further improvements in a virtuous circle. As output increases the resources become available to invest in new tools, new technology and more training.

This takes time and effort – it is certainly harder than cutting a position or two – and possibly doesn’t give such immediately obvious results, but given we have spent 10 years going nowhere it must be worth a try.

ProductivityTech

Future Proofing Your Business in an Uncertain Future

16-06-2017

With the recent snap election, Brexit and Donald Trump winning the US presidential election the economic future in the UK could be said to be uncertain.  In order to prepare our businesses to survive whatever the future may throw at us, it is important to invest time and effort now to getting the business in the best shape to allow it to flex easily to the needs of the future.

If it was easy to do this then all businesses would do it and it would be second nature to us all, but to be effective and sustainable there is a need to invest both time and money.  Both of these things are often seen to be in short supply especially when there is uncertainty on the future.

So what can businesses do?

1. At all levels of the business review the key processes to check they are fit for purpose today and for where you as a business want to be in the future. If not start to identify the areas of weakness and start to take steps to strengthen them for the future.

2. Review management personnel, team leaders/supervisors and above. Are the right people in the right roles? Do they have the skills to drive performance in the future? Do they do what they are asked in a mechanical way they always have? Are they open to change and the challenge ahead?

3. Review team skills, do the right people have the right skills to meet the type of work the company is dealing with now, and expecting to deal with in the future. If not put training plans/budgets in place and mentoring to get the managers of the future ready to take on the next challenge.

4. Define what is a good day and a bad day, and work out what causes those bad days and how the effects can be minimised in the future. Don’t forget to consider what will be considered a good day or bad day in the future and how you will measure this.

5. Design your reports to drive performance now and bring it in to focus, as well as making them adaptable so they can be changed in the future with little fuss.

6. Review the meetings managers attend, are they just a general catch up, are they producing an effective results or is it a meeting just for the sake of having a meeting? Is there better ways of running meetings in the future (e.g. video conferencing) and what facilities are needed to make this happen in the future?

When these ideas are put to management the objections often heard are “we don’t have the time to do this”.  This is when having an external team coming in is beneficial in order to focus solely on these changes and driving them through, while taking some of the pressure off the staff, but at the same time requiring input from the staff of the business.

Nobody knows what the future will be, so we need to infuse our businesses with action and a desire to improve.  Not wait for things to happen, but make them happen for us in the way we want them to.

uncertainty 2

Quote-To-Cash – is it really working for you?

26-05-2017

In business we often look at the teams in the front line as the ones that have greatest impact on productivity and effectiveness. They are also often the first place looked at when profits are not what the company expects. However, the back office is also the place where much time and many deals can be lost, especially when we are too busy to do the order processing and searching for quote, which give the customer a faster and better value service.

Often the measurements in these areas drive the wrong behaviours, a measure of how many quotes are issued or orders processed only provides part of the picture; but when combined these give us a conversion rate, which can indicate if the quote to order process is being effectively managed, or if there are issues that need to be addressed.  There are other things to be considered as well relating to how many times a quote is issued and why this is required.

Moving on to how the order is processed once received, opens up more areas for consideration, do we have fixed, preferential rates with our key suppliers? Does the internal process for processing orders enable us to meet the client’s expectations? Are there the necessary checks along the way to make sure, before the goods go out the door, that they going to the correct address and person?

So now the customer has the goods how do we make sure the invoicing and subsequent payment of those invoices goes as smoothly as possible, so as to prevent, as much as possible, the need to issue credits or write off debts? Who is responsible for chasing non-payment or any invoice queries?

At all stages of this process there are a number of interfaces between different teams/departments and a detailed process flow can enable the identification of these interfaces and what needs to be done to make them more effective.

The solution is not just a new IT system to automate the process further, it is about getting the behaviours of those in the process right and their understanding of why they are being asked to do things differently to achieve what is needed.

To remove the potentially emotive nature of finger pointing as to where the problems occur, it is often easier for this exercise to be undertaken by a team from another area of the business,  or a totally independent team.

