1 WHO HO I IS PR S PRODUC UCTIVI VITY PRESENTATION TO TIPED / - - PowerPoint PPT Presentation

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PRESENTATION TO TIPED / GGDA Productivity SA on Performance Management

Presented by: Mothunye Mothiba Chief Executive Officer

WHO HO I IS PR S PRODUC UCTIVI VITY

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• The Mandate of Productivity SA
• Alignment to Government Policies and

Programmes

• Productivity SA Service Offering and

Core Functions

• Productivity Defined
• Value Defined
• Performance Management
• What next

PRESENTATION OUTLINE

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Productivity SA is established in terms of section 31 of the Employment Services Act,

• No. 4 of 2014 as a juristic person and an Entity of the Department of Labour.
• MANDATE. To promote employment growth and productivity thereby contributing to

South Africa’s socio-economic development and competitiveness.

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THE MANDATE OF PRODUCTIVITY SA

Vision

To lead and inspire a productive and competitive South Africa.

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“To improve productivity by diagnosing, advising, implementing, monitoring and evaluating solutions aimed at improving South Africa’s sustainable growth, development and employment through increased competitiveness”

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MISSION

VALUES

Service excellence through implementation

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relevant, productivity-enhancing solutions Market leadership through creative and innovative solutions Synergy with all partners to achieve common goals Collaboration with stakeholders in pursuing solutions to South Africa’s productivity challenges Honesty, integrity and professionalism

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ALIGNMENT TO THE NDP AND THE MTSF 2014/15 – 2019/20

Ser ervic ice Deliv eliver ery O Outco tcome Lin ink to to th the e ND NDP

Outcome 4: Decent employment through inclusive economic growth.

• Improve performance of the core productive

sectors including manufacturing, agriculture and mining, local procurement and other programmes.

• Increase growth of the small business sector

Chapter 3 of the NDP: Target programmes that contribute to sustainable and inclusive growth and development.

• Growth with rising employment creation and income growth

 Jobs to increase from 13m to over 24m  Unemployment to be reduced from 25% to 6%  GDP Growth at 5.4% (best case scenario) or 3.3% (worst case scenario) Outcome 5: A skilled and capable workforce to support an inclusive growth path.

• Improve the linkage between FET institutions,

SETAs and employers as the basis for improving responsiveness and quality in training

• Research, Development, and Innovation

partnerships between government and the private sector strengthened Chapter 9 of the NDP

• Improving education, training and innovation
• Develop world-class centres and programmes in the national

system of innovation, training and development Outcome 12: An efficient and development oriented public service Chapter 13 of the NDP.

• Implement programmes that improves efficiency and

effectiveness of government

• Stronger performance management and accountability

THE SERVICES AND CORE BUSINESS OF PRODUCTIVITY SA

Section 32 of the Act enjoins Productivity SA to develop and enhance relevant productivity competencies and business efficiency in the workplace, with a focus the following Key Functions (Core Business):  To promote employment, income and wealth growth, and increase workplace productivity.

– Business Transformation and Competitiveness Improvement Programmes to enhance productivity and competitiveness of enterprises (emerging and existing) of all sizes within the IPAP Priority Sectors; and – Enterprise development and productivity training programmes to enhance the appropriate capacities of Small and Medium Enterprises and co-operatives to adopt world-class productivity enhancement best practices, with a focus on products, processes and people; and

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THE SERVICES AND CORE BUSINESS OF PRODUCTIVITY SA

Section 32 of the Act enjoins Productivity SA to develop and enhance relevant productivity competencies and business efficiency in the workplace, with a focus the following Key Functions (Core Business):  To provide support to enterprises facing economic distress and initiatives or schemes aimed at preventing job losses or minimising the retrenchment of employees.

– Implementing Business Turnaround and Recovery plans and programmes to restructure and improve the productivity operational efficiency of the organisation. – Facilitating the establishment of Enterprise-Based Productivity Forums to promote dialogue

• n Productivity Improvement Strategies as well as training of members thereof.

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THE SERVICES AND CORE BUSINESS OF PRODUCTIVITY SA

Our Value Proposition: We offer Productivity and Competitiveness Improvement Solutions

to accelerate wealth and decent employment creation, by enhancing the productive capacity and operational efficiency of enterprises throughout the business lifecycle.

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Break even Point (BEP) Stable companies “ICU” Workplace Challenge Decline Turnaround Solutions Emerging companies Productivity Organisational Solutions

Performance Management (The African Poem)

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Every morning in Africa a Gazelle wakes up It knows it must outrun the fastest lion or it will be killed Every morning in Africa a lion wakes up It knows it must outrun the slowest gazelle or it will starve It doesn’t matter whether you are a lion or a gazelle

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Productivity VS Performance Management

• According to Bernolak (1997) productivity means “how much and how good we

produce from the resources used,” whereas The European Association of National Productivity Centres (EANPC, 2005) defines productivity as “how efficiently and effectively products and services are being produced.”

• Efficiency in this context can be seen as “doing things right” or utilizing resources to

accomplish desired results (Grünberg, 2004); whereas

• Effectiveness, on the other hand, is often described as “doing the right things”; it

refers to the extent to which customer requirements are met (Neely et al., 1995).

