Low take-up of high performance working is hindering UK productivity

UK manufacturing firms must seize the opportunity to promote widespread adoption of High Performance Working (HPW) if they are to maximise their productivity performance. This is a key conclusion of a study published today by the EEF, the manufacturers’ organisation, and people management experts, the Chartered Institute of Personnel & Development (CIPD).

The study ’Maximising Employee Potential and Business Performance - The Role of High Performance Working’ demonstrates how UK manufacturing companies that introduce HPW can expect to achieve a 20 per cent increase in productivity and profitability, and concludes that private sector service firms and public sector bodies could enjoy a similar boost to performance. However, the study highlights the challenges facing manufacturing firms and other organisations that want to introduce HPW.

HPW covers over 30 different progressive HR practices encompassing recruitment and selection, workplace learning, job design, staff appraisal and performance related reward. However, the application of these practices remains limited throughout UK industry and EEF and CIPD have produced the report in an attempt to highlight the opportunities for improving company performance and spreading best practice.

The EEF and the CIPD believe the challenges for firms wishing to introduce HPW successfully are multiple, requiring extensive training for managers and employees. It will also require sophisticated recruitment and selection procedures must also be put in place to ensure that future managers and employees can support a culture of HPW.

Furthermore, the chances of success of HPW can hinge on a strong and active commitment from senior management, commitment from employees to the organisation’s objectives, the opportunity for managers and employees to apply their own discretion in their work and the pursuit of continuous improvement throughout the company.

EEF Director General, Martin Temple, says:

The benefits of HPW are clear to see for manufacturing companies. By making a relatively small investment in tried and tested techniques they can make a substantial improvement to their performance. However, the benefits and techniques are not widely known which is why our report, produced jointly with the CIPD, is so timely.

The CIPD’s Chief Economist, Dr John Philpott, adds:

The EEF and the CIPD have together highlighted the ’implementation gap’ on HPW which underlies the UK’s productivity gap. There are no easy direct policy levers that the government can pull to close the gap. Indeed, the very nature of HPW implies that the best thing ministers can do is promote the cause of HPW but allow manufacturers and other private sector businesses the flexibility to adopt practices in ways that best suit their specific needs.

The EEF and the CIPD believe that the government needs to take a lead by encouraging greater use of HPW across the public sector. This would act as an important signal to private sector firms as well as helping to meet to the urgent policy goal of improving the quality of public services.