Why Businesses Are Spending More Than Ever On Workplace Culture, Yet Productivity Is At An All Time Low

As reported by Future Market Insights, $63.6B is spent every year to create higher performing workplaces, yet businesses still lose $8.8T a year in lost productivity. The solutions being deployed aren’t working – but why?

There are so many reasons, but from the work we do, we usually see an overarching cause of high workplace spend, but low productivity impact: businesses don’t know their people well enough, to implement solutions that really impact individual productivity, performance & engagement.

A three-part problem

If you’re looking to increase productivity in your business, you can’t just look at productivity. You also have to look at how engaged your employees are, and whether they are able to perform at their best at work.

In addition to the average employee only being productive for less than 3 hours a day, Gallup’s latest stats also show that only 23% of employees are engaged at work, and only 35% of employees are able to perform at their best at work.

The three challenges are intrinsically linked – happy, engaged employees are more productive; productive employees perform better; and when able to perform at their best, in-line with their strengths, employees are more engaged and more productive.

Despite the link, many businesses tackle the problems individually through things like engagement surveys, management training, time tracking, and a myriad of other people initiatives. But these done in isolation very rarely make any real impact in the long term on increasing productivity.

So what is the solution?

Get to know your people on a behavioural level. What motivates and drives them? What environment and resources do they need to perform at their best? Where are they most productive? How do they need to be communicated with for maximum impact?

Unless you know what behavioural skews you have in your business, and then deploy solutions that are tailored to those behavioural needs, you will struggle to do more than scratch the surface when it comes to increasing engagement, performance, and productivity.

Examples:

• Karen's Situation: Karen is procedural and detail in nature. She works at her best in a quiet environment without too many distractions. The company she works for has an open plan office and no work from home options. They are growing quickly so lack process and operational standards. Her manager doesn’t like detail so often fast balls her in the middle of the day with a conceptual outline of a new priority. She tries to compensate for the lack of structure by working longer and harder but becomes burned out. The company runs lots of social events and spends a lot of money on making the office a more collaborative space. None of these things are what Karen needs to be productive or engaged. She simply needs an option to work from a quiet space for half her working week, and more process in how she executes her role.
• Matt's Situation: Matt is a Sales Exec at a growing Tech company. He is highly achievement motivated and a driver of action. Until last year he was one of the highest performers, managed through clear targets and goals, and reported directly to a fast-paced Sales Director. He regularly was recognised in the company's all-hands call on a Friday and his career path in the business was clear. The business brought in a new CCO who believes in team targets versus individual ones and changed the “all hands” to quarterly recognition instead of weekly. Matt’s productivity dropped. With a lack of regular recognition and no personal targets to strive for, his motivation and engagement were low and he wasn’t able to perform at his best.

In the above two examples you’ll see the greater impact that leaders understanding their people have on productivity, and then HR teams deploying initiatives based on behavioural skews in the business, versus broad brush cultural incentives.

Ask yourself – do you know what motivates your team? What drives them? What environment they work most productively in? Where they perform at their best? And then, does how you manage them and your workplace culture match that?