The UK has a well-documented productivity problem. Eurostat data shows that the productivity gap between the UK and Denmark, the EU country with the shortest working week, is now 23.5 per cent. Debate continues about the causes and possible solutions, as do discussions about excessive working hours, with employees of all demographics seeking a better work-life balance.
The zeitgeist right now is cutting down the working week to increase workplace satisfaction levels and therefore productivity – with some even suggesting more radical measures such as four-day working weeks. However, the well-established hedonic treadmill theory, backed by multiple academic studies, suggests that moves to downsize the working week may need to be reappraised. It says people return to a base level of happiness after positive (and negative) experiences; in other words, while there may be a potential spike in staff satisfaction and engagement after initiating a shorter week, in time levels are likely to revert to where they were before, threatening a company’s productivity rather than adding to it.
With a rigorous approach based on analysis and review, there is much that companies can do to increase, maintain and continue to improve employee happiness, engagement and productivity, and avoid the effects of the hedonic treadmill. There are five critical dimensions employers should think about:
A move to a shorter week should be done by gradually reducing working hours. An incremental approach should also apply to new ‘bank holidays’. Another option is to reduce the frequency and duration of meetings to increase efficiency.
Continuous improvements to working processes
One of the best ways to boost workforce engagement and productivity is to empower employees at all levels to come up with solutions themselves. This should be a continuous programme rather than a one-off initiative. Employers could also introduce lean ways of working, such as finalising projects in sprints and providing rewards for meeting goals.
The continuous change process needs to be communicated clearly and regularly to ensure awareness and appreciation of change. This should show both where the company has come from and where it is going, to demonstrate the path of improvement. Care is required to ensure this isn’t simply the re-announcement of existing initiatives.
Impact within and beyond the organisation
Employees have always been more engaged when they see the value of what they do beyond their pay cheque and job security. Helping to build the organisation and having a positive influence on the outside world are natural parts of people’s satisfaction with their lives. The millennial generation has brought a fresh sense of urgency about wanting work to have societal and environmental impact. This will require many organisations to rethink their missions and responsibilities, how they communicate their value to their workforces and each individual’s role in contributing to the greater good.
Creating an environment of good stress
Companies need to ensure they are geared for the right level of stress. Too much impairs performance, but too little has a negative impact on engagement. What organisations should be striving for is ‘eustress’ – a positive stress or ‘race ready’ excitement and energy that comes from motivating and inspiring situations like promotion, giving a presentation or pitching for business.
Introducing a ‘big bang’ hours-reduction initiative, unless it is augmented by structured, continuous effort to maintain momentum, may result in actual damage to company productivity, however well intended it is. But well thought-through and carefully implemented measures of this kind can have substantial benefits on recruitment, retention, welfare, productivity and therefore profit.
Andrew Allum and Peter Ward are partners at L.E.K. Consulting