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7 steps to unlocking productivity with ‘people power’

New research from CBI shows that UK business could add £110 billion to the economy by improving people management practices, such as setting targets and improving accountability.

Great Job: Solving the productivity puzzle through the power of people, produced by CBI and supported by McKinsey & Company, argues that UK business has not kept pace with international peers on people management. 

This failure could be one of the more undervalued reasons why UK productivity growth is now lower than at any time in the 20th century - and lagging significantly behind the G7.  

Matthew Fell, CBI Chief UK Policy Director, said: 

When firms cast around for ways to improve their productivity performance, much of their time, money and effort are invested into new (and existing) technologies to get more out of their business. And rightly so, as rapid tech and digital advances are creating new and better ways of working. 

But[our research]suggests that too many businesses are missing a trick by not investing more into how they engage with workers. 

Its not about people working harder and longer. Its about getting the right kind of habits and behaviour into the DNA of a business and how it leads, develops and engages its staff to lift performance. 


The research shows that making even small improvements could yield sizeable productivity gains, and identifies seven key habits: 

  • Make good people practice a shared business priority: Organisational changes are four times more likely to succeed when those at the top role-model the behaviours they want others to follow 
  • Put people management on a par with commercial targets: Line managers should have people management objectives with key performance indicators (KPI) alongside commercial objectives 
  • Establish a shared purpose for the business and recognise peoples contributions: Firms which have the highest employee engagement tend to see significantly lower absenteeism and higher profits 
  • Put peoples skills and competencies at the heart of recruitment: Recruiting high performers into management roles has been found to generate nearly 50 per cent higher profits for businesses 
  • Provide high-quality on-the-job development and support: Businesses that develop their staffs strengths have been found to reduce employee turnover by up to 72 per cent 
  • Assess performance on people practices: A quarter of managers say benchmarking their people management performance against competitors has improved their business 
  • Be open about performance: Talking publicly about performance has significant reputational benefits, with 69 per cent of the public believing that treating staff well is the number one way to improve reputation. 


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