At the end of the day, the answers about how to achieve these and much more will vary from company to company, but getting the Quote to Cash process right will make your business more profitable and increase sales, as it helps identify why some quotes don’t convert and allows us to get closer to our customers and suppliers in order to give, and get, the best deals, as well as reduce delays and errors in this key and often forgotten process.

Q2C

Body Language – a foreign language we all need to learn

26-04-2017

Vincent Nichols an English Clergyman said, “We’re losing social skills, the human interaction skill, how to read a person’s mood, to read their body language, how to be patient until the moment is right to make or press a point. Too much exclusive use of electronic information dehumanises what is a very, very important part of community life and living together”.

As consultants, we are often ourselves in front of teams or individuals where we haven’t had time to learn all their quirks and traits. Therefore, an understanding of body language can help us read the situation and tailor our approach accordingly.

There are obvious signs that we all instinctively notice in others, such as a nod of the head, folded arms, sharp intakes of breath, along with positive and negative facial impressions. All of these give us information about how the other person is reacting to what we have just said or done. There is more we can learn from those we are dealing with; if we just know what we are looking for.

Throughout this learning process there will be an element of trial and error and occasionally we misread the signs. Just like learning French, where there are words that sound like English words but mean something totally different, in body language the context and environment can change the meaning of a gesture. For example, leaning back in a chair with your hands behind your head while at home is normally a sign of being relaxed, while in a meeting it could be a sign of arrogance/lack of interest.

To start learning and understanding the finer points of body language, you need to observe the behaviours of yourselves and others. Just look around the office or room you are in as you read this and think about what the people near you seem to be saying with their body, not their words!

Once you start to notice things, it’s time to decode them. That’s the hard bit! To do this takes time, practice and a bit of reading. Is it frustration, acceptance, boredom or thinking about a solution? Some things are conscious and others are unconscious; those that are unconscious are the ones that tell us what someone is truly feeling. Conscious actions are the ones that can be manipulated and therefore the ones that can be used to fool others.

Once you can decode the signals, you can decide how to adapt your approach to either engage the audience better, reiterate or reinforce a point to ensure your message comes across and is fully understood. Adapting is all about changing your behaviour to change the response you get.

This works just as well in sales and personal relationships as it does with consultants and clients. The desired outcome is one where the communities in which we live and work are more successful and in business we have the competitive edge to keep us one step ahead.

 

body language

It’s good to talk

24-03-2017

As the late, great Bob Hoskins reiterated in the nineties as part of the BT ‘friends and family’ campaign, it’s good to talk. It’s been over twenty years since the advert was first shown and environments have changed, but the meaning couldn’t be more appropriate.

In the ever changing business environment, in which we all take part, we recognise the importance of communicating, however gauging when and how is best to communicate can be tricky.

The environment in which we work today has vastly changed since the existence of the internet. With the rapid growth in technology, there is now a range of communication methods available; from email, instant messaging, social media and conference calls, with the list ever growing. There are more than enough ways to communicate and often they can amount to message overload for employees. Research by Radicati highlights that in 2015, 122 business emails were sent and received worldwide per user per day, with the suggestion that this figure will rise by 3% year-on-year.

How much time out of your average day do you spend sending and receiving emails that aren’t necessarily adding any value? Are we just emailing for the sake of emailing? Is it more appropriate to have a face-to-face conversation, or even a phone call? Would we get to where we want to be faster if we used a different avenue of communication? These are the sorts of questions we should all be asking ourselves when thinking about which method of communication is best. Yes, we may have the technology to support multiple communication strategies, but how do we know when is best to use each type and what are the behaviours that drive us to do so? Is it better to take it back to basics and have a face-to-face conversation?

In short, not always. It depends on the situation and the message we are trying to convey. Our passion to drive performance and change behaviours across multiple operations is hinged on our ability to use the correct communication methods in the correct situation. When information is not transferred in the right way, it can be misunderstood or even misinterpreted, resulting in tasks being completed incorrectly, leading to lost time and ultimately low productivity. Driving the performance of your operations can be a sensitive topic, often an incorrect assumption is made that it is automatically about ‘cutting heads’.

