A group of business leaders have launched a new organisation in a push to improve the efficiency of small and medium-sized UK businesses and address the productivity gap between them and the country’s most successful companies.
Launched at a Bank of England “summit” earlier this month, Be the Business is chaired by the John Lewis Partnership’s Sir Charlie Mayfield, and includes a roster of business leaders from a variety of sectors including KPMG’s James Steward, EY’s Steve Varley, as well as representatives from Amazon, Accenture, BAE Systems, BT, Cisco, GSK, McKinsey & Co, Nestle, Rolls-Royce, and Siemens.
The group plans to boost Britain’s productivity and make the country more competitive as it prepares to leave the European Union, which Mayfield describes as “the biggest economic challenge we face as a country”. Fears about the impact of Brexit on the UK’s finances has pushed ministers to place boosting productivity at the centre of the government’s industrial strategy, and Be the Business’ digital advice platform and mentoring programme is designed to help in these efforts.
Speaking at the group’s launch event, Bank of England governor Mark Carney said: “Reviving productivity growth is critical for the UK’s long-term economic prosperity, and part of the answer lies in spreading best practice across a much wider range of firms. Be the Business are playing a key role in achieving that, helping businesses to identify and implement ways to improve their productivity.”
The UK’s productivity growth has been in the doldrums since the 2008 financial crisis, with the amount produced by UK workers on 0.4% more in June 2017 than it was nine years prior. The latest productivity figures from the Office of National Statistics (ONS) showed a 0.7% growth in output per hour in the fourth quarter of 2017, far above recent rates, but it remains unclear whether the unexpected improvement signals an end to the UK’s productivity woes, or a short-lived inconsistency.
A more productive workforce, where workers achieve more in less time, provides the basis for economic growth, prosperity, and increased tax receipts for the government. Improvements are generally achieved through investment in new technologies, infrastructure, worker skills training, and more efficient logistical processes, which TNT says can boost planning productivity by 3-6%.
British workers are currently the fifth least productive in the G7, and the resultant weak economic growth has negatively impacted the country’s public finances and depressed living standards. Germany is the most productive nation per hour, while the US beats the competition in output per worker due to the longer hours each person works.