Tuesday, March 27, 2012

Over emphasis on productivity again

I've recently read a few articles on training and it shows that many local bosses do not understand the importance of training.One of them even link sending of staff to go for training to productivity. It was not put down in words but personally, I felt that the boss thinks that sending staff for training leads to a drop in productivity.

I guess they did not read the recent Harvard Business Review study lead by Zeynep Ton, an M.I.T professor. He surveyed 4 low-price retailers in the US and he found that:
  • these companies have much higher labour costs than their competitors
  • they pay their employees more
  • they have more full-time workers and more salespeople on the floor
  • they invest more in training them.
but these stores
  • are better places to work
  • are more profitable than most of their competitors
  • have more sales per employee and per square foot
It was actually shown that customers do appreciate properly trained staff as they are able to assist them in the decision to purchase.

The research above shows that even though you spend more on your employees, you are actually more profitable than your competitors. It does show that we should not focus on a specific process to achieve higher profitability, but look instead at what we must do to achieve higher profitability.

The focus should not be always at productivity. It's not the only way to increase your profitability. By narrowing your focus, you lose sight of the final objective and in fact, the result may be the exact opposite of what was intended.


Anonymous said...

singapore's managers are generally not very good. they do not always see the worth in motivating staff. they do not seem aware that happy people perform better. it passes them by that tired people do not perform as well as those who've taken a rest or perhaps stepped back from something or taken a break from gnawing at a problem.

they do not appear aware that sometimes egos need soothing, sometimes pple need encouragement, other times a listening ear, or some praise. that occasionally they need a bit of a kick in the arse. mgt skill is knowing when to administer these.

here, it's all keep your nose to the grindstone. keep going till you're done. and VERY VERY RARELY does one get any praise or appreciation.

i disagree with you about the productivity bit. the training in how to serve has made the trainees more productive, ie they sell better. and thereforefore, the higher profitability.

chantc said...

That's unfortunately true. There are not many good managers, or team leaders around.

I'm not saying that training does not lead to higher productivity, but that is never the only focus. If you focus on productivity, would you look at making the surroundings a better place to work, pay their staff better, more workers means better quality?

I can say many of the bosses when they focus on productivity, they only look at allocating more work to one person, or sending the staff for on the job training (meaning accepting a job even though the staff may not have the necessary skills). That is what happens when you focus only on one aspect, which is my main bug bear.

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