Britain’s productivity continues to lag behind our European neighbours such as Italy, France and Germany. In a recent speech, Andy Haldane, Chief Economist and Executive Director of Monetary Analysis and Statistics at the Bank of England, said failings in management play a large part in the continuing ‘productivity puzzle’.
Haldane cited the work of two prominent economists as evidence:
“Nicholas Bloom and John Van Reenen have shown that weaknesses in management processes and practices go a long way towards explaining the long tail of low productivity manufacturing companies,” he said.
“Looked at quantitatively, there is a statistically significant link between the quality of firms’ management processes and practices and their productivity. And the effect is large. A one standard deviation improvement in the quality of management raises productivity by, on average, around 10%. This suggests potentially high returns to policies which improve the quality of management within companies.”
The Chartered Management Institute (CMI) agrees with Mr Haldane’s view, adding that “Poor management is costing the British economy billions, and is a weight around the neck of UK Plc, preventing it from being a ‘globally competitive economic power’.”
Research conducted by the CMI shows that 4 in 5 managers are ‘accidental managers’ who have never been trained before. That means almost 2.5 million managers are currently learning by trial and error owing to employers’ lack of investment in leadership development.
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To find out more about our leadership development programmes, please visit our leadership and development page - http://www.msbconsultancy.com/leadership-development.html