lln, skills & productivity: making the leap

John BensemanCritical Insight

LLN, skills & productivity:making the leap

Productivity

Workplace productivity refers to how efficiently and effectively a workplace can turn its inputs, such as labour and capital, into outputs, such as products and services

An on-going concern for most Western governments over past decade - closely linked to international competitiveness

New Zealand Cabinet adopted the Workplace Productivity Agenda (WPA) to foster productivity development at the workplace

LLN has ridden on the back of productivity?

New Zealand has slipped to 20th among 58 economies measured on the world competitiveness scoreboard, the just-released IMD World Competitiveness Yearbook says. The drop of five places significantly worsened the trans-Tasman gap, with Australia improving two places to rank fifth in the world (NZH21/5/10).

What drives productivity?

UK: New Zealand Treasury:

1. Investment2. Innovation3. Skills4. Enterprise5. Competition

+ 16 more specific levers

1. Innovation

2. Skills

3. Investment

4. Access to natural resources

New Zealand Institute5. Entrepreneurship

6. Skills & talent

7. Innovation

8. Investment

9. Natural resources

Factors driving productivity (DoL,NZ)

1. Building leadership and management capability

2. Creating productive workplace cultures 3. Encouraging innovation and the use of technol

ogy4. Investing in people and skills

Enables innovation more capable with new technology Work more quickly with fewer mistakes require less supervision accept more responsibility better communicators Training leads to higher skills and wages and lower

staff turnover.

5. Organising work6. Networking and collaboration7. Measuring what matters

From the literature(Mayhew & Neely, 2006, Keep et al, 2006)

Most research at the macro level Investment is the key No one factor is sufficient – ie skills are a

necessary, but not sufficient condition Wide range of strategies, also diverse

outcomes Productivity: increasing efficiency or

increasing quality Need for micro studies at company level –

what happens inside the black box?

Skills and productivity

Empirical evidence overwhelmingly demonstrates link between skills & labour productivity

But, variations from company to company & at different stages of development

‘Need for the right type of skills, at the right level & for the right groups of workers. Blanket approaches may waste a lot of money & produce minimal results’ (Keep et al, 2006)

Skills…

‘Skills are the simplest, best, most direct way to boost productivity. Skills investment is the only way to maintain productivity’ (UK

Sector Skills Development Agency, 2006)

Seen as a scapegoat? (Keep et al, 2006)

1/5 – 1/8 of UK’s gap with Germany & France

Seen as ‘easy lever’ for policy?

LLN not specifically mentioned

Skills, but what skills?

Qualifications (generic vs. specific) – poor proxy for skills?

Specific, technical skills (e.g. machinery) IT skills Soft skills LLN skills

Generic Contextualised

‘More skills (= quals) are needed’ mantra

LLN & productivity

Primarily about changes in workplace practices

Working smarter, not necessarily harder

How to demonstrate LLN’s uniqueness vs. rock climbing or other workplace skills?

Changes in ESs

Improved Productivit

y

The ‘Black Box’

Workplace Productivity Projects evaluated by DoL (2009)

Partnership approach – firms, govt. depts., industry bodies, unions & business consultants

28 workplaces

Direct tailored assistance: needs analyses by business consultants

Implementation (or not) by company Range of interventions

WPP identified needs

strategic and operational planning

management capability and leadership skills

organising and understanding workflow

workplace culture and communication

WPP outcomes

‘Some’ improvement across all 28 sites

‘Moderate’ to ‘considerable’ improvement at 20 sites

Improvements: increased worker participation increased knowledge and skills improved business planning improved work processes

Claimed impacts of LLN programmes

Better quality work Fewer rejects/re-works Greater efficiency

Better use of technology, incl. computers

Improved health and safety Increased self-confidence Better communications

King Salmon

ES to Productivity: the ideal

SHINPOH 1ST GRADE

Slice Height: minimum 30mm Slice Length; 120-175mm Bloodspot: 1-3mm up to 10 spots in a Pack Freckles: less than 1/3 of Pack V. Gapes: < 5mm over 1/3 of Pack Tears: No Tear > 10mm in length

Outcome: 40% increase in top grade products

‘Proving’ the link between learning & application

The ‘black box’ of learning transfer

8 case studies at Fletcher Aluminium

Transfer varies according to: Relevance of teaching content Generic skills vs. specific skills for transfer Nature of LLN skill Degree of LLN need Time Management factors

LLN & productivity – what do we know?

Not a simple input/output/outcome chain Variations across workers & contexts LLN does have an impact on workplace

practices, but not necessarily productivity

LLN skills are a ‘logical’ form of workplace skills

We need to be selective about LLN Who participates What is taught

LLN changing workplace practices – what don’t we know? What can realistically be changed –

micro level, nationally?

How do changes in workplace practices contribute to productivity?

What does LLN need to be ‘bundled’ with?

References

Mayhew, K. and A. Neely (2006). "Improving productivity – opening the black box." Oxford Review of Economic Policy 22(4): 445-456

Keep, E., K. Mayhew, et al. (2006). "From skills revolution to productivity miracle - not as easy as it sounds?" Oxford Review of Economic Policy 22(4): 539-559

Questions and/or comments?

Contact: john.benseman@criticalinsight.co.nz