White-Collar Productivity

Productivity of white-collar worker is no less important than that of direct labor or manufacturing employees. Indeed, in terms of numbers and expense, non-production employees outnumber production employees by a wide margin. Yet the problem of measurement  of output is more elusive. Measuring the units assembled per man-hour is not too difficult, but how many reports should an accountant prepare, not to mention the most difficult of all measure–managerial productivity.
Research has shown that white-collar employees are productive only about 50 percent of the time. The remainder is non-productive time and can be traced to personal delays (15 percent) and improper management (35 percent). Cause of wasted time includes:

1.                   Poor scheduling

2.                  Slack start and quit times

3.                  Lack of communication between functions

4.                  Information overload

5.                  Poor staffing

6.                  Inadequate communication of assignments

7.                  Unproductive meetings and telephone conversations

 
Measuring the Service Activity

Although the manufacturing worker (one who physically alters the product) has been measured for decades by time standards, time studies, and work sampling, it is not easy to set standards for the non-manufacturing employee or the service activity. It is unlikely that measurement can be achieved in the same way as is done for the manufacturing worker. Nevertheless, a system can be devised to describe the productivity of an activity at a point in time and then provide a baseline for judging continuous improvement over time. The system is particularly appropriate for multi-plant or multi-divisional companies with similar products or services and for individual companies within an industry.
The basis for a system of measurement starts with the existing functions and activities of the organization. Each activity is a subset of a particular function. For example, the activity of recruiting is a part of the human resource function; accounts receivable is a part of the accounting function, and so on. The typical organization may identify a hundred or more activities that can be grouped into ten or more functions.
The next step is to identify the output indicators that “drive” the activities or cause work in the activities. In other words, if it were not for the work caused by or resulting from indicators, there would be little need for the activities. If for example, there were no personnel employed, there would be no need for employee relations. If there were no purchasing, there would be no need for vendor invoicing. The resources utilized in the activity of vendor involving are therefore a dependent variable of the purchasing function. In other words, if activities are “input” in the productivity ration of out put to input, then the indicators are the “output.”

Kaizen

Kaizen is a Japanese word. It is basically composed of two words “KAI” means change and “ZEN” means better. In other words it means change for betterment or improvement.
Kaizen is a philosophy that defines management’s role in continuously encouraging and implementing small improvements involving everyone. It is the process of continuous improvement in small increments that make the process more efficient, effective, under control, and adaptable.
Improvements are usually accomplished at little or no expense, without sophisticated techniques or expensive equipments. It focuses on simplification by breaking down complex processes into their sub-processes and then improving them.
The Kaizen improvement focuses on the use of:

1.                   Value-added and non-value-added work activities.

2.                  Muda, which refers to seven classes of waste-overproduction, delay, transportation, processing, inventory, wasted     motion, and defective parts.

3.                  Principles of motion study and use of cell technology.

4.                  Principles of material handling and use of one-piece flow.

5.                  Documentation of standard operating procedures.

6.                  The five S’s for workplace organization. (Already explained in Lean Production Post)

7.                  Visual management by means of visual displays that everyone in the plant can use for better communications.

8.                  Just-in-time principles to produce only the units in the right quantities, at the right time, and with right resources.

9.                  Poka-yoke to prevent or detect errors.

10.               Team dynamics, which include problem solving, communication skills, and conflict resolution.

Kaizen relies heavily on a culture that encourages suggestions by operators who continually try to incrementally improve their job or process.

Social Media – Engaging Customers

Now a day’s social media is fast becoming an important part of brand’s marketing plan. Today, many companies are using social networking to gain credibility, foster employee relationship, build forum for communication with customers and finally boost the sales.

90% companies are using social networking media for their brands and organizations. The survey brought that 42% brands/organizations spend more than 10 hours per week on their social media programs. Nearly 80% of the social media programs are led by the marketing department of brands/organization, while 78% of social media programs are B2C in orientation, followed by B2B adoption of 41% and Partners & Employees use 26%. Marketing is the area where social media is being used the most; followed by online reputation management/online PR. Lead generation happens to be third category for which companies use social media in India.

