Pro­duc­tiv­i­ty­i­saworth­while chal­lenge­tomeet­head-on

Belfast Telegraph - Business Telegraph - - News - Bylisam­c­caul, Ul­ster­bank @lilylisab Lisa Mc­caul is busi­ness growth en­abler at Ul­ster Bank

Pro­duc­tiv­ity is im­por­tant for all small busi­nesses — but it doesn’t quite mean what most peo­ple think it does. Rather than just do­ing more, the puz­zle of pro­duc­tiv­ity is es­sen­tially how to in­crease the out­put per hour of all the pieces of your busi­ness.

Whether that’s peo­ple, places or as­sets, pro­duc­tiv­ity is be­ing able to pro­duce more from the same amount of ef­fort, or re­move costs from your busi­ness while keep­ing qual­ity and out­puts high.

No sec­tor has to grap­ple with this quite like North­ern Ire­land’s agri-busi­nesses, with its unique ex­po­sure to global trends in com­mod­ity prices, ever-chang­ing cus­tomer demand for dif­fer­ent food prod­ucts as well as the im­pacts of our weather!

The ben­e­fits are clear — a busi­ness that im­proves pro­duc­tiv­ity will not only be able to im­prove their mar­gins and prof­itabil­ity, but they can also build a more sus­tain­able busi­ness that has a more resilient supply chain.

It can also free up re­sources to look at new mar­kets or prod­ucts that you could de­velop. And in the agri-sec­tor, there are also real ben­e­fits for the en­vi­ron­ment from this ap­proach — lower lev­els of in­puts can im­prove wa­ter qual­ity and other emis­sions.

So how can those in other sec­tors learn from the way agriculture tack­les the pro­duc­tiv­ity chal­lenge? Well, first and fore­most, a good con­trol of costs is es­sen­tial.

You can change two things to im­prove pro­duc­tiv­ity — ei­ther the amount or qual­ity be­ing pro­duced, or the amount needed to pro­duce it. And while the former might re­quire some plan­ning or re­search to achieve, con­trol­ling the lat­ter should be your bread and but­ter.

As such, mea­sure­ment is vi­tal. Agri-busi­ness is very suited to this — after all, it’s easy to count sheep, or how many eggs you are pro­duc­ing, but in the ser­vices sec­tor it’s im­por­tant to try and put a value on your time, and the time of your staff, to make sure that it’s be­ing spent wisely.

It’s also about con­sid­er­ing in­vest­ment care­fully. One of the most im­por­tant driv­ers of agri-pro­duc­tiv­ity isn’t ma­chin­ery or equip­ment — it’s the qual­ity of the soil and grass that’s pro­duced.

Yet this is some­times over­looked. Big show­piece in­vest­ments might im­press staff or clients in the short-term, but smaller, mar­ginal in­vest­ments could have an out­sized im­pact.

North­ern Ire­land does have a pro­duc­tiv­ity prob­lem — more peo­ple are in work than be­fore, but the amount that they are pro­duc­ing for busi­nesses is flat.

Solv­ing this prob­lem, par­tic­u­larly at an SME level, could help in­crease com­pet­i­tive­ness that cre­ates jobs and op­por­tu­ni­ties right across the board.

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