Why Grow Sub-Optimal Performance?
by Rob Marchalonis.
(Portions of this post first appeared in the Central Penn Business Journal)
Business leaders, are you actively recruiting for new employees? Many employers are working to expand their teams because they believe they need more “hands and heads” to get the work done. Right now, business is good and growing for many, but the pool of skilled workers appears to be shrinking. December 2017 data from the US Dept. of Labor indicates that unemployment was just 4.1 percent nationwide, the lowest rate in over ten years. (Nov. 2017 data indicated 4.6 percent unemployment for Pennsylvania, 3.8 percent for York-Hanover, 3.6 percent for Harrisburg-Carlisle, and 3.3 percent for the Lancaster region.)
So, what are you to do as a business leader? If you see recruiting and hiring as your only option, you will be forced to attract the unemployed or lure talent away from others. Both present challenges. Many candidates who are not working fail to meet minimum employment criteria. Those who are employed (even with just average skills and experience) are in a position where they can negotiate high wages, salaries, benefits, and more. You may find yourself choosing between less-than-desirable or very expensive candidates. But all this activity overlooks one big employment factor, and that is productivity!
On a scale from 0 to 10, how productive are your workgroups? During the time I’ve spent with hundreds of businesses and employees over the past 20-plus years, I’ve seen very few workgroups who perform even close to their capacity or potential. That’s not to say that these workplaces and workers weren’t well-intentioned and good people, because almost all of them were. They simply performed way below what they were capable of for a variety of reasons. Addressing this opportunity is a challenge, but increasing workgroup productivity is often easier and much less risky than attempting to increase output by simply adding workers. In short, you may be much better off investing in the productivity of your current employees, before you add more who may continue to perform at a sub-optimal level.
I believe that many workgroups are about 60 percent productive. It’s my opinion and experts concur that the production from most functional teams or workgroups is somewhere between 50 – 70 percent of their potential, or about 60 percent on average. In a recently published book Time, Talent, Energy, authors and productivity experts from Bain & Co. share research showing how the best (top quartile) companies are over 40 percent more productive than their counterparts. They accomplish this because they:
• Reduce organizational drag.
• Put talented difference makers in key positions.
• Release the discretionary energy of employees.
Discretionary energy is the amazing ability and additional effort within every employee, if you can just find the right way to unleash it!
Surprisingly, for many workgroups 60 percent productivity appears to be adequate, or at least accepted, given how little is invested to improve it! But for how long can a workgroup’s sub-optimal productivity continue, and at what cost to the participants? Poor communication, weak oversight, inadequate accountability, bad habits, and minimal motivation seem to be common reasons why work groups under-perform. The good news is that many of these deficiencies can be turned around in relatively short order.
Every employee wants to be part of a successful team. Leaders, take the first step toward improved productivity by clarifying your organization’s goals and what it looks like to “win”. Next, embrace the process of continuous improvement where everyone is learning, developing, and enjoying the satisfaction and fun of overcoming challenges. Add incentives, where workgroups share the results or gains they help achieve, and watch the motivation and morale of your employees rise to record levels.
As more employees become actively engaged, not only with their daily output but also by identifying future opportunities, utilize their collective wisdom, experience, and effort to multiply organizational results. Reinvest the profits generated by increased productivity to reward the team and finance next level improvements and growth. Finally, organizations with a culture of high productivity and strong results are in the best position to attract, hire, and retain talent. Peak performers want to play for winning teams! As you invest in productivity, don’t overlook both the financial and employee benefits.
Productivity = Profitability + More
Take your organizational productivity to the next level. Because most of my work is directly linked to improving workgroup productivity, I’ve developed a short list of five strategic initiatives to help clients boost their team’s productivity before they add to their team’s roster:
- Strengthen your LSP. Improve your Leadership, Strategy, and Process deployment, the foundation of team productivity.
- Learn from Benchmarks. Find others that perform at high levels to learn from and be inspired by.
- IncentShare. Share your success with smart incentives that engage, motivate, and reward workgroup performance.
- Develop Proprietary Offerings. Develop niche products and services to gain better control of your destiny.
- Market Your Value. Fuel your growth by communicating and promoting the unique value you provide to others.
Productivity first. The time, effort, expense, and risk required to hire a new employee are greater than ever before, especially in today’s tight labor market. Before you add your next worker, consider the productivity of your existing workforce and how much it could be improved. Invest at least as much to help your team become more productive as you do to recruit and hire. Don’t overvalue a bigger workforce or undervalue improved productivity. Otherwise you may just add inefficiency, in greater numbers.
Rob Marchalonis (Rob@LSP123.com) helps organizations develop Leadership, Strategy, and Process solutions so they can prosper and grow. Read Rob’s book, IncentShare: Motivate, Recruit, and Get Results with Incentives, available at Amazon. www.IncentShare.com