Productivity performance of SMEs is the weakest link in the British Economy
The Public Sector and SMEs are the main two laggard sectors which have refused to become more Productive & efficient for the last decade.
Why are SMEs such laggards?
·SMEs invest relatively little in their Staff Training and for their Management.
· SMEs are relatively complacent, with less ambitious profit-improvement targets.
· Poor Management, Motivation and direction of staff.· Poor use & application of new technologies (NOT Expenditure).
· Inability to measure / record / target Productivity improvements.
· Poor collaboration amongst SMEs to cooperate, work together and learn from one another.
· Few SMEs understand the importance of Productivity, being the cornerstone of Profitability growth, only 1/3rd of SMEs even measure Productivity.
When it comes to working practices linked to Productivity, PRESENTEEISM – employees who are present, but not engaged in Productive work – and absenteeism are well-known causes of Productivity loss.
In a recent study British employers lost on average 27.5 days of productive time per employee each year, or more than 10%, which costs the UK economy £73 billion each year in lost productivity.
Despite its’ high cost, UK SMEs are the least likely employers in Europe to take measures to improve Presenteeism. Just 19% of UK SMEs have taken steps compared to 26% of German SMEs and 29% of French SMEs.