Much has been said about the productivity of the UK economy in general and it being lower than many others in both Europe and the wider world.
The Chancellor has previously referred to the level of UK productivity. The problem that has been outlined is that if there is no improvement in the productivity of UK business, then profits will not improve so pay won’t improve and tax receipts won’t rise. This means government borrowing will stay high with continuing pressure on spending and our individual standards of living will, at best, show no improvement.
Productivity is, crudely, the amount produced per head. In the past, UK business was overmanned but this was addressed in the 1980s and, seeing the pressure many are now working under, reducing the workforce, is unlikely to be the answer now. The good news is that there has been an improvement in productivity and perhaps there is more to come.
Perhaps a bit of innovation might help. Innovation doesn’t have to be big technology projects — innovation can be small improvements to how things are done. This can be improvements to processes, improvements to a product and service or training, for example. A number of small improvements can add up to something significant. Such innovations may well entitle the business to R&D tax relief, which will provide a further cash flow benefit to invest in productivity.
Our challenge in business is to find those small improvements to keep productivity moving the right way, and then to find more improvements so that it becomes habit. Everyone in an organisation has a part to play and business leaders have a role to encourage ideas — if we all carry on doing what we do, in the same old way, the productivity problem will never be beaten.
Find out more about Tim Watkins
19 March 2018 General
Improving productivity with simple innovations
Much has been said about the productivity of the UK economy in general and it being lower than many others in both Europe and the wider world.
The Chancellor has previously referred to the level of UK productivity. The problem that has been outlined is that if there is no improvement in the productivity of UK business, then profits will not improve so pay won’t improve and tax receipts won’t rise. This means government borrowing will stay high with continuing pressure on spending and our individual standards of living will, at best, show no improvement.
Productivity is, crudely, the amount produced per head. In the past, UK business was overmanned but this was addressed in the 1980s and, seeing the pressure many are now working under, reducing the workforce, is unlikely to be the answer now. The good news is that there has been an improvement in productivity and perhaps there is more to come.
Perhaps a bit of innovation might help. Innovation doesn’t have to be big technology projects — innovation can be small improvements to how things are done. This can be improvements to processes, improvements to a product and service or training, for example. A number of small improvements can add up to something significant. Such innovations may well entitle the business to R&D tax relief, which will provide a further cash flow benefit to invest in productivity.
Our challenge in business is to find those small improvements to keep productivity moving the right way, and then to find more improvements so that it becomes habit. Everyone in an organisation has a part to play and business leaders have a role to encourage ideas — if we all carry on doing what we do, in the same old way, the productivity problem will never be beaten.
Find out more about Tim Watkins by clicking here.
Contact Tim to arrange a chat by sending an email to tim.watkins@randall-payne.co.uk or calling 01242 776000.
by clicking here.
Contact Tim to arrange a chat by sending an email to tim.watkins@randall-payne.co.uk or calling 01242 776000.
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