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02/09/2002
Short-termism reduces productivity says TUC report
According to a TUC report, mediocre management and short-term approaches are being blamed for dragging down productivity in the UK.
The report published today claims Britain’s management culture is holding back the government’s drive to boost productivity.
TUC General Secretary John Monks said: "High performance workplaces aren’t created overnight. Managers who want to create them have to invest simultaneously in a bundle of reforms of training, employee participation and work re-organisation. Then they have to wait for results - making all these changes takes time, and there’s often a gap between the changes being made and the response of the people they’re aimed at. These are long term reforms, and managers can rarely demonstrate to shareholders that they will pay off in the shorter timescale used for investment decisions."
Research quoted in the report includes a study of 200 British manufacturing firms which found that ‘low road’ work practices - short-term contracts, no employer commitment to job security and low levels of training - were significantly associated with poor performance.
Firms with high levels of turnover scored particularly badly on product and process innovation, and all the ‘low road’ practices (high turnover, temporary contracts and fixed term contracts) were linked to low labour productivity.
The TUC also cited a recent survey by the Institute of Management which found that over a third of all managers rate the quality of leadership in their organisations as 'poor'. Only one in a hundred rated it as 'high' and even CEOs were not impressed, often describing the quality of leadership as 'mediocre.'
Government figures in a recent survey revealed what workers thought of their managers’ skills. The survey found that between one quarter and one third of staff thought their managers were poor at dealing with work problems; keeping everyone up to date about proposed changes; responding to suggestions from employees; and providing everyone with a chance to comment on proposals.
A productivity study by the Engineering Employers’ Federation found that foreign-owned firms are more likely to introduce workplace innovations than UK-owned firms.
The difference between UK-owned firms and EU-owned was less clear-cut, but EU-owned firms were overall more likely to innovate.
(SP)
The report published today claims Britain’s management culture is holding back the government’s drive to boost productivity.
TUC General Secretary John Monks said: "High performance workplaces aren’t created overnight. Managers who want to create them have to invest simultaneously in a bundle of reforms of training, employee participation and work re-organisation. Then they have to wait for results - making all these changes takes time, and there’s often a gap between the changes being made and the response of the people they’re aimed at. These are long term reforms, and managers can rarely demonstrate to shareholders that they will pay off in the shorter timescale used for investment decisions."
Research quoted in the report includes a study of 200 British manufacturing firms which found that ‘low road’ work practices - short-term contracts, no employer commitment to job security and low levels of training - were significantly associated with poor performance.
Firms with high levels of turnover scored particularly badly on product and process innovation, and all the ‘low road’ practices (high turnover, temporary contracts and fixed term contracts) were linked to low labour productivity.
The TUC also cited a recent survey by the Institute of Management which found that over a third of all managers rate the quality of leadership in their organisations as 'poor'. Only one in a hundred rated it as 'high' and even CEOs were not impressed, often describing the quality of leadership as 'mediocre.'
Government figures in a recent survey revealed what workers thought of their managers’ skills. The survey found that between one quarter and one third of staff thought their managers were poor at dealing with work problems; keeping everyone up to date about proposed changes; responding to suggestions from employees; and providing everyone with a chance to comment on proposals.
A productivity study by the Engineering Employers’ Federation found that foreign-owned firms are more likely to introduce workplace innovations than UK-owned firms.
The difference between UK-owned firms and EU-owned was less clear-cut, but EU-owned firms were overall more likely to innovate.
(SP)
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