Managing performance can be difficult and giving managers the correct tools to do so is important. Trying to manage performance through email communication will just not get the desired results we are all looking for. Having the ability to read the recipient’s reaction through body language and emotion is key to understanding the issues and ensuring the message is not incorrectly portrayed. In order to change behaviour, you need to understand behaviour, and this is not something that can be seen from an email.

Yes, in the right context and environment, emails can add value and by no means should be discounted. However, when wanting to embed behavioural change; engaging with your employees, understanding the issues and gaining buy-in are all crucial in making any behavioural change sustainable.

So agree with Bob, it’s good to talk.

email overload 2

Time and task management - Making the most of your day

27-02-2017

The daily struggle for almost all employees across any industry, is time management. As the list of tasks ‘to do’ grows, time ticks faster. So much so, that it’s become the norm to work outside of ‘normal’ hours, just to get the job done. Some people are able to balance their time well, whilst others are left with much longer days due to an ever growing list of tasks.

It’s easy for managers to encourage better time management, after all the perks are widely known – better time management leads to reduced stress, improved productivity, time for value-add activities, and ultimately more time to do the things we want to do. But being able to put the theory into practice is a challenge in itself; and the first step is understanding the difference between time and task management.

Time is a continuous unit of measurement. Time will keep on moving at the same pace throughout the day, and as such is pretty hard to control in itself. A task is a piece of work assigned to be completed within a given timeframe. Managing time is a result of managing your tasks; greater control over your daily schedule gives you the balancing power.

Below are three tips to effectively time and task manage:

1. Task Planning – the power of a ‘to do’ list is key. Writing down a list of things you plan to accomplish in a day, is one way of limiting yourself to a manageable level of work. By setting a realistic timeframe against each task also puts the day into perspective.

2. Prioritisation – simply writing the ‘to do’ list is the first step. Working through it you should focus on the most critical items first; the ones with the earliest deadline, or have the highest pay-off through delivery. Priorities do change throughout the day and the list can be amended to reflect this, keeping you one step ahead of the clock.

3. Bundle by Type – if, for example, you know you have 3 phone calls to make, and 6 emails to write, do them in blocks. This is similar to using the popular theory by Smith, ‘division of labour and specialisation of skills’. It may be on a much smaller scale, but will reap the same benefits.

With better time management, not only do individuals benefit, so do the companies we work for. Just a small change to the way we start our day, such as setting out a ‘to do’ list, enables us to plan more effectively. This is a key element to increasing productivity, and hopefully ensures you get out of the office door on time!

Time and Task Management

Keeping on Track when Time is Short

30-01-2017

For us all to keep on track with tasks when time is short can be difficult, none more so than in the rail industry, where we often hear of over-running engineering works. But it is not just about the time the engineers have track possession that impacts what can be done, but how well the work is planned.

When you know in advance that you are getting possession of section A of track B, it is essential to make the best use of the time you have. Therefore you need to consider the other tasks that can be done at the same time, in the same area, without compromising skills or equipment needed. By planning work in this way, by location and skill sets, it should be possible to carry out work concurrently, thus reducing the need to get track possession time and time again.

Working out an effective preventative maintenance schedule to meet regulatory requirements and fitting the available resources (manpower and equipment), takes time and effort and an accurate knowledge of the assets, their location and current maintenance schedule. Done correctly, it should increase productivity by reducing travelling to the same locations multiple times, having the maintenance/engineering teams effectively manned, a 2 man team doing 2 man jobs, rather than a 3 man team doing 2 man jobs.

It may take a period of time, possibly years, to move maintenance schedules around so they fit perfectly, but with a plan in place to do this there is light at the end of the tunnel. By ‘perfectly’, we mean a balancing out of the workload, so that teams have the right level of work and are not sitting around with nothing to do, or so rushed off their feet shortcuts are taken. Seasonal trends can be identified over time to help with this and the planning of reactive work flows.

This type of planning is ideal for preventative maintenance works. When it comes to reactive works there is a little more thinking that needs to be done; is there any other work that can or needs to be done in the area? This could be by bringing forward non-essential/low priority work, which could include preventative maintenance tasks if possible. Limitations might be imposed by minimum regulatory intervals that need to be considered.