• Thus, effectiveness highlights the importance of reaching a desired objective,

whereas efficiency focuses on the process or means involved.

• While high productivity can be a significant source of competitive advantage for

companies (Grossman, 1993), it also contributes to the general well-being of a society.

• In general, productivity is often defined as a relationship between output produced by

a system and quantities of input factors utilized by the system to produce that output.

COLLABORATION

PRODUCTIVITY RATIO

THE PRODUCTIVITY DEFINED

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In general, productivity is often defined as a relationship between output produced by a system and quantities of input factors utilized by the system to produce that output.

Here, the output can be any outcome of the process, whether a product or service, while input factors consist of any human and physical resources used in a process. It follows that, in order to increase productivity, the system must either produce more or better goods from the same resources, or the same goods from fewer resources. S tated differently, productivity improvement refers to an increase in the ratio of produced goods or services in relation to resources used.

• Doing the right things (effectiveness)
• Doing things right (efficiency)

COLLABORATION

PRODUCTIVITY OR NOT ??

THE “WHAT” T” O OF PRODUCTIV TIVITY ITY

Peter Drucker’s well-known comment sets a deceptively simple expectation for us – namely that

• nce you have captured the numbers, you’ll be fully

armed to somehow “make it better.” While labor measurement is not easy, it is the easier part of “Creating and Measuring …” The secret of productivity improvement lies in what you do, after you figure out how to measure it.

THE PRODUCTIVITY PROCESS

INPUTS OUTPUTS Process Conversion

Between Inputs (Human, Information, Raw Materials, Knowledge, Technology) and Outputs (information, Goods, Services) there is a blood sweat and tears process called “Conversion”/ Activities and Capability (A task that a particular Operations Management System can perform effectively) During “Conversion” ALL input factors are put together Labour is only one of the factors

Productivity as Value Driver

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POLICIES (FISCAL,MONETARY & WAGE POLICIES) POLICIES OF OTHER COUNTRIES Natural Phenomenon QUALITY WORK QUALITY LIFE

LABOUR

• Positive work attitudes
• Skills upgrading
• Teamwork
• Harmonious Labour-

relations

• Healthy workforce
• Participation in

Productivity programmes

CAPITAL & SYSTEMS

• Innovation
• Technology

QUALITY PRODUCTS/ SERVICES

HIGHER PRODUCTIVITY HIGHER GDP GROWTH

LABOUR

• Incentives

BUSINESS

• Greater

Competitiveness

• Higher

Profitability

GOVERNMENT

• Higher/capita

GDP

• More Savings

HIGHER STANDARD OF LIVING

Value Defined

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A customer’s or citizen’s subj ective evaluation, adj usted for cost, of how well a good or service meets or exceeds expectations. Customers do not care about the firm’s maximizing is cost effectiveness or profit; rather they want to maximize value Therefore, Value is defined by the customer / citizen VALUE = PERFORMANCE / COST The Value Equation expresses value as a comparison of what a product or service can do against what it costs Performance describes what a good or service does for the customer or

• citizen. Typically performance is described in terms of three traits: Quality,

S peed and Flexibility Cost represents all costs (obj ective and subj ective) that the customer incurs to acquire, use and dispose of the good or service.

Productivity & Growth

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‘ Growth that adds volume without improving productivity is fat. Growth that diminishes productivity is cancer’ —Peter Drucker

Performance Management (IMD Perspective)

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Key Strategies for High Preforming Organisations

• Leadership practices that promote teamwork, employee participation,

continuous learning and flexibility;

• Simultaneous improvement of quality, speed/delivery; cost and morale

aligned to overall business strategic intent;

• Establishing close links with customers and suppliers;
• Linear and non-linear improvement initiatives;
• Eliminating all forms of waste and making value flow;

PERF PERFORM RMANCE M MAN ANAGEMENT L LEV EVELS

Organisational:

• Increased operational efficiency and effectiveness

creating sustainable performance improvement

• Increased buy-in across the organisation through jointly

agreed goals and measures

• Enhanced performance driven climate

Individual:

• Empowerment of individual toward fulfilling their
• ptimum potential
• Proactive management of individual performance
• Identification of potential high flyers.

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What can be done now? (Goal Alignment)

Vision Strategy Tactic Task Action

Break Down

Planning

Accumulate

Results

Strategic Ground Design Outcome based Programme Feasible Work Plan Performance Plan

Planning Phase

Leadership role in Performance Management

Vision Capability Credibility

Courage

People feel significant & energised People trust, feel dignified & part of a team Work is exciting Competency & learning matters

Leadership Qualities Creating the Environment for People to Perform

Source: This model is the result of the combination of the work of many Authors and practitioners, notably: Wickens, Koestenbaum, Augustine, Bennis et al

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Performance Management (Goal Alignment)

STRATEGY CULTURE INNOVATION

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Way Forward

Reward Productive Business Promote and Reward Excellent Performance Understand your impact and be efficient

Goal Aligned Systems Approach

THE S SOLUTIO TION

INCREASE THE NUMERATOR (OUTPUT) OR DECREASE DENOMINATOR (INPUT) OR INCREASE OUTPUT FASTER THAN INPUT OR DECREASE INPUT WITHOUT DECREASING OUTPUT

THANK YOU

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