"Productivity Marketing Campaign"
The Productivity Challenge Productivity Alberta Collaboration Innovation Transformation Lori Schmidt CEO Productivity Alberta www.productivityalberta.ca www.productivityalberta.ca 2 E-Scan Summary (Global) • Stagnant global economy • Fragile state of the European debt crisis • Credit market tightening (globally) • Stable political environment (Canada/Alberta) • Unstable Middle East • Growing environmental pressures • Social media hottest trend • Productivity issue heightened in discussion in national agendas www.productivityalberta.ca 3 At the regional/company level Companies are facing many challenges in their day to day operations: • Engaging employees from a wide range of generations • Shortage of skilled workers • High turnover rates • Too busy working in the business to focus on the business – margins slipping • High costs of shipping goods in and out of the region • Lack of resources to invest in technology • Increasing competition • Quality and safety concerns All these factors impact our ability to compete and to be productive www.productivityalberta.ca 4 Where we started… • Began at a local level • Networks identified similar issues • Explored the opportunity to collaborate on regional/local issues • A key challenge of productivity and overall competiveness emerged as a consistent theme www.productivityalberta.ca 5 What is productivity? Productivity is the measure of output for one unit of input Productivity is about using all of our valuable resources in the most efficient and effective way possible – our people resources; our natural resources; and our knowledge resources It is a measure of a jurisdiction’s prosperity and competitiveness www.productivityalberta.ca 6 What is productivity? Productivity = resourcefulness It’s the means to extend the resourcefulness of your business It’s about unleashing the potential of people, resources, and time that are already in your control It’s about doing more with what you currently have It’s about working SMARTER – not harder www.productivityalberta.ca 7 Productivity Is NOT Necessarily About… Downsizing Eliminating jobs Replacing people with machines Short-term improvements Cost-cutting initiatives Productivity Is Actually About… Meeting customer needs Making work more satisfying for all Increasing profits Using less effort, space, equipment, time Engaging and empowering workforce www.productivityalberta.ca 8 What the experts think “There are few issues that evoke a blank stare more than productivity. Upon hearing the word, people either react with lack of interest or recoil in fear that what is coming is a lecture on working harder. The result is an absence of any serious public discourse in Canada about productivity.” Kevin Lynch, Globe and Mail – January, 26 2010 “Some of the ways to accomplish [an increase in productivity] include employing more workers – which will be next to impossible with an aging population – or giving the existing workforce better tools to generate more production” Mark Carney, Governor, Bank of Canada www.productivityalberta.ca 9 Economic Well-Being and Productivity Measures of Standard of Living and Productivity GDP/capita, GDP/employee, GDP/hour worked. International Rankings in 2010 GDP/capita GDP/employee GDP/hour France 9 5 4 Germany 6 8 5 Ireland 5 3 3 Italy 10 9 9 Norway 1 1 1 U.K. 7 6 6 Canada 4 7 8 U.S.A 2 2 2 Australia 3 4 7 Japan 8 10 10 Source: Groningen Growth & Development Centre and Conference Board Ratio employment to population: lowest in France/Ireland; highest in Norway. Hours/worker: lowest in Norway; highest in Ireland. www.productivityalberta.ca The US - Canada Productivity Gap www.productivityalberta.ca Labour Productivity Why is it so hard to compare productivity levels? • GDP is estimated and defined differently across jurisdictions, e.g. treatment of software purchases. • Hard to estimate output/productivity in service sectors – often input based, especially in the public sector. • Different industrial structures, e.g. Alberta is O&G based and Ontario manufacturing based. • Methodological differences in estimation of employment, hours worked and physical capital. • For international comparisons, GDP estimates have to be adjusted for price levels (e.g. Purchasing Power Parity) – largest problem. • Comparison should be limited to jurisdictions with similar industrial structures. www.productivityalberta.ca Total Economy Productivity of Labour - 2010 Real GDP per Hour Worked, in 2002 constant dollars $/hour Source: Statistics Canada – GDP at basic prices www.productivityalberta.ca Total Economy Labour Productivity Growth Rates 2000 – 2010 (Based on Hours Worked) Annual Average Percent Change Source: Statistics Canada and Alberta Treasury Board & Enterprise – basic prices www.productivityalberta.ca Market Economy -Multi Factor Productivity Growth Rates 2000 – 2010 Annual Average Percent Change Source: Centre for the Study of Living Standards www.productivityalberta.ca Productivity conceptual policy framework Labour Effort Prosperity = Population Labour Force X Productivity GDP/Capita Intensity Profile Utilization Sources