Productivity measures the relationship between the quantity of output and the quantity of input. Increasing productivity means increasing the amount of output faster than the amount of input. The quantity of output can mean anything from the number of products produced over the number of clients served to the number of donors treated or the number of work passes produced. The entry usually summarizes all the resources needed to do this, from raw materials to equipment to working hours.
How is it possible to increase productivity? One way seems to be obvious: we have to work faster to get more things done at the same time. Although this request might have been correct 30 years ago, it is highly inappropriate today and would lead to even more frustration among people who are already overworked. It’s not about HOW FAST we work. It’s about HOW we do our job. It’s about the process, more than the people.
Running a process very fast does not necessarily mean that the process runs very productively. Although we have introduced IT support to all kinds of processes over the last 40 years with the effect of speeding up some processes, overall productivity has not shown the same amount of momentum. The productivity of a process can be increased by reducing the input, that is, the amount of raw material or labor used to generate results.
Therefore, the efficiency of a process is a good indicator of opportunities to increase productivity. There are many ways to achieve this – small changes and small gains can be expected through Kaizen, WITS, or Quality Circles. The downside of these small changes is very often that they are not sustainable due to the reversibility of the improvements. A greater impact can only be achieved through process improvement or process redesign.
An insurance company in Singapore that faces multiple complaints every day about long waiting times is looking for ways to increase customer satisfaction and hopefully the number of renewals of a certain insurance plan without increasing the headcount. This seems impossible as the team is already overloaded, turnover is high and morale is very low. However, the CEO is eager to try something new: Lean Six Sigma. After analyzing the process using simple tools like Value-Stream-Mapping, the team discovers some very interesting ideas:
1. Customers wait up to three weeks for their renewal despite the fact that the actual renewal generally takes only 15 minutes.
2. The renewal team spends a significant amount of time on nonessential activities, such as answering calls from customers who don’t understand the confusing renewal notice.
3. “Old habits” prevent the process from running smoothly. Some team members, for example, bundle their work, meaning they wait until Friday to work through a certain stack of customer requests. Some team members are very busy, others are not. They work in different customer segments and therefore “can’t” help each other.
It doesn’t take long for the process stakeholder team to come up with simple but powerful suggestions for improvement:
1. Reinvent the renewal notice with the customer in mind.
2. Redesign the process by minimizing secondary activities and focusing on value-added steps.
3. Increased workforce flexibility through cross-training and job redesign, as well as incentives for staff willing to “upgrade” their skills.
A year later, the same staff can handle a 35% increase in volume through a higher renewal rate. As a side effect, by leading this improvement effort, the team leader has gained enough self-confidence to be promoted to the management team.
Conclution
Increased productivity can be achieved in multiple ways. The myth of implementing IT support as a panacea for productivity problems has been proven wrong. Sometimes IT is used to speed up broken processes … to generate the same old problems, but faster. Focusing on the process, rethinking the way work is done, redesigning and improving the flow of activities in all kinds of functions will likely produce results. As a side effect, it will contribute to staff development and leadership strengthening.