Investing in process, tools and training to achieve greater productivity
Challenges to investing in processes, tools and training to achieve greater productivity, as reported by organizations surveyed |
| Ranked by frequency of mention |
| Rank* | Challenge |
| 1 | Insufficient budget to achieve objectives |
| 2 | Results of investment not yet apparent |
| 3 | Insufficient investment in personnel |
| 4 | Organisation is still in cost-saving mode |
| 5 | Organization focused on competitive pressures rather than capacity-building |
| * Based on 390 responses from our global multi-sector survey. Rank order may not reflect statistically significant differences in all cases. Unclassified/refused responses not shown. |
Relative proportion of respondents reporting staff development vs. cost optimization programs, by sector
Factors enabling investing in process, tools and training to achieve greater productivity, as reported by organizations surveyed |
| Ranked by frequency of mention |
| Rank* | Enabling factor |
| 1 | Growing recognition of importance of training and staff development and willingness to invest in same |
| 2 | Need to achieve more with the resources currently available |
| 3 | Need to improve the efficiency of business forecasting, planning, budgeting and reporting processes |
| 4 | Identification of area where further cost optimization potential exists |
| 5 | Ongoing program to increase productivity |
| 6 | Recognition of importance of improving internal communication |
| 7 | Increasing appeal of building new competencies |
| * Based on 390 responses from our global multi-sector survey. Rank order may not reflect statistically significant differences in all cases. Unclassified/refused responses not shown. |
Over 4 in 10 organizations are investing in staff skills and development to improve productivity.
Summary: Sectors vary in the degree to which cost optimization or staff development is used to improve productivity. Banking and public administration respondents report the greatest number of challenges in improving productivity.
The second-rung opportunity on the ladder is also one with cross-functional appeal: achieving greater productivity. Overall, executives expect this opportunity to continue to rise in its potential impact as 2013 approaches.
Opportunity outlook and impact
Individual sectors and countries vary widely in the relative importance they give to this opportunity.
Sector perspective
- Power and utilities and public administration respondents report that productivity is their top priority.
- Banking executives rank this opportunity only in fifth position overall.
Geographic view
- Productivity is a key focus for executives in most of the BRICs (with the exception of Russia) and in continental Europe.
- Executives in the US and UK are relatively less likely to feel this is a high-impact opportunity.
Obstacles to success
Our survey results suggest that the principal barriers to improving productivity are:
- A lack of investment in skilled personnel
- An insufficient budget to make the necessary process investments
- An organizational focus on competitors, rather than on operational effectiveness
Overall, respondents in the banking and administration sectors appeared most likely to report significant barriers within their organizations to making significant gains on this opportunity.
Executives in China, Poland and Sweden were similarly more likely to report that their organization placed insufficient emphasis or resources on improving productivity.
Most sectors expect the importance of this opportunity to rise as 2013 approaches. A notable exception is public administration, which predicts a fall in importance.
Responding to the opportunity
The key strategy for improving productivity — mentioned by over 4 in 10 organizations in our survey — was a focus on investing in staff skills and development.
The second most important strategy, cited by nearly 3 in 10 organizations, was a focus on cutting costs.
Reflecting a continuing scarcity of investment capital in many firms in the aftermath of the global financial crisis, many respondents commented that their goal was to "achieve more with the resources available."
Sector strategies
- Executives in banking, public administration and retail were more likely than other sectors to focus on developing staff skills, and less likely to prioritize cost cutting.
- Respondents from the oil and gas industry were much more likely to prioritize reducing costs above developing staff skills.
Geographic approaches
Despite the global importance of improving productivity, it is more likely to be used by companies operating in certain geographical regions.
- Executives in Europe (with the exception of Italy) and Russia are highly likely to manage productivity actively.
- Executives in the Middle East, US and China lag behind.
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