In many elements of the workplace and workplace processes, concurrent activities allow for timelines to be compressed and more effective use of the resources made available. This allows for greater productivity and utilisation of resources. More often than not a fresh pair of eyes, or challenges to the norm from an outsider, are just the triggers needed to start to identify the changes needed.

Click here to view our case study following work with Nottingham Trams.

Case Study 2

Not-For-Profit vs For-Profit sectors: are they so different after all?

13-10-2016

Upon first glance, the answer would appear to be a fairly firm “yes”.

Firstly and fundamentally, not-for-profit organisations exist to fulfil a social purpose; their ‘mission’. In contrast, private or ‘for-profit’ organisations, as the name suggests, exist to make money. Any funds secured above target by not-for-profits are directed back into the organisation to fund additional services or programmes, rather than into the pockets of shareholders, as is the case with private businesses. For example, when the #nomakeupselfie campaign raised over £8m in 6 days for Cancer Research UK in 2014, this unexpected income was used to fund 10 new clinical trials, which otherwise the charity would not have had the means to fund. Culturally, this sense of working towards a ‘greater purpose’, instils a passion and commitment within the not-for-profit workforce that can be difficult for other sectors to replicate.

Accountability is another key area of difference. Not-for-profit organisations often rely entirely on donations, and as such are accountable to the public for their spending, something which in recent times has been subject to increasing scrutiny. It therefore comes as no surprise that not-for-profits are likely to have tighter budgets and less resource available to them than their private counterparts. Though this can present challenges, it can also encourage creativity and innovation. Whilst any private business will tell you that keeping costs down is pretty important to them too, this level of responsibility and trust is unique to the not-for-profit sector.

Whilst charitable organisations do not make profit for profit’s sake, it is important to remember that, just like businesses, they must ensure the organisation’s income exceeds its expenses, and face consequences if they do not do so.

Not-for-profit and for-profit organisations are both operating in increasingly regulated and competitive environments. Organisations in these sectors must work hard to deliver excellent customer/supporter experiences, and to develop innovative new products to make them stand out from the crowd, whether that’s Google’s ‘Pixel’, or Macmillan’s ‘Go sober for October’. In addition to staying abreast of their competition, it is vital for organisations across all sectors to adapt to their ever-changing working environments. Whether these developments are political, economic, social or technological, it is the organisations that are able to anticipate and flex, in order to meet challenges and seize opportunities, which thrive.

Finally, and perhaps most importantly, finding and retaining great people remains a key challenge across both the private and third sectors. In both cases, strong leadership combined with an effective management operating system are crucial, and are the differentiating factors between high and low performing organisations. A robust management operating system equips leadership teams with the tools to effectively forecast, plan, control, report on and review their area of responsibility. When resources are limited, the importance of a well-thought out plan, and the regular appraisal of this plan vs what is actually happening, is heightened yet further.

Being able to accurately measure, interpret and use this information to eliminate issues and drive performance improvements remains the bedrock of any successful operation; whether that operation makes millions providing I.T. support, selling children’s toys, or channels millions into funding medical research or educational programmes.

Perhaps they’re not so different after all.

 

prof-nfp

"Jobs take as long as they take”

18-08-2016

Within the transport sector, operators are under increasing pressure to reduce cost. Train franchises are becoming extremely competitive and the last 12 months has seen falling margins for many bus operators. As pressure on margin builds, those responsible for large maintenance or production operations are being tasked with improving productivity and taking cost out. Whilst simply reducing headcount is the obvious option, this does not deliver performance improvement and is therefore not a sustainable solution. So how do we maintain, or even increase, service whilst reducing levels of resource?

It is not uncommon to see transport maintenance operations struggle with high overtime costs, poor productivity, repeat failures and high rates of no fault found diagnosis. Vehicle availability and passenger service is negatively impacted and, in some cases, punitive financial penalties are incurred for SLA failure. In addition to these challenges there is a need to reduce cost. Lessening headcount without improving productivity will simply result in less work being completed, or jobs being rushed and therefore affecting quality. Consequently, overtime increases to keep up with maintenance regimes or a backlog builds up, potentially leading to SLA’s being missed. In addition, as quality falls, rework increases, creating further workloads.

