Quebec and Canada lag behind in terms of productivity compared to other industrialized countries. With $ 60.15 of GDP produced per hour worked in Quebec and $ 66.96 for Canada, we are therefore behind the United States ($ 82.03), Germany ($ 87.38) and Belgium (93.43). Not to mention that our average increase in productivity was only 0.9% per year, from 1981 to 2017 – the lowest ranking among industrialized countries.
In its 2018 assessment “Productivity and Prosperity in Quebec ”, the HEC emphasizes that on average, 95% of the economic growth observed over the past 36 years has been generated by productivity gains, and that Quebec has recorded one of the worst performers in this regard. As a result, the gap is widening between our average standard of living and that of other countries, and will continue to widen if we do not improve our performance.
This week, I suggest covering the many facets of productivity that the current crisis can make us think about:
- Manufacturing and automation
- Productivity in all spheres of a business
- The new recruiting reality
More than words
The interest in improving productivity is present among companies, and supported by government programs encouraging R&D and innovation.
The results are not aligned with intentions, because still according to the HEC’s 2018 assessment, Quebec invests on average 28% less than the rest of Canada in equipment and materials, and is even at the tail of industrialized countries.
Several well-known companies have been successful in different industries. Whether in food (Sobeys with their distribution center in Terrebonne), in industrial distribution (Lumen, Quincaillerie Richelieu) than in logistics services (Wiptec), not forgetting Purolator and Amazon, all recognized for their operational efficiency often acquired through automation.
Not all companies can achieve this level of automation. Any improvement should be done one small project at a time, step by step, in order to achieve concrete results with the best return on investment (ROI) possible.
‘’ There are usually 3 triggers that encourage companies to improve their productivity ’’, according to Charles-Antoine Marcil, project director at GCL Group, a management consulting firm specializing in Logistics and Supply Chain. ‘’ They are experiencing significant growth requiring changes to happen, they are facing challenges related to the shortage of labor or they wish to identify the technologies that will allow them to make better use of the resources in place ’’.
Not just manufacturing
The term “productivity” is often related to the manufacturing sector, to mass production. However, each member of an organization contributes to the efficiency of a company and can bring a facet that will make the process “lean”.
Imagine that the chain of your processes, from your suppliers to your customers, is a series of pulleys, with a rope that connects them from start to finish, and that this rope has loosening in certain places. The identification of the loosening points which, once corrected, will make a significant difference to the whole process, will therefore be considered critical and a priority.
In order to bring lasting results, it is necessary to have a clear understanding of the current situation, review the processes in order to identify tasks without added value, define performance indicators linked to specific objectives, reorganize the work, and target employee training needs. The government has created a program specifically to encourage companies to use the pandemic period to train their employees.
Sometimes simple solutions can make a big difference. A great example of an aspect that is often overlooked: the more efficient use of common IT tools in place (Microsoft Office, Google Suite, etc.) which can significantly improve the efficiency of the workflow. Underdeveloped in most companies, intermediate and advanced functions can bring increased performance, once users are properly trained. As proof, Microsoft Excel, commonly used as a basic spreadsheet and filters, is a powerful tool with the use of pivot tables and macros. Little investment required and quick return!
According to Charles-Antoine Marcil, in order to achieve this, companies must adopt a long-term vision and be ready to invest. An alternative is also presented through the establishment of strategic partnerships with companies that have already optimized their processes. For example, companies that are growing their e-commerce use the services of a third party for logistics operations to capitalize on their expertise, keeping focus on their core businesses.
Teleworking: Formerly misperceived, now part of the solution?
Businesses had no choice but to implement teleworking during the crisis in order to continue operations while protecting employees, reducing the risk of contamination. Concrete benefits are derived from this: less time lost in traffic, an improved quality of life, a better work-family balance – while bringing increased efficiency thanks to the technological tools available.
In order to ensure the effectiveness of teleworking, the expectations of the employer must be clear, supported by established performance indicators. A revision of companies’ working methods in order to adapt to this new reality could thus lead to greater benefits than one might think, as much efficiency as financial.
From a recruitment point of view, telework makes possible to widen the geography of research and to seek out talents who otherwise would not have been available.
According to a survey by Indeed in late 2018 of 500 employees and 500 Canadian employers, 60% of employees say that teleworking is an important criterion when choosing a position, and 36% of employees plan to accept a salary lower against the possibility of working remotely. Companies will therefore have to adapt to this new reality.
Employees with different skills
With these changes, organizations will need to make sure they communicate the new skills sets they need from candidates to recruiters. New technologies require different technical skills. Leaders and managers will need to be skilled in managing change to engage their teams in the transition, but also to foster greater collaboration and ensure success to gain productivity. Find people who want to contribute to the success of the business through their ideas in a continuous improvement approach.
More than ever, productivity and efficiency will have to be on everyone’s priority list to ensure the sustainability of our businesses. It will no longer be a choice, but a necessity.
How will companies react, what concrete actions will be taken?
How ready are they to invest – especially since the current crisis will leave a significant impact on their finances?
What will be the support of the different levels of government, other than financial, to encourage companies to become aware and put concrete actions in place?
Should we establish performance targets as a province or a country so that we can follow the development through actions that will be taken?
One thing is certain: we have the resources and the talent to do this.
You want to discuss your recruitment strategy that will allow you to build teams focused on improving your productivity and operational efficiency?
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