UK needs to grasp the nettle of poor people management

Feb 21 2006 by Brian Amble Print This Article

The British government has been accused of failing to develop a coherent policy approach to improving workplace productivity as a new report blames poor people management for the UK's appalling productivity performance.

After a year in which UK productivity growth fell to zero and with the latest international statistics showing that UK continues to trail its competitors in the productivity stakes, it is high time the government took a fresh policy approach to boosting workplace productivity.

The latest international snapshot from the Office for National Statistics (ONS) will show that UK output per hour continues to fall well short of what is achieved in France, the United States and Germany.

To coincide with the new figures, the Chartered Institute of Personnel and Development (CIPD) has published a report arguing that UK productivity will continue to disappoint in the absence of a joined up public policy agenda that promotes improved workplace management practice – Smart Work – across all sectors of the economy.

According to Dr John Philpott, the CIPD's Chief Economist, inadequate people management is the major factor underlying the productivity gap between the United States, the UK and the EU economies.

"Coming after a year when UK productivity growth plummeted to ground zero, the latest international comparisons will be disappointing for a chancellor who has for almost a decade put considerable effort into closing the productivity gap," he said.

Making improved people management and working practices central to the government's policy agenda, rather than treating it as subsidiary to what the Treasury and DTI consider the main drivers of productivity growth – such as investment, innovation, skills, enterprise, and competitive product and labour markets - should be a central plank of government policy, he added.

"The underlying problem, mostly overlooked by government policy, is that the vast majority of UK organisations still don't make a good enough fist of managing the productive resources they do have, especially their people.

"If this fact hadn't dawned upon Gordon Brown in 1997 the penny must surely have dropped by now, not least because his preferred brand of top down, target focused, management of the public services has failed to make the most of the billions of pounds of extra investment he has provided."

The report said that of the 22 indicators used by the government to measure productivity performance against the UK's major competitors, only one - executive perceptions of management quality - comes close to a measure of comparative practice.

And it called on the government to introduce a raft of measures to improve people management, training and work-based learning practices, together with minimum standard of external reporting by organisations of these practices and their impact.

"It must be extremely frustrating for the Chancellor to see UK productivity growth stall after nine years of policies designed to push on the accelerator," Philpott said.

"Like all his post-war predecessors Mr Brown has struggled against the reluctance of UK plc to invest enough in capital, skills and technology, despite his time in office being a period of economic stability.

"The trouble is too few UK organisations practice what they preach, while the government struggles to develop a coherent policy approach to improving workplace productivity.

"It's vital that an effective Smart Work strategy is constructed – and high time government, in partnership with employers and other relevant stakeholders, made a start."