Are you concerned about Productivity?
Things may be looking up but are you keeping up? According to the Office for National Statistic latest report UK labour productivity, as measured by output per hour, is estimated to have grown by 0.7% from Quarter 3 (July to Sept) 2017 to Quarter 4 (Oct to Dec) 2017; this is the second quarter in a row that output per hour grew, after falling in the first half of 2017. Labour costs make up around two-thirds of the overall cost of production of UK economic output. Changes in labour costs are therefore a large factor in overall changes in the cost of production. If increases in labour costs are not reflected in the volume of output, this can put upward pressure on the prices of goods and services, therefore this is a closely watched indicator of inflationary pressure in our economy.
I am aware of an increasing number of instances of companies employing labour intensive processes where systems could be used to do the work more effectively. Often work is done and then another team correct the errors, rather than getting it right first time. In my experience although using IT systems does not make you produce any more products, it make you more effective. One of the reasons that Japan is so productive is that they heavily invest in systems to ensure people are as productive as possible. Many times, I see people moving paper around the office, when electronic systems could do it instantly. Paper is filed and re-filed and then shredded when this could all be done electronically. Using e-commerce to move data around between companies and departments, this can reduce manual intervention, delays and errors and is easy to retrieve.
I believe the problem stems from the fact that many companies do not see their IT systems, and in particular System 21, as a tool to be more productive. But, I know from working with some clients that using the system properly means that manual intervention can be reduced and errors minimised — hence increasing productivity.
In my experience a review of IT Systems by an experienced consultant who can bring ideas and suggestions from many industries and companies inevitably leads to identifying opportunities for further investigation. Some examples are:
• Automatically processing supplier invoices
• Automatically paying suppliers though Internet banking
• Linking websites to System 21
• Handheld devices in the factory/warehouse
• Digital archiving of paperwork
To help you to start reviewing your use of IT systems I would be pleased to offer a FOC and without obligation review of your systems.