Despite geopolitical challenges on multiple fronts, the IMF predicts the world economy will grow by 3.3% this year; up from the 3.2% last year even though they warn ongoing service-related inflation means interest rates could remain higher for longer.
That said the US’ unusually high inflation rate of 7% hit in December 2023 (the highest since 1982) has dropped below 3% meaning the world’s biggest economy with a GDP of over $28 trillion is offsetting much of the global decline.
Curia’s latest business outlook survey in New Zealand suggests economic uncertainty has become the number 1 concern for executives here albeit the vast majority (82%) expect things to improve; the latter echoed by NZIER’s most recent survey of business opinion (QSBO).
Irrespective of limited growth opportunities, businesses can still achieve gains
Given the limited growth opportunities on the horizon, adopting technological advancements including AI in conjunction with a greater focus on achieving measurable improvements across core business functions should be the point of focus for executives this year.
As Gallup reminds us, the world’s workforce is becoming increasingly disillusioned – and subsequently less productive – costing employers billions of dollars in lost earnings every year.
However, lifting the performance or contribution of every person, even if only modestly, not only makes a difference to them, it can have a significant impact on an organisation’s profitability and future earnings.
Moreover, super-engaged employees not only deliver better outcomes at lower costs, they create opportunities for improvement wherever they go. If this becomes commonplace, it can transform an organisation’s prospects as well as its position in the market.
Astute leaders know the greatest assets in their business are their best performers. If high performance can be normalised across an organisation, it can turn otherwise unremarkable companies into industry leaders.
Interestingly, most believe this optimal state takes years to achieve when in fact, with the right leadership and tools to support it, it can be achieved in less than two.
So what’s needed to realise it?
1. A vision that means something to everyone; and
2. A mechanism to support the impact and effectiveness of every person
When embedded, these levers alone can generate an uplift in an organisation's performance and productivity turning it into the envy of every entity in that sector.
The fact is, any organisation can achieve productivity improvements because most of the people they employ would welcome a better experience and the opportunity to play a greater role in their company's future.
Despite the opportunity, high performance for the masses remains elusive
One reason organisations are struggling to lift their game is because they’ve focused on managing their people as a resource rather than empowering them to deliver the outcomes the business is after.
Such approaches destroy employee ingenuity and inventiveness and with it, their desire to succeed; whereas, inspired organisations that focus on lifting their people’s impact and effectiveness win on both fronts – customer satisfaction and employee engagement.
As our 30 years of research prove, no organisation can legislate its way to greatness and nor can it make its people successful. What leaders can do, however, is engage their people in their vision for the business so they understand what they need to deliver and then commit themselves to ensuring they achieve it.
If building a high-performing organisation that delivers on its promise to its stakeholders becomes the executives’ priority, it not only changes the culture of an organisation, it elevates each employee’s role in the company thereby giving them a reason to excel rather than simply doing a job that appears to make little difference to anyone.
As Jim Harter, Chief Scientist of Workplace Management and Wellbeing at Gallup points out, "Leaders should define what they want their culture to look like so they’re clear about how to align it with the organisation's purpose.” He stresses the importance of organisations selecting leaders who have the ability to inspire people which although vital, is a long-term play.
For this reason, we recommend organisations deploy proven tools like Vantaset at the same time to not only align every person’s role with the organisation’s vision but optimise their impact on a daily basis.
It’s important to note this is not about adopting feel-good practices that focus on people’s happiness or well-being. It is about building a progressive, high-performance culture that brings out the best in every person.
Based on our findings, we believe the majority of efforts undertaken to support people today do little to improve the productivity and competitiveness of the organisations that adopt them. Instead, they tend to produce paternalistic cultures that diminish the spirit of their employees and, as a result, the aspirations of their workforce as a whole.
At the end of the day, building a high-performing business can only be achieved when the executive make a concerted effort to not only connect people’s roles with the intent of the business, but institute practices that ensure their repeated and ongoing success. In other words, executives need to accept the performance of their staff is a consequence of their leadership rather than an indicator of their (people’s) capability.
Understanding the data
For those who follow employment data, they will know that staff engagement around the world continues to fall. Why this is the case remains a mystery to most otherwise we would be seeing a reversal given the amount of money organisations are investing in their people and workplaces in general.
Despite the unequivocal correlation between staff engagement and organisational success, very few organisations ever become true high performers. Instead, the best most can expect is the occasional ‘pocket of excellence’ brought on by individual leaders going above and beyond.
Qualifying performance
The ‘performance’ aspiration of every leader should be one hundred per cent of their staff aspiring to perform at their best 100% of the time - as opposed to the 3-5% typically experienced.
While most will say this is completely unrealistic, we believe it needs to be the target otherwise establishing appropriate performance-driven expectations is impossible. In other words, failing to set such an expectation is not only insulting to individuals, it undermines the importance of people’s roles to the organisation.
Unlike sport, businesses are not asking their people to 'destroy' themselves at work on a daily basis. Instead, they need them to be ‘on’ when they’re working otherwise the losses accumulate on a continuing basis. That said, it is vital performance expectations are agreed across the business rather than being foisted on staff without a benchmark or the knowledge of what is achievable.
Either way, employees are not the problem many would have us believe. Instead, the productivity issues we’re grappling with are a result of outdated practices being imposed on unsuspecting managers who have neither the skills nor insights to understand the constraints they cause; hence high-performing teams remain the anomaly as they are forced to work ‘outside’ the system.