Some vital statistics, Purposes brand/organizations use social media are as follows:

1.       Competitive intelligence – 41%

2.      Customer service – 44%

3.      E-commerce – 18%

4.      Enterprise collaboration – 13%

5.      Lead generation – 48%

6.      Listening and analytics – 44%

7.      Marketing – 78%

8.      Online reputation management/Online PR – 71%

9.      Product ideas and development – 30%

10.   Recruitment – 24%

11.    Social CRM – 28%

12.   Thought Leadership – 43% (Source: Dataquest)
Overall, social media is becoming an important part of a brand’s marketing plan and cannot be avoided by brands and organizations any more.

Company Structure

For long term sustainability of any company, basic 4 pillars are as follows:

1. Corporate Governance:

The company strives to maintain size, diversity and independence of the directors. The company must show that it has a long-term commitment for maintaining an efficiently functioning board with an appropriate size or a mostly independent board or diverse board (international, intercultural, female representation, industry experience, financial expertise, age, or size of board). The compensation of the management and board of directors is linked to financial and extra-financial targets. The company must show that there is a system, policy or code of conduct in place that the remuneration package attracts and retains experienced management and board members. The company has a general, long-term commitment to an effective board and board committees with allocated tasks and responsibilities that can be fulfill through regular board meeting attendance. The company must show that it has a general, long-term commitment to ensure equal rights for minority shareholders like the exercise of the voting right in absentia and the timely access of shareholders to information, or the right to ask questions and make proposals.

2. Economic:

The company strives to generate sustainable and long-term growth, while maintaining a loyal client base and preventing anti-competitive behavior. The company pursues a long term policy that builds on employee loyalty and productivity, which in return improves its margins, to maintain a loyal shareholder base by delivering strong short and long term financial results, and transparent communication policy.

3. Social:

 The company shows a long-term commitment towards high employee remuneration like salaries, compensation payment, profit-sharing, rewards, performance benefits, employee stock purchase plans, insurances like Health insurances, Life-insurance, Pension funds, Accident insurances, General commitment towards the importance of health and safety of employees, it has a long-term, general commitment towards training and development of its employees. The company shows that employee training is important for the company. The company shows a long-term commitment towards good work-life balance for its employees, offering flexible working hours, vacations, and maternity leave without negative effects for their career, Human rights, and the Freedom of Association are part of the company's Business Code.

4. Environmental:

The company strives to make an efficient use of natural resources (example: materials, energy or water), shows a commitment towards reducing its environmental emission, has a long-term commitment towards environmental efficient product or service innovation.

Business Opportunities – Africa

As corporate India slowly wades into Africa, it discovers a continent full of opportunities. This is the new frontier for global businesses and Indian companies are not to be left behind in the gold rush to prime their growth and resources to fire their factories. Indian companies, be they in Information Technology, pharmaceuticals, telecom, retail, infrastructure, see Africa as a pot of gold at the end of the rainbow.

 The size of the African opportunity is astounding, a continent of 53 countries (now south Sudan comes into existence i.e. 54 countries), and a population over the billion people.  According to the World Bank, Africa has $860 billion worth of consumer spending. According to the Mckinsey Global Institute, Africa’s GDP will be around $ 2.6 trillion in 2020.

A big chunk of that growth will come from mining natural resources from the oil wells in Sudan and the copper mines in Congo, to Uranium in Niger, coal in Mozambique and ferro - chrome in S. Africa. According to Mckinsey, almost a Quarter of economic activity in the 15 countries that make for 85% of Africa’s GDP, is accounted for by resources.

Some facts and figures show that Africa is erupting in perspective of business growth:

1.       At 4.9% compound annual growth rate of its GDP, Africa is third fastest growing region.                                                       ( Source: World Development Indicators, IMF)

2.      By 2020, Africa’s Consumer spending will be $ 1.4 trillion and collective GDP will be $ 2.6 trillion.

3.      By 2025, around 47% of Africans will be living in cities.

4.      Mobile phone users/subscribers are 37%.

5.      Africa possesses about 60% of the potential available cropland in the world.                                                                            ( Source: E & Y)