Perceived drivers of labour productivity in organisations

Abstract

Productivity is one of the strategic areas in which \norganisations seek to achieve long-term prosperity. It has \nbeen argued that firms that can improve the input-output \nrelationship would improve their profitability (Pearce and \nRobinson, 2003). According to the Organisation for \nEconomic Co-Operation and Development –OECD (2001), \nthere is not a single exhaustive definition of productivity. \nTheir objectives of productivity measurement include \ntechnology, efficiency, real cost savings, benchmarking \nproduction processes, and living standards. The focus of \nthis research project was not on how to generate growth in \nlabour productivity but rather the factors that influence \nlabour productivity. Therefore, the research project \naddressed the following objectives: \n• Identifying the distinct set of labour productivity \ndrivers for an organisation. \n• Determining the order of importance of the \nidentified labour productivity drivers for the \norganisation. \n• Identifying if there were any interdependencies \namong the identified drivers of labour productivity. \nThe literature review was based on research done on Total \nFactor productivity (that is overall labour productivity), \nLeadership, Performance Management, Training and \nDevelopment, Market Competition, Continuous \nImprovement, and Socio –Economic conditions. Based on \nthe assertions that were been formulated in the literature \nreview, and in conjunction with the research project \nobjectives, the following research hypothesis was derived: \nThere are factors that influence labour \nproductivity, in addition to inputs and outputs of an \norganisation. \nQuantitative research was done through a questionnaire. \nThe population for the research project were the \nemployees of Astrapak. A balance among variability, \nprecision, and confidence level was considered in \ndetermining the sample size (Diamontopoulos and \nSchlegelmilch, 2006). Using stratified sampling, surveys \nwere sent to Astrapak employees within the three \noperating divisions (Rigids, Films, and Flexibles) and \nacross the geographical regions of (Gauteng , KwazuluNatal , Western, and Eastern Cape. 143 surveys \nquestionnaires were sent out. 59 questionnaires were \ncompleted and sent back, representing 41% of the total \nsurveys sent out. Based on a population size of 3000 and \nthe 143 questionnaires sent, and the success rate of 41%, \nthe sampling error was approximated as 7.8%. \nBased on the substantive significance of the labour \nproductivity drivers results, it was concluded that the \nfactors of labour productivity, on which the research project \nwas based, were substantially significant (at a 95% \nconfidence level) to overall labour productivity. The \nstatistical analysis results were that there were no \nsignificant relationships between overall labour productivity \nand the respective productivity factors. Substantive \nsignificance takes precedence over statistical significance, \nsince the substance of the results has implications for \ntheory, practice or policy (Diamantopoulos and \nSchlegelmilch, 2005). \nThe top three labour productivity factors were motivation \n(Leadership category), continuous improvement \n(Continuous improvement category), and employee \nperformance (Performance Management category). \nThe results of the analysis of the Pearson correlations \namong the productivity factors was that only 98 (24%) of \nthe Pearson correlation coefficients were statistically \nsignificant. Even though the type and quantity of labour \nproductivity factors may be different, the survey results \nindicated that there might be interactions among the labour \nproductivity drivers. Therefore, the interactions among the \nlabour productivity drivers may not be ignored in evaluating \nthe effect of labour productivity drivers on overall labour \nproductivity. \nThe research project on labour productivity drivers was not \nexhaustive of all labour productivity drivers. Therefore, the \nopinions of the respondents on other factors that they \nconsidered important were also captured in the survey. \nThe top three factors that respondents considered \nimportant but which were not explicitly covered in the \nquestionnaire were teamwork, communication, and \ncompany strategy and objectives respectively. \nIt was recommended that the research study be done on a \nproject basis within the Astrapak group of companies. The \nproject would be focused on implementing the research \nfindings of the study. One company would be used as an \nexperiment group and the other companies would be the \ncontrol group. Doing the survey, at both the experimental \nand control groups would guide the evaluation of the \nchange in labour productivity.

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