I've lost count of the number of commentators during this budget week in the UK that have said that although the economy is leading the work growth wise, we need to increase productivity if that benefit is to filter through to the general public.
During the last three recessions that I remember, we have fought our way out by working harder. From the early eighties I recall that each time expectations about what a day meant in terms of work went up, the pressure and activity levels each time increases and became the new normal. We made sure our living standards could at first be maintained and then improved by working harder. Technology helped in that it made us always accessible first from mobile phones then to email on the go. But fundamentally, it still came down to people doing more.
I’m not sure that's possible this time. The people I come across are working as hard and long as it's physically and mentally possible to do. It's no coincidence that the growth that we've seen in the last few years has seen an even bigger creation of new jobs. It's not the existing staff that are driving the economy upward, it's the new people. Trouble with that is that it doesn't allow wages and salaries to increase, in fact the opposite. I'd contend that having two people, at least in administration roles does not equal twice the productivity. The communication overhead at best means 1.8 and more likely initially 1.5.
So with a major change to the cost of employment this week with the updating of the minimum wage to the living wage, how will business cope, especially those that compete internationally? Although the legal measures only mandate the bottom levels it's fooling ourselves to think that the levels about are not going to demand the differential is maintained.
So my best guess is that this is the UK government taking the view that short term pain is required to force companies to address their productivity. I suspect their idea is that a few companies going to the wall is acceptable if we can transform most into world class players.
So how is that transformation going to happen? Well if you’re reading this then you’re on the road already, because you understand the importance of having systems that do the work for you and leave you to make the decisions. Solutions like Microsoft Dynamics don't drive productivity on their own but are the tools that enable people and companies to do so.
It's the motivation and desire to question what they do that starts the process. Dynamics has the flexibility to deliver and enable those new processes. If you’ve got the kahunas to not accept the status quo and drive that change, Dynamics and good consulting will deliver the required results.