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How Can Organisations in Asia Use Analytics to Improve Workplace Productivity?

February 16, 2017

As regards to Asia Pacific, the catch-up phases in which productivity gains were easy to achieve with the introduction of technology, is gone. A new report from the Workforce Analytics Institute (WAI), a partnership between The Conference Board and Mercer, titled Employing Analytics to Enhance Workplace Productivity, states that raising employee productivity remains one of the key levers organizations can use to improve their competitiveness.

The report highlights the importance of prioritizing three key approaches and outlines strategies that organizations can use to enhance productivity: developing more effective leaders, leveraging technology and enhancing employee engagement.

Rising wage pressure, lack of skills to leverage technology, ineffective leadership and low engagement levels are making it difficult for firms to deliver productivity gains. Singapore and South Korea showed the largest drops in productivity per person with 3.12% and 2.34% respectively, compared to India, which had the highest gain at 2.71%, followed by Indonesia at 0.68%.

Siddarth Mehta, Leader, Workforce Planning and Analytics, Mercer, commented on the report, “Across Asia we are riddled with economies showing weak or slowing growth. Against this backdrop, productivity combined with rising wage pressure poses a serious threat to organizations’ profitability. Additionally, in Asia, where the demand for skilled labour far exceeds supply, companies in the region are encountering substantial difficulties: they are realizing that the link between productivity and business performance is one of an organization’s key resources and if effectively managed can lead to significant payoffs. Gone are the days when productivity could spike simply with the introduction of technology. Going forward, companies need to be more innovative.”

See: How Can Business Leaders Maintain Trust Across the Analytics Lifecycle?

The Conference Board’s research shows that the global decline in productivity growth is a serious threat to competiveness and profitability – from 2007 to 2014 productivity growth dropped about a quarter of what it was from 1999 to 2006 and is expected to make little recovery before 2025.

In Asia, most markets have seen a slump in labour productivity with nearly all markets, with the exception of India, Indonesia and Philippines, showing decreasing productivity between 2008-2016, when compared to 1999-2007 (Exhibit 1).

EXHIBIT 1: Growth of labor productivity per person employed, Asia

EXHIBIT 1: Growth of labor productivity per person employed, Asia

Raising productivity is fast becoming a priority and especially crucial in an uncertain business climate. The Conference Board’s research illustrates that higher productivity growth can be associated with larger real net operation surplus growth (Exhibit 2).

EXHIBIT 2: Total factor productivity growth can drive profits

EXHIBIT 2: Total factor productivity growth can drive profits

Drawing insights from interviews and surveys with over 50 HR professionals in Asia, three main themes emerged:

  • Developing leadership to drive productivity:Where significant changes to the work environment are planned, as is the case for most productivity interventions, communication, preparation and transparency is the key.
  • Enhancing employee engagement:Designing incentive schemes to motivate employees, or creating physical and virtual workplaces that promote teamwork, collaboration and engagement are ways to provide a healthy environment for high performance.
  • Leveraging technology to raise productivity:Technology is best utilized for communications, equipment upgrades, self-service systems and training.

According to Caitlin Pan, Ph.D., Senior Researcher, Asia Region of The Conference Board and an author of the report, “To foster a culture in which consistent productivity growth is possible, organizations need to develop a systematic approach toward tracking and analyzing the quality of their productivity interventions. We often see companies start a number of initiatives and continue to pursue them without a clear understanding of which, if any, has a positive impact on organizational outcomes including profitability.”

“Feedback is useful, but measuring and qualifying the quality of the interventions will lead to enhanced productivity. Before designing and implementing an intervention, it is imperative to determine the current productivity levels so as to effectively evaluate the changes in productivity.”

Also read: Hiring Tools – Psychometric Assessments Vs Predictive Analytics

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