Maintenance operations often have a lack of robust operational controls to measure engineer performance. In addition, there are usually a number of depots, each operating in their own way, making it difficult to compare performance on a like-for-like basis. Without a standard platform and base, how can we quantify the opportunity for operational improvement, and identify the potential for cost reduction?

For many years maintenance operations have been faced with an attitude of “jobs take as long as jobs take”. Supervisors typically don’t have the tools at their disposal to identify poor performance and take action to deal with the issues. Standard job times are needed to firstly calculate the resource required to meet workloads, but also compare actual performance against these standards. Through reviewing performance on a task-by-task basis, we can start to capture the issues impacting productivity and resolve them, thus driving wastage out.

Productivity is typically measured, somewhat crudely, by jobs per man, per man day. This does not provide a measure of true productivity, as it depends on how long each job should take. To capture true productivity you need to combine utilisation with effectiveness (time taken versus standard job time). Using this ratio, poor productivity can only be caused by not having enough work, or issues extending job completion times. By capturing and resolving the issues impacting productivity, you can drive out the causes of wastage within an operation.

Driving productivity in a sustainable manner provides the opportunity to reduce headcount whilst maintaining levels of service. In order to achieve this, you need a system. The model below summarises, at a high level, a Management Operating System – a closed loop tool used to drive out wastage, create capacity and deliver continuous improvement.

MOS

 

Much has been said about the performance of the England football team in the recent Euro 16. An underachieving England are left scratching their heads as to what went wrong. Initial reviews have pointed to lack of a system within which to operate, whereas Wales clearly played to their strengths within their system and overachieved. There is a lot to be said about an effective system!

Delegation – the management skill that gives you more time!

05-07-2016

If you search the internet for articles on how to delegate effectively, they all pretty much say the same things; pick the right person, confirm their understanding, agree deadlines, follow up at the agreed intervals and give feedback after the work has been completed.

All of this sounds great, but if it is really that simple why do so many managers get it wrong? Simple answer is we are control freaks – if we do it, then it is done to our standards and we won’t have to do it again. Part of this statement is very misleading – in the short term, it may take a little longer, but by training/guiding another person through the task it will take you (the manager) less time to review, therefore you have more time to do other aspects of your role. Also you are challenging your team members to grow and allowing those who perhaps simply need a nudge to develop into a future team leader themselves.

Let’s be honest, we have all been caught out when we have delegated work and it has not been completed on time, or to the required standard. So it’s a question of what made the delegation of the work ineffective? Normally it can be down to one of the following reasons:

  1. Prepare – A fundamental step is the need to take time and develop the discipline to map out exactly what you’re asking for.
  2. Assign to a suitable receiver – Once you know what you are asking for and the detail involved, you need to communicate this effectively to a suitable receiver. When a compromise is needed, your preparation will help you decide where the priorities are.
  3. Confirm understanding – Done correctly it can take as little as a minute. Don’t assume the receiver understands; ensure you clarify their understanding by demonstrating back to you.
  4. Agree commitment/acceptance – They need to accept the tasks you are giving them and understand the consequences to them, the project or the company in the event of failure to achieve the desired outcome, and ensure their overall goals are aligned with yours.
  5. Avoid “reverse delegation” – It should not be the case that tasks once delegated come back to the manager to be completed (some employees are good at passing the work back!). Don’t let them! If an employee reaches an impasse, treat it as a learning opportunity. Coach the employee through it, making sure he or she has the resources and knowledge needed to complete the task. That way, you’ll still be free to focus on other things, and the employee will be better equipped to carry out similar tasks in the future.
  6. Follow up at appropriate intervals – Communication is a two way process and it is no good finding out at the deadline that the task has not been completed or is not to a satisfactory standard. For longer tasks agree regular updates and make sure that you are confident you are getting the true story, not just what you want to hear.
DELEGATE

The art of delegation becomes more natural the more you practise it, and once you have mastered it you will see that you have more time to spend on the key functions of your role and reap the rewards.

Just be careful that your manager doesn’t delegate too much to you!