Labour Productivity at the Organisation Level

Transcription

1 Labour Productivity at the Organisation Level

2 People Solutions Who are we?

3 Labour Productivity the facts at a country level Australian labour productivity (measured in GDP per hour) grew at an average annual rate of more than 1.0 per cent over the 10 years to 2012, exceeding many major developed economies, including the UK, Germany, Canada, France and Italy. According to The Conference Board survey, Australia performed particularly well in 2012 and 2013, with respective annual growth rates of 2.1 per cent of 1.8 per cent, well ahead of each of G7 nations and many mature economies. Austrade August 2013

4 Labour productivity has just recorded its fastest two years of growth since Average growth of 2.5%. The Australian, March 2014

5 Sector by Sector Year to date to March quarter 2013 Sector % change Comment Mining -5.7% (WA level -4.4%) Change over 5 years -37.9% - Had been a small level of improvement in last three quarters - Mining output increased by 8% yet hours worked increased by over 15% Source: Price Waterhouse Coopers Productivity Scorecard June 2013

6 Labour Productivity at the Macro Level Year to date to March quarter 2013 Sector % change Comment Financial and Insurance Services +5.7% - Hours worked declined while output increased. - Stabilising financial markets. Construction +3.8% - Increased output and decrease in hours. - Third year exceeded average growth. - Second largest employer so improvement significant. Source: Price Waterhouse Coopers Productivity Scorecard June 2013

7 So why the focus on labour productivity?

8 International Competiveness High costs NEED TO NARROW THE GAP Labour productivity

9 Example Australian workers take roughly 8% longer time to complete their work than their Canadian counterparts. (McKinsey and Company Extending the LNG Boom: Improving Australian LNG Productivity and Competitiveness, May 2013).

10 What is happening at the company level? Significant focus on this area in the last 12 months. Process improvement Six Sigma, continuous improvement, lean, etc Technology improvement. Has been reduction in number of employees in the industry hours worked will continue to reduce.

11 The People Solutions Labour Productivity Report - Produced twice yearly - Identifies the prevailing sentiments and trends in the management of labour productivity at an organisation level.

12 Summary of last survey 59 companies employing over 60,000 employees. Demographics Mining/mining contracting 30% Engineering/construction 22% Oil and gas/o&g contracting 14% Other (utilities, services, health) 17%

13 Is labour productivity currently an issue for your organisation? 72% Yes 25% No 3% Unsure

14 Does your organisation measure labour productivity? Yes 36% No 64%

15 Does industrial relations impact on labour productivity in your organisation? 23% Slight to significant impact

16 The Elephant in the Room Does industrial relations impact on labour productivity in Australia?

17 Business Wide Labour Productivity Influences Macro Level Labour Productivity Influences Labour productivity Improvement Work Group Labour Productivity influences

18 DRIVING LABOUR PRODUCTIVITY AT THE ORGANISATION LEVEL People Productivity & Efficiency (PPE) People Solutions 2014

19 What are the factors that most impact on labour productivity in your organisation? Efficiency 32% Capability 30% Structure and Roles 15% Knowledge and Capacity 10% Unknown 13%

20 Labour Productivity measurement. Need to focus on what an employee and their work group can control. To impact on the motivation of employees, what is measured must be something the employees can control. Need to measure labour productivity from the work group level.

21 Integrated Approach to Labour Productivity Improvement Discovery prod data at org level Measure labour productivity Identify Prod measurement at work group level Improvement Intervention Monitor Labour productivity Monitor Labour productivity Assess Through PPE

22 Thank You