When productivity starts to slide, it’s not always easy to pinpoint the cause. Our first impulse is often to take a close look at how we can improve workplace processes. Is it a problem of time management? Could it be that the technology’s not up to the job?
Very often these are indeed the answers, but every once in a while, you see that all the traditional vital signs are in order. In these situations, I often found that the problem is more strategic because it relates to the choices firms are making about the kind of business they’re taking on — something I call “work mix.”
It’s a particular problem for service firms. Take for example the case of my recent client, an engineering consulting company I’ll call Astride. Its main work involves designing bridges, buildings, factories and houses. It has 96 staff working in offices in three small cities and is owned by four partners, three of whom head up an office each.
The partners were concerned about levels of staff productivity and performance relative to the competition. What could be the cause? I was called in to see if I could find out.
First up, I conducted a workshop, giving all staff the chance to address the issue and propose solutions. I also interviewed the partners and a cross section of employees to better understand the anchors on raising Astride’s productivity.
To be sure, some of the usual suspects made their bows. Interviewees complained of poor recognition for effort and a lack of clarity around individual career paths and possible progression through the firm. It was clear that the firm needed to make more investment in engineering design software. And there was a lot of improvement possible in terms of managing the workload across and between the offices.
But there was one unusual subject as well — a set of problems around the mix of consulting assignments that Astride was taking on. In firms like Astride, engagements can vary widely, ranging from figuring out the design of a construction component like a reinforced concrete slab to designing a whole bridge. Engagements at the bottom end of this range were described scathingly by some staff as “piss-ant jobs,” and there was a distinct feeling that Astride was taking on too many of them.
What makes a job too small? And what are the productivity effects of taking it on? It’s a tricky question because growth in professional service firms isn’t always smooth sailing. It involves a stepped process.
Let me demonstrate by looking beyond Astride. Think for a moment of other professional service firms. Let’s take accounting. Here we see a matching of firm size and client size — tantamount to a symbiotic relationship. The KPMG of today, for example, doesn’t aim to undertake the tax returns of individuals. Its focus is rather on large corporate and government work. It has built its organizational infrastructure accordingly.
But to get to this point it had to decide, one step change at a time, to let go of small clients while at the same time building the required corporate muscle for larger clients. This bootstrapping process comes with higher overhead costs at each stage. The gradual-growth-then-step-and-gradual-growth progress in professional service firms produced the KPMG we have today — a large multi-national accounting practice. But, and this is the tricky bit for senior managers, there’s no turning back. Having moved up that scale over time, it’s no longer economic to undertake the small jobs that have been left in the wake.
This is the very scenario that Astride’s partners are facing. In growing companies like this there comes a moment of truth when a management that’s used to taking on any business it can has to start picking and choosing. Thus far, I’m afraid to say, Astride’s partners are not grasping the nettle. But unless they do no amount of management training, technology upgrades, or workflow management will be enough to make up for the productivity losses that come from the “piss-ant jobs” they’re settling for.
So what should Astride be doing? I usually recommend companies like this to begin at the strategic level by looking at:
Strategic decisions. As with Astride, it could be that your major decisions — regarding the business you’re in, your target customer, and the work you need to specialize in for growth and economies of scale — is having a major impact on the ability of your staff to apply their skills effectively. So have a review of these decisions. Have you even consciously made them?
The decision-making structure. Partnerships, where each partner has an equal vote, are prone to indecision. Some managers want to grow, some don’t. Some want to move to larger jobs letting go the smaller ones, others are concerned about a possible downturn in business. To make these disagreements get resolved put a circuit breaker in place — a person with a casting and binding, vote and give him or her a title like CEO or Managing Partner.
After you’ve examined your practice on strategy and structure, by all means turn your attention to the usual suspects, like staff motivation, technology tools, and workflow processes. Do you praise and reward a job well done?Have you invested in appropriate software? Do you schedule working times for staff with no outside interruption, for example from phones or email? Do you balance workloads across all staff? Do you set realistic delivery schedules and work flows? Do your specialists waste time on clerical work?
But don’t begin with the usual suspects. If your organization is suffering from productivity issues, start by looking beyond the oh-so-standard time management course for staff. A bunch of PowerPoint slides over half a day will probably achieve very little. The cause may be more systemic. Dig deeper. You may be surprised.
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