Why the productivity promised land is still somewhere over the rainbow

Profile picture for user jmilne By Janine Milne April 30, 2018
Josh Bersin discusses the productivity conundrum and the need for new business and career models in part 2 of his interview with diginomica.

Wizard of Oz
Somewhere over the rainbow...

Workers have so many amazing workplace software tools to save time, cut admin and increase collaboration. So why do productivity levels remain so low?

So far, the promised land of productivity improvements appear tantalizingly out of reach, according to Josh Bersin, principal of Bersin by Deloitte:

Right now, every company I talk to is throwing everything against the wall to ty and figure out what’s going to make people more productive. Free food, exercise classes, thing to help people turn off their computers, email policies, letting people take Fridays off…whatever they can do to try and figure out what will make people more productive.

Meanwhile, software vendors are busy dreaming up more tools that will help us organize our work life and be more productive.  But Bersin’s gut feel is that we will have a few more years of struggle before we begin to make real progress on solving the productivity conundrum:

What I think will eventually improve productivity is not the workplace and tools but the business models. I think that’s one of the reasons companies feel unproductive and economic productivity is low.

By business models, Bersin is referring to digital transformation and the fundamental changes this brings to the way organizations operate in terms of people, structure, collaboration and leadership:

Most companies are going through a business model disruption…They have a lot of people in the wrong jobs and they haven’t figured out how to become more productive.

If you look at companies like Amazon and Google or companies that have really digitized themselves, their revenue per employee is huge, because they designed the company around a business model that’s exactly the right one for today.

Promised land

So the promised land of digital transformation is productivity. But only if it’s done right, says Bersin:

If you’re not getting productivity out of your digital transformation, then you didn’t transform yourselves in the right direction. Some companies think digital transformation is buying more software and buying more apps and that’s not true.

Many companies are still mid-transformation or still experimenting. And then of course there may be outside factors that will require a change of thinking again, says Bersin:

I think we’ll probably come out of this about the time there’s some form of economic slowdown, because we’re long in the tooth in this economic cycle.

Interestingly, Deloitte’s 2018 Human Capital Trends report highlights a big discrepancy between personal and business productivity.  While 71% of the 11,00 business and HR respondents think that new software tools would improve their personal productivity, 47% are worried whether they tools really drove productivity overall. Bersin says:

We have this weird thing where people are really enamored with the tools they have, but they also believe the organization is not using the tool well.

Bersin believes that ironically this is side-effect of vendors trying to make work software more consumer-like, engaging and fun to use. But the missing jigsaw piece is productivity:

It makes sense to me, because a lot of these tools were developed around advertising models and engaging people, so we actually now want people to be a little less engaged – we just want them to be able to get their work done!...We’ve got you engaged, now how do we get you disengaged?”

As well as business models, career models also need to change, reflecting the fact that post-digital transformation, organizations tend to have flatter less hierarchical structures and people move employers more frequently.

Careers are now a series of developmental experiences for multiple companies rather than moving up the job ladder in one company. Employees are as likely to move sideways in a company rather than up the corporate ladder. Bersin adds:

You used to have career models where you stay in this job for five years, and this for five years and this for five years and then you’ll become a general manager if you’re well rated. That’s too slow now. Companies are realising that by the time that 15 year-period happens half the pipeline will have left or gone in other directions or maybe the characteristics we needed aren’t the same.

So there’s much more of a model of putting people into more senior roles early and letting them learn how to be a more senior leader actually in the role and supported thing as opposed to waiting until they are ready.

Many leaders today, however, are older workers, who worked their way to the top through the old business model. So it’s not surprising that the ageing workforce is another key issue in this year’s report.

On one hand, 20% of respondents view older worker as a competitive disadvantage and 15% of respondents say that older works are “an impediment to rising talent”.

On the other hand, 80% of US employers see 50+ workers as a “valuable resource for training and mentoring” as well as having a wealth of useful knowledge and wisdom.  Bersin says:

Longevity is going up and there’s all sorts of evidence showing most people don’t want to retire and that they are healthier when they don’t retire.

Companies are working on how best to use older workers and to invest in them, while allowing for new talent to rise through the ranks without hitting a bottleneck.

There’s plenty of Artificial Intelligence (AI) and analytics tools out there to help companies figure out the kind of people they need, with the right kind of experiences and skills.

All this extra information about employees through AI and analytics is very powerful, but there are increasing questions about how this data should be used that companies will need to grapple with. According to Bersin:

The world has got a lot more capable at collecting data, but not at knowing what to do with it and the risk of collecting it. So a growing concern is, now we have all this data about our employees – their job, their activity, their email activity, how many hours they work, how much travel they’re doing, their performance rating and feedback – are we allowed to use all that data to decide who’s going to get promoted?

Do we need to tell them how we’re going to use that data? Do we have to ask them for permission? Do we have good governance of that data? Is it accurate? That’s a really big growing trend that wasn’t really there last year.

My take

What’s striking about this year’s list of 10 trends is that technology is not the focus. With the exceptions of AI and automation and people data, the concerns really focus on the effect of digital transformation. So it’s things like careers, leadership and the CEO role that are important.