of Value Added Efficiency Gains Productivity Growth Skilled Scientific & Innovation Investment Competition Business & Workers & Engineering in Capital: Policy Environment Drivers of Management Talent ICT & Productivity Machinery & Trade Equipment ‘Population profile’ is the proportion of the population which is of working age and available to contribute to the production of goods and services. ‘Labor force utilization’ measures employment in the working age population. ‘Intensity’ looks at the hours per worker, or total hours worked by the engaged working age population. Source: Path to the 2020 Prosperity Agenda - Task Force on Competitiveness, Productivity and Economic Progress www.productivityalberta.ca Who is Productivity Alberta? Who we exist to serve: •Established small- and medium-size enterprises (SME’s) in Alberta •10 – 250 employees (typically) Industrial products and services (i.e. manufacturing, construction, mining, forestry, logistics, energy products and services •Future is beyond Alberta through collaboration and partnerships www.productivityalberta.ca 6 Productivity Alberta – mission and purpose Need: Improved productivity to enhance their competitiveness and sustainable profitability. Value Proposition: • Objective, ongoing diagnosis, guidance and advice • Client centered connections to quality resources; tools and programs • Leading expertise in improving clients’ productivity and competitiveness • Cost effective accessible solutions • Demonstrated return on investment • Streamlined approach to accessing products and services • A wide range of programs and service delivery options www.productivityalberta.ca 7 www.productivityalberta.ca Our Approach www.productivityalberta.ca Areas of Focus www.productivityalberta.ca 10 Productivity Is… Driven by Leadership and Management Strong leadership and a Leaders and managers visit the relentless commitment to shop floor daily to see first hand continuous improvement Leadership & areas for improvement. are essential. Management Leaders and managers must build and nurture trusting relationships with Innovation employees, suppliers and customers. Operations Leaders and managers must inspire innovation. www.productivityalberta.ca 21 Productivity Requires…Company-Wide Innovation Innovation generates the Leadership & ideas that allow us to Management continually improve. Innovation comes from our employees, from our Innovation suppliers, and from our customers. Operations Even small ideas can have a huge impact on our productivity. www.productivityalberta.ca 22 Six Kinds of Innovation • Meeting a need in the marketplace where no solutions exist Reconfigure the nature of how • Adapting your product for use in business is framed to serve the • Product creation/development • a new market customer: with a new core technology Market • make it easier to do business • Next/new generation, Extension • create more integrated products breakthrough/discontinuous and services technology • devise better ways to be profitable Technology Business Models • use resources in a new way Invention Re-Invent Innovation Improvements to products Product Process in ways that allow Make processes: Improvement/ Improvement • simpler companies to: Integration • faster • be more competitive • create new value to the customer System Solutions • more accurate • more reliable • increase productivity • Rethinking & integrating • less expensive existing systems • more integrated • Generating new systems to solve existing problems www.productivityalberta.ca These are considered of equal value 23 Productivity Is…Focused on Operations Leadership & Our operations are the Management target for continuous improvement. There is non-value added waste everywhere in our operations. Innovation Engage all employees to Operations find ways to improve productivity. Encourage experimentation and www.productivityalberta.ca 24 incremental change. How we provide services www.productivityalberta.ca Begin Your Productivity Journey STEP 1 Measure Your Organization Use our Productivity Assessment Tool (PAT) to critically analyze your business www.productivityalberta.ca 26 www.productivityalberta.ca 27 www.productivityalberta.ca 28 Begin Your Productivity Journey Step 2 Speak with a Team Member Once you’ve completed the tool, PA will help with analyzing the results and walk you through your next steps www.productivityalberta.ca 29 Begin Your Productivity Journey Step 3 Develop Your Plan Develop an Action Plan and access the programs and services specific to your organization’s needs www.productivityalberta.ca 30 Begin Your Productivity Journey Step 4 Put Your Plan in Motion Now that you have developed your plan, it is time to put it into action www.productivityalberta.ca 31 New program initiatives • Expand delivery options – Webinars – Online resources • Energy Efficiency Toolkit for example – Take away materials • Expanding partnerships www.productivityalberta.ca 32 For More – Visit Us Visit the Productivity Alberta web portal productivityalberta.ca Call us at 780 784-6000 Follow us on Twitter @ProductivityAB Join us on Linked.In www.productivityalberta.ca