“Karl Marx would be amused. He longed for the day when the workers would own the means of production. Now they do.”
Charles Handy
According to the PWC Global CEO Survey published in January, an astonishing 40% of work at most companies is wasted productivity. That’s a massive drain on resources and represents the largest strategic opportunity for CEOs today. They can dramatically improve organizational performance simply by recapturing this lost productivity potential. How big is this opportunity at your company?
Is the 40% number real?
Through our work over the last eight years, we confirmed that this 40% loss in productivity is unfortunately the norm. This means that a company with a $5 million dollar payroll is wasting $2 million in productivity potential. And this only includes getting assigned work and projects done. The loss is even larger because the innovation potential of these organizations remains untapped.
Why is this percentage so big?
Because leaders know everything about their products, processes and financials, but almost nothing about the human element. And it is the human element that holds organizations back: Unproductive meetings; slow execution; uncollaborative teams; an uninspired and disconnected workforce; walls and silos; constant interruptions; unproductive behaviors; remote worker disengagement; and a limited sense of belonging.
If the opportunity is this big, why aren’t C-Suites focused on it?
Because it’s a blind spot. Businesses are still managed with an industrial mindset. They focus on ensuring that the factory – the processes and technology – perform at their peak. In the industrial era this made sense. Workers were incidental. The large capital investments in raw materials, plant, and equipment, accounted for 80% of business expenditures. Naturally, management was preoccupied with optimizing returns on those capital investments. Workers (human capital) were of secondary importance. They were simply low cost, interchangeable par
However, in today’s digital era, the reverse is true. People are the most important tool in just about every company, accounting for 80% of expenses. The culture is the factory. Yet, leadership teams focus on the performance from their business process and technology infrastructure, not their talent and culture. Both should be optimized, but talent and culture are the biggest ROI opportunity of any strategy – in fact, far greater than AI. Even single-digit productivity increases yield game-changing results when multiplied across a whole workforce.
If you are interested in learning more, here is a link to an article on how you can leverage the human factors of productivity to build a deeply engaged and productive workforce:
Why Companies Struggle to Increase Workforce Productivity and What to Do About It.
How much money are you leaving on the table? Find out for free.
C-Suite members can take advantage of our free Productivity Check Up to discover how much unproductive work is costing your organization. For a limited time, you can get this $2500 service for $0 (free).
Please click on this private link to get started: Link.
About PeopleProductive
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About the Author
Frank Wander (LinkedIn) is a CEO, Board Member, author, former Fortune 250 turnaround CIO, and Founder of PeopleProductive, Inc. His company’s leadership development technology upskills leaders so they are able to unlock the full potential of their workforce – without burning people out.